In 2016, the Nebraska Legislature passed LB 889 which created two new tax credits. One credit is for Nebraska’s early childhood professional workforce, and the second tax credit is for the quality early childhood programs that participate in Nebraska’s Step Up to Quality Program. These tax credits were enacted with the intent to support investment in quality early child care and education and increase access to quality early child care and education across the state of Nebraska. More information regarding the program tax credit can be found on the Nebraska Department of Revenue website after July 1, 2017.
The early childhood workforce tax credit is available for the 2017-2022 tax years to early childhood professionals who have attained the minimum qualification of a Child Development Credential (CDA) and who are employed in an early childhood program participating in Step Up to Quality. Additional early childhood professional development is required to be eligible for the tax credit. It is encouraged that early childhood professionals improve their knowledge and continue to seek professional development with the goal of enhancing and improving environments for children enrolled in quality programs.
The amounts of the refundable credit are based on the eligible staff member’s classification level as recommended by the Nebraska Department of Education. There are four classification levels (see chart below). The recommended classification is based on information self-reported and entered into Nebraska’s Early Childhood Professional Records System.
A tax credit attestation application must be completed in the Nebraska Early Childhood Professional Record System. The deadline for applying for the attestation of classification level is January 15, 2018. Once received, the eligible staff member can submit their claim to the Department of Revenue when filing their income tax return.
|Level 1||All Base Requirements||$500|
|Level 2||7 – 9 Points||$750|
|Level 3||10 – 12 Points||$1,250|
|Level 4||13 – 15 Points||$1,500|
|CDA or one-year certificate/diploma in Early Childhood Education or Child Development||Base Requirement|
|Associate’s Degree in Early Childhood Education||3 Points|
|Bachelor’s Degree or above in a related field**||4 Points|
|Bachelor’s Degree or above in Early Childhood Education or Child Development||5 Points|
|12 clock hours of NDE verified/approved training||Base Requirement|
|15 clock hours of NDE verified/approved training||3 Points|
|24 clock hours of NDE verified/approved training||4 Points|
|30 clock hours of NDE verified/approved training||5 Points|
|At least 6 months of employment in an eligible program* during the tax year||Base Requirement|
|At least 1 year experience working in an early care and education environment (including 6 month base requirement)||3 Points|
|At least 2 years of experience working with children in an early care and education environment (including 6 month base requirement)||4 Points|
|At least 3 years of experience working with children in an early care and education environment (including 6 month base requirement)||5 Points|
*Eligible programs are defined as ones participating in Step Up to Quality (at a Step 1 rating or higher). Applicant must have worked in an eligible program for at least 6 months during the tax year.
**Related fields include Elementary Education, Early Childhood Special Education, Social Work, Nursing, Psychology, Human Development & the Family, Family Consumer Science, Youth Development, Mental Health/Counseling.
|Education||Early Childhood Teach with CDA||Base|
|Training||24 hours of training||4 Points|
|Work Experience||3 years of experience|
(including 6 months base requirement)
The tax credit will become available in the 2017 tax year to early childhood professionals who have attained at least the base requirements in the highest achievement in each category.