Don’t Lose Your Property Tax-Exempt Status: A New Law Creates a Potential Pitfall for Nebraska Non-Profits

Under Nebraska law, an organization seeking tax-exempt status for its real or personal property must apply for an exemption with the County Assessor on or before December 31 of the year preceding the year for which the exemption is sought using forms prescribed by the Tax Commissioner. Form 451, or 451A for renewals, requires a non-profit applicant to estimate the value of the real and personal property it is claiming is exempt from taxation. In previous years, some applicants did not list the value of their property in their applications, but the applications were accepted, nonetheless.

LB 521, codified at Neb. Rev. Stat. § 77-202.01(1), now makes it clear that an applicant for a property tax exemption who fails to list the value of the property will have their application denied. “Applications that lack an estimated valuation, or any other required information, shall result in the denial of the requested exemption.” Neb. Rev. Stat. § 77-202.01(1).

Going forward, to obtain or maintain property tax-exempt status it will be crucial that applicants list an estimated value of their property. A simple omission of the estimated value will now result in your organization’s application being denied. It is important that tax-exempt organizations begin preparing estimates of the value of its real and personal property well ahead of the December 31 filing deadlines.

Fraser Stryker’s attorneys are well-versed in assisting charitable and tax-exempt organizations through the process of obtaining and renewing property tax-exempt status. Please note, nothing in LB 521 affects income tax exemptions, which are obtained through a separate application process through the IRS.