Tax Credits

Individual Tax Credit

What is it?

A refundable tax credit for eligible staff and self-employed individuals working in programs that participate in Step Up to Quality.

Who can apply?

Anyone who meets or exceeds the base requirements in the areas of education, training and work experience can (and should!) apply for this tax credit. Use the charts below to see if you qualify — and how much your refund could be.

Note: Certified teachers working in public school programs are not eligible.

Classification Levels

Points Tax Credit
Level 1 All Base Requirements $540
Level 2 7 – 9 Points $810
Level 3 10 – 12 Points $1,350
Level 4 13 – 15 Points $1,620

These amounts may vary slightly depending on inflation.

Point Determination

Education Points
CDA or one-year certificate/diploma in Early Childhood Education or Child Development Base Requirement
Associate’s Degree in Early Childhood Education/Child Development 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
Training 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
Work Experience 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, Curriculum and Instruction, Social Work, Nursing, Psychology, Human Development & the Family, Family Consumer Science, Youth Development, Mental Health/Counseling.

Example

Education CDA Base
Training 24 hours of training 4 Points
Work Experience 3 years of experience
(including 6 month base requirement)
5 Points
Total 9 Points
Level Level 2
Tax Credit $810

How to Apply

  1. A tax credit attestation application must be completed in the Nebraska Early Childhood Professional Record System (NECPRS). The deadline to apply in NECPRS is February 1, 2022.
  2. Once received, the eligible staff member must submit their attestation form along with their Department of Revenue Staff Member Application to the Department of Revenue to apply for the tax credit by March 1, 2022.
  3. Claim your tax credit by attaching the tax credit certification from the Department of Revenue to your individual income tax return.

Watch a video tutorial on how to apply for your tax credit attestation form in NECPRS:

Child Care Program Tax Credit

There is also a nonrefundable tax credit available to eligible child care programs that have reached Steps 3-5 in Step Up to Quality and serve children who participate in the child care subsidy program. More information regarding the program tax credit can be found on the Nebraska Department of Revenue website.