2006 News

NMPF and NEON Co-Sponsor Dynamic Meeting

The Nebraska Enterprise Opportunity Network and the Nebraska Microenterprise Partnership Fund sponsored the Entrepreneurs: Building Business & Wealth in Nebraska on December 7, 2006 in Lincoln. The total attendance was comprised of 52 senators, senators’ staff, economic developers and micro program staff. This meeting was the culmination of work by the Nebraska Self-employed Tax Initiative (including NMPF staff, NEON members, and other economic developers) over the last year.

An early morning breakfast was followed with background on the micro industry in Nebraska, challenges to that industry and the need for greater state support if more entrepreneurs are to be reached in the future.

Eileen Curry of Great Plains Family Counseling and Jeff Dousharm of Tiger Rock TaeKwonDo Academies spoke on the value of micro program services from Vocational Rehabilitation Equity Assistance Program and Community Development Resources is starting and growing their businesses. Both business owners overcame major obstacles to be self-employed and are pleased with the financial rewards being in business brings.

Jon Bailey of the Center for Rural Affairs provided an update on the Microenterprise Tax Credit and it’s use in the first year. The Center is pursuing minor adjustments to the bill in the 2007 Legislative session. Jon also discussed the 2007 Farm Bill as an opportunity to divert new funding to rural development.

New research on use of the tax code to reach start-up entrepreneurs was presented by Gene Severens. Gene pointed out that the tax code could be used in three ways to support start-up entrepreneurs – 1. to improve the level of business tax literacy; 2. for low-income start-up business in recognizing the role that the EITC can play; and 3. considering the possibility of a new kind of self-employed tax credit in the future.

Ed Leahy and Julie Kalkowski of Family Economic Success Initiative shared information on the formation an Asset Building Coalition in Nebraska. ABC will provide an opportunity for NEON to share in other policy work in the state, while drawing support from a larger coalition for microenterprise issues. Julie also talked about a new pilot effort in Omaha and Lincoln to assist first time filers in the preparation of Schedule C.

Participants in the morning session expressed interest in more gatherings of this type. The meeting allowed for excellent networking with Legislative members, while providing new information for future development.

NEON members gathered for lunch following the morning meetings and concluded with the yearly Annual Meeting. Rose Jaspersen
 


 

Community Economic Development Opportunity Grants for Your Community

The Building Entrepreneurial Communities (BECA) grant program is now available for communities across Nebraska.  The purpose of the BECA program is to help economically depressed rural areas of Nebraska build entrepreneurial communities through grants that will create community capacity to build and sustain programs to generate and retain wealth in the community and region.

Eligible applicants include every local government (municipality or county). At least two local governments must collaborate on the project. At least one of the local governments must have chronic economic distress as indicated by:

            · An unemployment rate which exceeds the statewide average unemployment rate;                 · A per capita income below the statewide average per capita income; or
            · Severe historical population loss, which means a population loss of ten percent
                 or more over a twenty-year period of time (see listing of counties with
                 chronic economic distress below)

Eligible activities must be projects that address one of the following:

               Provide education and technical assistance to energize small business
                  development and entrepreneurship
·              Provide technical assistance to facilitate small business transfer;
·              Build community business capacity and leadership programs;
·              Generate opportunities that will attract and retain young people and families;
·              Provide education about philanthropy and intergenerational transfer of wealth;
                    and
·               Build community endowments to support these activities.


The application deadline is August 1, 2006, to apply for a Building Entrepreneurial
Communities (BECA) grant!  $360,000 is available in grant money for eligible applicants.

Grant recipients shall provide a dollar-for-dollar cash match. Matching funds shall be from sources other than state and federal programs.  Grant application for complete with qualifying towns and counties can be found at:

                     http://rdc.neded.org/library/BECA_App_Guideline2006.doc 

Contact Linda Fettig, Rural Development Commission, 308-749-2291 (phone and cell)
linda.fettig@ded.ne.gov to find out more about this opportunity.

Counties - Chronic Economic Distress:
Antelope, Arthur, ,Banner, Blaine, Boone, Box Butte, Boyd, Brown, Burt, Butler, Cedar, Chase, Cherry, Clay, Colfax, Custer, Dakota, Dawes, Dawson, Deuel, Dundy, Fillmore, Franklin, Frontier, Furnas, Garden, Garfield, Grant, Greeley, Hall, Harlan, Hayes, Hitchcock, Holt, Hooker, Jefferson, Johnson, Kearney, Keya Paha, Kimball, Knox,
Lincoln, Logan, McPherson, Madison, Morrill, Nance, Nemaha, Nuckolls, Otoe,
Pawnee, Perkins, Polk, Red Willow, Richardson, Rock, Scotts Bluff, Sheridan,
Sherman, Sioux, Thayer, Thomas, Thurston, Valley, Webster, and Wheeler.

 

Seven Techquity Awards Made, 23 to go… (cover story)

New Community Development Corporation (NCDC) has made seven techquity awards provided by the eBay Foundation Techquity Program. These awards have been used by seven business owners to purchase a total of more than $11,000 in technology equipment or software. The average award size is $1225.00 with the maximum net award amount of $1550.00. The awards covered nearly 80% of the purchase price of the technology; the entrepreneurs covered approximately 20% of the cost. Many of the owners have also taken advantage of the technological training available. We are partnered with Creighton University at Bryant Center and Metropolitan Community College to provide technology training for our clients. Again, we will cover 80% of the cost of the class with the clients paying 20%.

Here is what Barbara Carlisle, a techquity awardee, had to say about the program: “As a small business owner of Bright ‘N’ Clean I didn’t know where to start. There were so many questions that needed to be answered and no one to answer them. I was introduced to NCDC by a member that was currently attending the small business development training classes. She informed me of the date and time of the next class and I signed up at a fee that was affordable. Attending this class answered questions I [had] to keep my business going in the right direction.

NCDC also provides other helpful resources that can help you succeed like the eBay Techquity Award, setup to help business owners like me to become more efficient …with the right software and equipment to do it.

Thanks goes out to NCDC…, eBay [Foundation] and all others who help business owners get off to the right start. May God bless you to keep helping other business owners who don’t know how to get started.”

With her techquity award Barbara was able to purchase a new computer, printer, and software from Office Depot. She later went on to attend technology classes at Creighton University at Bryant Center to teach her how to operate her computer and the software on it.

We want to make an award to you. If you are a current business owner that is a NCDC client, past or present, and are in need of technology, contact us to receive an application. Once it is initially screened, you will receive the remaining instructions detailing what you will need to submit to complete the process. You have nothing to lose. So, please, don’t let this opportunity pass you by. We have made seven techquity awards; need to make 23 more by the end of July 2006. Wouldn’t it be foolish to not take advantage of such a rare offering? Contact us today!

For information about the program, please call Tamara Westbrook at 451-2939.

 

Nebraska Advantage

Microenterprise Tax Credit Act

 

            The Nebraska Legislature passed a bill in the 2005 session to provide tax credits for micro businesses in Nebraska.  The following information sets out details regarding this act.  An application to receive the tax credits may be obtained at the Nebraska Department of Revenue website at www.revenue.ne.gov or call 402-472-5790.

What is the Nebraska Advantage Microenterprise Tax Credit Act?

This is a refundable tax credit.  The credit is 20% of new investment or employment.

A new investment is increase in purchases of buildings and depreciable personal property other than vehicles.  Leased property works under this program.  An increase in average net annual rents multiplied by years of the lease not to exceed 10 years. 

Examples – purchased $40,000 in equipment last year and purchased $100,000 this year

 $60,000 x 20% = $12,000 for a maximum credit of $10,000.

-          Renewed building lease fore three years.  The annual lease payment increased from $36,000 per year to $48,000 per year - $12,000/year x 3 years x 20% = $7,200 credit

-          The three resident employees each received a $1,500 raise in the year of application - $1,500 x 3 employees x 20% = $900 credit

New employment qualifies under this program.  An increase in compensation over compensation in the tax year prior to application qualifies.  This is not only new employees, but also existing employees.

There is a life time limit of $10,000 for the applicant and related party.  Related parties include unitary group, Section 267(b) and (c), Section 707 (b) of IRC, parent, child and sibling. 

The reported information includes the total authorized, used and expired credits and amount of employment and investment made.
 

  • An application is required (see contact information above) but there is not a fee.
  • Applications may be filed for calendar years beginning 1/1/06 through 12/31/10
  •  The total limit for the program per year is $2 million.  The Nebraska Department of Revenue may carry-over credits that were not granted in the prior year in addition to the $2 million limit. 
  • Applicants may not be participating in Nebraska Advantage, Nebraska Advantage Rural or LB775 for the same tax years.

What must I do to qualify?

  • Applicant must be actively involved in microbusiness with five or fewer employees (not a test by new location but by owner).  The current definition of five employees is five people, not five full-time equivalents.  The Legislature is considering a change to this definition in the 2006 session.
  • Operate in a distressed area, federal enterprise zone or census tract wit6h less than 80% statewide per capita income  – all areas of the state except for parts of Washington, Douglas, Sarpy, Lancaster, Kearney, and Scotts Bluff Counties.  Check with Department of Revenue website at www.revenue.ne.gov to be sure your area qualifies.
  • Must be a taxpayer subject to income tax or at least 90% of owners of the flow-thru entity are subject to income tax
  • The question is not what activity the business performs.  For example:  retailers, contractors, dentists, farmers are all allowable, in addition to other business types.

 The total lifetime credits claimed by any taxpayer and any related person is $10,000.  For example, if two brothers apply for separate and distinct business activities, they cannot both claim $10,000 credit.