Employees; verification of status required, when; research tax credit; calculation

(1) This subsection shall apply for tax years beginning or deemed to begin on or after January 1, 2009, and before January 1, 2023. The Tax Commissioner shall not approve or grant to any person any tax incentive under the Nebraska Advantage Research and Development Act unless the taxpayer provides evidence satisfactory to the Tax Commissioner that the taxpayer electronically verified the work eligibility status of newly hired employees employed in Nebraska.

(2) This subsection shall apply for tax years beginning or deemed to begin on or after January 1, 2023. When calculating the research tax credit as provided in the Nebraska Advantage Research and Development Act, the qualified research expenses claimed in computing the federal credit allowed under section 41 of the Internal Revenue Code of 1986, as amended, shall be adjusted to the extent the taxpayer includes, in such qualified research expenses, compensation paid to an employee of such taxpayer hired during or after the first tax year for which the Nebraska Advantage Research and Development Act credit is claimed by such firm and to the extent such compensation is subject to Nebraska income tax. Such compensation, for the tax year in which the credit is being claimed, shall be deducted from the taxpayer's qualified research expenses unless such employee was verified as eligible to work in the United States using the federal E-Verify system within ninety days after the date of hire of such employee or such longer period as may be permitted under the rules of the federal E-Verify system. Such verification may be performed by the taxpayer or by someone on the taxpayer's behalf.