Nebraska Schedules I, Ii, And Iii Instructions (Page 4 of 5) in pdf

Nebraska Schedule III – Computation of Nebraska Tax

LINE 64. Include the adjustments reported on lines 16 through

Taxpayers ﬁling a nonresident or partial-year resident return

must complete Nebraska Schedule III to determine the tax

19 of Federal Form 1040A, or lines 23 through 35 of Federal

on their income derived from or connected with Nebraska

Form 1040, that apply to income from Nebraska sources. Jury

sources.

duty pay, domestic production activity and penalty on early

savings withdrawal are deductible only if directly related to

LINE 63. Enter the income derived from Nebraska sources, or

Nebraska income reported on line 63. Payments to an IRA,

attach a schedule with the sources and amounts of income and

a self-employed health insurance plan, or a SIMPLE or SEP

deductions, characterized as they were on the federal return.

plan attributed to Nebraska income included on line 63 are

Nebraska income for a partial-year resident includes all items

deductible only to the extent of the ratio of the payments

of Nebraska income for a nonresident plus all of the income

based on the Nebraska wages or self-employment income to

earned while a Nebraska resident that is not taxed by another

the total wages or income for which the payments were made.

state. This includes dividends, interest, pension income, the sale

Identify the adjustment(s). A Roth IRA is not deductible on

of intangibles, and wages earned outside Nebraska.

line 64. Alimony or a student loan interest deduction may

Wages, salaries, tips, and commissions are the same

be deducted based on the ratio of line 63 income reported to

amounts included in your federal income tax return derived

total income of the taxpayer. Moving expenses as reported

from or connected with Nebraska sources. If the books and

on Federal Form 3903 may only be deducted by partial-year

records do not clearly reﬂect speciﬁc identiﬁcation of each

residents who moved into Nebraska.

income item, apportion the income to Nebraska based on

If you claimed a bonus depreciation subtraction on line 53,

either the days worked in Nebraska to the total days worked, or

or an enhanced Section 179 subtraction on line 54, include

the volume of business transacted. Attach an explanation.

these amounts on line 64.

Dividends, interest, and other passive income, such as

LINE 66. Calculate the factor to at least ﬁve decimal places

gains or losses from the sale of stock or securities, are usually

and then round to four decimals. For example, if the line 66

not considered income from Nebraska for a nonresident unless

result is .12346, round to .1235 (12.35%) before computing

earned in a business carried on in Nebraska. Do not include

line 71. Even if lines 5 and 63 are negative numbers, the ratio

income from U.S. obligations listed on line 49.

computed in line 66 cannot exceed 100 percent.

LINE 68. Enter, from the Nebraska Tax Table, the Nebraska

Business income is the amount of net income or loss

tax on line 67 income. Also enter any tax from the Additional

from a business, trade, or profession in Nebraska. Activity

Tax Rate Schedule if your federal adjusted gross income is

both within and without Nebraska, where the income is

more than $150,500 ($75,250 if married ﬁling separately)

taxable in another state, must be apportioned in the same

—see instructions.

manner as a corporation. Business income is multiplied by

an apportionment factor to determine the amount taxable by

Partial-year residents enter any Nebraska credit for the

Nebraska.

elderly or disabled, credit for child/dependent care expenses,

Nebraska Charitable Endowment Tax credit, or credit for prior

Farming income is the amount of net income or loss from

year minimum tax. See lines 16, 21, 25, 26, and 32 instructions

farming operations carried on within Nebraska.

in this booklet. Partial-year residents with Federal AGI of

Partnership, S corporation, limited liability company,

$29,000 or less do not claim their child care credit here.

estate or trust income is the individual’s share of the entity’s

Instead, complete the line 32 worksheet on page 9 to ﬁgure

income and deductions derived from Nebraska.

your refundable credit for these expenses. Enter this result

on line 32. Calculate any Nebraska earned income credit on

Gain or loss is the net amount of all capital gains and losses

lines 73 and 74.

derived in Nebraska from the sale, exchange, or involuntary

conversion of real or personal tangible or intangible

Nonresidents are not allowed a Nebraska earned income

property.

credit, credit for the elderly or disabled, or a credit for child/

dependent care expenses. Nonresidents enter credit for prior

Rent and royalty income is the net amount of rent and

year minimum tax. See line 16 instructions on pages 7 and 8

royalty income derived from or connected with Nebraska

of this booklet. Do not enter credits on lines 16, 21, 25, 26,

sources.

32, or 34. Line 68 cannot be less than zero.

Lottery prizes are derived from Nebraska sources when

LINE 69. Enter your credit for personal exemption(s). Do

awarded in a lottery game conducted pursuant to the Nebraska

not enter on line 19.

Lottery Act.

LINES 73 AND 74. Complete the number of qualifying

A net operating loss carryforward may be deducted only

children and the federal credit information. Calculate any

if it resulted from Nebraska sources. (Attach Form NOL)

Nebraska earned income credit. Enter result on line 34.

Nebraska Schedules I, Ii, And Iii Instructions Page 4

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