Application; form; qualified project; allocation of credit; transfer, sale, or assignment; use of credit

(1) An owner of an affordable housing project seeking a Nebraska affordable housing tax credit shall file an application with the authority on a form prescribed by the authority. An owner shall be allowed a nonrefundable tax credit if the authority determines that (a) the project for which tax credits are sought is a qualified project and (b) tax credits are available.

(2) If the requirements of subsection (1) of this section are met, the authority shall issue an eligibility statement to the owner of such qualified project stating the amount of Nebraska affordable housing tax credits allocated to the qualified project. The amount of such tax credits shall be the amount of federal low-income housing tax credits available to such project, except as otherwise provided in subsection (4) of this section. Tax credits for each building in a qualified project shall be issued for the first six years of the credit period as defined in 26 U.S.C. 42(f)(1), except that any reduction in the credit allowable in the first year of the credit period due to the calculation in 26 U.S.C. 42(f)(2) shall be allowable in the seventh year of the credit period. The authority shall only allocate tax credits to qualified projects that are placed in service after January 1, 2018.

(3) If the owner of the qualified project is a pass-through entity, the Nebraska affordable housing tax credit shall be allocated among some or all of the partners, members, or shareholders of the owner of the qualified project. Any pass-through entity that receives an allocation of the Nebraska affordable housing tax credit, either from the owner of the qualified project or from another pass-through entity, may (a) further allocate the tax credit among some or all of the partners, members, or shareholders, or (b) transfer, sell, or assign all or a portion of the tax credit to a taxpayer. A pass-through entity may allocate the tax credit in any manner agreed to by its partners, members, or shareholders. A partner, member, or shareholder allocated a tax credit must have been admitted as a partner or member, or have acquired his or her shares, on or prior to February 15 of the year in which the tax return, or amended return, claiming the tax credit is filed. A partner, member, or shareholder of a pass-through entity may transfer, sell, or assign all or part of his or her ownership interest, including his or her interest in the tax credits authorized in this section. A taxpayer may transfer, sell, or assign all or a portion of the tax credit to another taxpayer. A taxpayer must have received a transfer or assignment of a tax credit prior to the date a tax return, or amended return, claiming the tax credit is filed. For any tax year in which a credit is allocated, transferred, sold, or assigned pursuant to this subsection, the pass-through entity allocating the tax credit, or taxpayer transferring, selling, or assigning the tax credit, as applicable, shall notify the Department of Revenue of the allocation, transfer, sale, or assignment and provide the tax identification number of the allocatee or transferee at least thirty days prior to the taxpayer claiming the tax credit. The notification shall be in the manner prescribed by the department.

(4) The maximum amount of Nebraska affordable housing tax credits awarded to all qualified projects in any given allocation year shall be no more than one hundred percent of the total amount of federal low-income housing tax credits awarded by the authority in the same allocation year. Notwithstanding any other provision of the Affordable Housing Tax Credit Act, the authority is prohibited from awarding to a qualified project any combined amount of federal low-income housing tax credits and Nebraska affordable housing tax credits that is more than necessary to make the qualified project financially feasible.

(5) Any Nebraska affordable housing tax credits granted under this section may be used to offset any income taxes due under section 77-2715 or 77-2734.02 , any premium and related retaliatory taxes due under section 44-150 , 77-908 , or 81-523 , or any franchise taxes due under sections 77-3801 to 77-3807 .

(6) The tax credit shall not be used to reduce the tax liability of the taxpayer to less than zero. Any tax credit claimed but not used in a taxable year may be carried forward.