Nebraska Administrative Code › Topic - REVENUE, DEPARTMENT OF › Title 350 - Nebraska Department of Revenue, Property Assessment Division › Chapter 40 - Property Tax Exemption Regulations › Section 350-40-012 - BEGINNING FARMER PERSONAL PROPERTY EXEMPTION

Current through June 17, 2024
012.01
Definitions
012.01A Agricultural assets means
				agricultural land, livestock, farming or livestock production facilities, or
				buildings and machinery and equipment used for farming or livestock
				production.
012.01B Board means the
				Beginning Farmer Board comprised of the Director of Agriculture (or his or her
				designee), the Tax Commissioner (or his or her designee), one individual
				representing lenders of agricultural credit, one individual of the academic
				community involved in agricultural economics, and one individual from each of
				the three congressional districts that are involved in farming and livestock
				production.
012.01C Depreciable
				tangible personal property is subject to personal property taxation.
				Depreciable tangible personal property means tangible personal property which
				is used in a trade or business or used for the production of income, and which
				has a determinable life of longer than one year.
012.01C(1) Depreciable tangible personal
				property also includes tangible personal property which is eligible for
				depreciation for purposes of federal income tax, but which the owner chooses
				not to depreciate.
012.01C(2)
				Depreciable tangible personal property also includes all other tangible
				personal property for which a taxpayer is claiming depreciation, amortization,
				or Internal Revenue Code (IRC) § 179 deductions for purposes of federal
				income tax.
012.01C(3) Depreciable
				tangible personal property also includes capital expenses incurred because of
				major repairs, parts, labor, and installation costs that prolong the useful
				life, increase the value of an asset, or adapt the asset for a different
				use.
012.01C(4) The taxable value
				of depreciable tangible personal property is the net book value of the
				property.
012.01D
				Nebraska adjusted basis means the adjusted basis of tangible personal property
				as determined under the IRC as it exists on the assessment date, increased by
				the total amount allowed under the IRC for depreciation or amortization, or
				pursuant to an election to expense depreciable property under IRC § 179,
				as amended. Generally, this is the original cost of the item and includes any
				costs incurred in purchasing and placing the item in service such as sales or
				excise taxes, freight charges, installation, and testing charges.
012.01E The Nebraska depreciation factor is
				the percentage of the Nebraska adjusted basis that is taxable. The following
				table provides the depreciation factors, based on year acquired and recovery
				period:
Year
Recovery Period (in
						  years)
3
5
7
10
15
20
1
75.00 %
85.00 %
89.29
						  %
92.50 %
95.00 %
96.25 %
2
37.50 %
59.50 %
70.16
						  %
78.62 %
85.50 %
89.03 %
3
12.50 %
41.65 %
55.13
						  %
66.83 %
76.95 %
82.35 %
4
0.00 %
24.99 %
42.88
						  %
56.81 %
69.25 %
76.18 %
5
8.33 %
30.63 %
48.07
						  %
62.32 %
70.46 %
6
0.00 %
18.38 %
39.33
						  %
56.09 %
65.18 %
7
6.13 %
30.59
						  %
50.19 %
60.29 %
8
0.00 %
21.85
						  %
44.29 %
55.77 %
9
13.11
						  %
38.38 %
51.31 %
10
4.37
						  %
32.48 %
46.85 %
11
0.00
						  %
26.57 %
42.38 %
12
20.67
						  %
37.92 %
13
14.76
						  %
33.46 %
14
8.86
						  %
29.00 %
15
2.95
						  %
24.54 %
16
0.00
						  %
20.08 %
17
15.62
						  %
18
11.15
						  %
19
6.69
						  %
20
2.23
						  %
21
0.00
						  %
012.01E(1) In
				the table, the factor shown for year one is the percentage used January 1 of
				the year following the year of acquisition of the property. The factor shown
				for year two is the percentage used January 1 of the second year following the
				year of acquisition of the property, etc. When property becomes depreciable in
				a year other than the year it is acquired, it is subject to taxation on the
				first assessment date following the date it became depreciable. The net book
				depreciation factor for the property is based on the year it is acquired.
012.01F Net book value
				is the Nebraska adjusted basis of depreciable tangible personal property
				multiplied by the appropriate Nebraska depreciation factor.
012.01G Personal property includes all
				property other than real property or franchises.
012.01G(1) Tangible personal property
				includes all personal property possessing a physical existence, but excluding
				money.
012.01G(2) Intangible
				personal property includes property that has no intrinsic value by itself, but
				is representative or evidence of value, such as stocks, bonds, promissory
				notes, contract rights, bank accounts, money, and other such property.
012.01H Qualified
				beginning farmer or livestock producer means an individual who is a resident of
				this state, who intends to enter farming or livestock production, and who meets
				the eligibility guidelines in Neb. Rev. Stat. §
										77-5209
				and other qualifications as determined by the Beginning Farmer Board.