A program incentivizing microentrepreneurship by encouraging business investment is seeing renewed interest after updates made last year.
Established in 2005, the Nebraska Advantage Microenterprise Tax Credit experienced strong usage from 2008 to 2014 but saw a decline to only 75 applicants in 2019 and 81 in 2020. These dwindling participation rates encouraged a small group of senators to propose canceling the program.
Understanding its value to rural communities, the Center for Rural Affairs teamed with Sen. Tom Briese to protect the program and initiate a series of improvements. Legislative Bill 366 retained a 20% refundable tax credit to qualified business investments, but increased the maximum lifetime credit from $10,000 to $20,000. The bill also removed outdated eligibility requirements and established a requirement for the Nebraska Department of Economic Development to report on program usage, which will allow the Legislature to better understand its impact.
The positive response was immediate. In 2021 the program had 188 approved applications, a 132% increase from 2020. The total projected business investment from these applicants is $16,785,770, which will help create jobs and increase activity on Main Street. These are investments that likely would not have occurred without the Microenterprise Tax Credit in place.
An applicant must make an investment that is proven to grow their business to qualify. Because more than 80% of Nebraska businesses are considered microenterprises, there is a good chance you or someone you know is eligible.
The application deadline for 2022 is Nov. 1. For more information on the program, click here.