Sections 77-7001 to 77-7008 shall be known and may be cited as the Nebraska Higher Blend Tax Credit Act.

For purposes of the Nebraska Higher Blend Tax Credit Act:

(1) Department means the Department of Revenue;

(2) E-15 means ethanol blended gasoline formulated with a percentage of more than ten percent but no more than fifteen percent by volume of ethanol;

(3) E-25 means ethanol blended gasoline formulated with a percentage of twenty-five percent by volume of ethanol;

(4) E-30 means ethanol blended gasoline formulated with a percentage of thirty percent by volume of ethanol;

(5) E-85 means ethanol blended gasoline formulated with a percentage of fifty-one percent to eighty-three percent by volume of ethanol;

(6) Motor fuel pump means a meter or similar commercial weighing and measuring device used to measure and dispense motor fuel originating from a motor fuel storage tank;

(7) Retail dealer means a person engaged in the business of storing and dispensing motor fuel from a motor fuel pump for sale on a retail basis;

(8) Retail motor fuel site means a geographic location in this state where a retail dealer sells and dispenses motor fuel from a motor fuel pump on a retail basis; and

(9) Taxpayer means any natural person or any limited liability company, partnership, private domestic or private foreign corporation, or domestic or foreign nonprofit corporation certified pursuant to section 501(c)(3) of the Internal Revenue Code of 1986, as amended.

(1) Any taxpayer who is a retail dealer and who sold and dispensed E-15 or higher blend on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site shall be eligible to receive tax credits under the Nebraska Higher Blend Tax Credit Act.

(2)(a) Through calendar year 2023, the tax credit shall be in an amount equal to (i) five cents multiplied by the total number of gallons of E-15 sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site and (ii) eight cents multiplied by the total number of gallons of E-25 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(b) For calendar year 2024, the tax credit shall be in an amount equal to eight cents multiplied by the total number of gallons of E-15 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(c) For calendar year 2025, the tax credit shall be in an amount equal to nine cents multiplied by the total number of gallons of E-15 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(d) For calendar year 2026, the tax credit shall be in an amount equal to eight cents multiplied by the total number of gallons of E-15 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(e) For calendar year 2027, the tax credit shall be in an amount equal to seven cents multiplied by the total number of gallons of E-15 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(f) For calendar year 2028, the tax credit shall be in an amount equal to five cents multiplied by the total number of gallons of E-15 or higher blend sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site.

(3) The tax credit shall be a refundable credit that may be used against any income tax imposed by the Nebraska Revenue Act of 1967 or any tax imposed pursuant to sections 77-907 to 77-918 or 77-3801 to 77-3807.

(4) Tax credits allowed under this section may be claimed for taxable years beginning or deemed to begin on or after January 1, 2022, under the Internal Revenue Code of 1986, as amended.

(5) To receive tax credits, a taxpayer shall submit an application to the department on a form prescribed by the department. The application shall include the following information:

(a) The name and address of the taxpayer;

(b) The total number of gallons of E-15 sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site;

(c) The total number of gallons of E-25 sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site;

(d) The total number of gallons of E-30 sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site;

(e) The total number of gallons of E-85 sold by the taxpayer on a retail basis during the prior calendar year through a motor fuel pump located at the taxpayer's retail motor fuel site; and

(f) Any other documentation required by the department.

(1) If the department determines that an application is complete and that the taxpayer qualifies for tax credits, the department shall approve the application within the limits set forth in this section and shall certify the amount of tax credits approved to the taxpayer.

(2) The department shall consider applications in the order in which they are received and may approve tax credits until the annual limit for the calendar year has been reached. For calendar year 2022, the annual limit on tax credits shall be two million dollars. For calendar year 2023, the annual limit on tax credits shall be calculated by taking the annual limit from the prior calendar year and then multiplying such amount by (a) two hundred percent if the amount of tax credits approved in the prior calendar year exceeded ninety percent of the annual limit applicable to that calendar year or (b) one hundred percent if the amount of tax credits approved in the prior calendar year did not exceed ninety percent of the annual limit applicable to that calendar year. For calendar years 2024 through 2028, the annual limit on tax credits shall be five million dollars.

(1) A taxpayer shall claim the tax credit by attaching the tax credit certification received from the department under section 77-7004 to the taxpayer's tax return.

(2) Any credit in excess of the taxpayer's tax liability shall be refunded to the taxpayer. In lieu of claiming a refund, the taxpayer may elect to have the excess carried forward to subsequent taxable years. A taxpayer may carry forward the excess tax credits until fully utilized.

Any tax credit allowable to a partnership, a limited liability company, a subchapter S corporation, or an estate or trust may be distributed to the partners, limited liability company members, shareholders, or beneficiaries in the same manner as income is distributed.

There shall be no new applications filed under the Nebraska Higher Blend Tax Credit Act after December 31, 2028. All applications and all tax credits pending or approved before such date shall continue in full force and effect.

The department may adopt and promulgate rules and regulations to carry out the Nebraska Higher Blend Tax Credit Act.