Wage benefit credit; calculation; excess withholding; refund

(1) If a company has entered into an agreement with the state pursuant to section 77-4928 , employees who are employed at the project covered by the agreement, other than base-year employees, shall during each project year receive the wage benefit credit in the manner provided in the Quality Jobs Act.

(2) The wage benefit credit shall be paid or applied by the employee for company training programs, employee benefit programs, educational institution training programs, or company workplace safety programs, or any combination thereof, as designated by the employee or as agreed to by the company and employee.

(3) Except as provided in subsection (4) of this section, the wage benefit credit per employee shall be an amount equal to the Nebraska income tax withholding attributable to the employee's compensation for services rendered in connection with the project for the project year without regard to the credit calculation under subsection (6) of this section.

(4) The wage benefit credit total for the project per year shall not exceed five percent of the total compensation paid by the company in the year to all employees, other than base-year employees, for services rendered in connection with the project. If the total of the wage benefit credit exceeds five percent of the total compensation paid to all employees, other than base-year employees, the withholding in excess of five percent of each employee's compensation shall be returned to the Department of Revenue in the manner provided in section 77-2756 .

(5) The wage benefit credit shall be allowed for each project year.

(6) The wage benefit credit shall be withheld by the company from the employee's compensation in the normal manner provided by section 77-2753 , except that the amount shall not be required to be paid over to the state under section 77-2756 and shall not constitute part of the trust fund or be owned by the state as provided in section 77-2757 , but instead shall, to the extent of attributable tax liability, represent a credit in the calculation of each such employee's tax liability and shall be paid or applied for the programs in the manner that the company and employee have determined as allowed by the act. For purposes of the withholding reporting provisions of sections 77-2754 and 77-2756 , the company shall report the wage benefit credit separately to the state and to the employee as a wage benefit credit. Each employee shall be allowed on his or her Nebraska income tax return a nonrefundable credit against the tax imposed by sections 77-2714 to 77-27,123 equal to the wage benefit credit not to exceed (a) his or her income tax liability minus (b) the amount that Nebraska income tax liability would be if the total compensation paid by the company in the taxable year were excluded from the employee's adjusted gross income. The calculation of this nonrefundable credit shall be included with the employee's tax return and reported as determined by the Department of Revenue. If any amount allowable as a wage benefit credit has been through error or otherwise improperly paid to the state, it shall be refunded to the person who paid it upon application for refund filed within three years after payment. If the wage benefit credit withheld by the company exceeds the nonrefundable credit allowed the employee as calculated in this subsection, the company shall refund the difference to the employee. The company may request verification or substantiation of the amount claimed. Such verification or substantiation shall be confidential and used only for the determination of the claim filed by the employee. A company shall notify employees individually in writing at the time the company reports the wage benefit credit to the employee of the right to claim a refund under this subsection by April 1 of each year. The claim for the refund from the company shall be made by September 1 of the year when the employee files his or her tax return or fifteen days after the employee files such tax return, whichever is later. The company shall pay the refund to an employee within thirty days after the date a claim is filed.