Sections 77-3163 to 77-3166 shall be known and may be cited as the Caregiver Tax Credit Act.

For purposes of the Caregiver Tax Credit Act:

(1) Activities of daily living includes:

(a) Ambulating, which is the extent of the ability of an individual to move from one position to another and walk independently;

(b) Feeding, which is the ability of an individual to feed oneself;

(c) Dressing, which is the ability of an individual to select appropriate clothes and to put the clothes on without aid;

(d) Personal hygiene, which is the ability of an individual to bathe and groom oneself and maintain dental hygiene and nail and hair care;

(e) Continence, which is the ability to control bladder and bowel function; and

(f) Toileting, which is the ability of an individual to get to and from the toilet without aid, using it appropriately, and cleaning oneself;

(2)(a) Eligible expenditure includes:

(i) The improvement or alteration to the primary residence of the family caregiver or eligible family member to permit the eligible family member to live in the residence and to remain mobile, safe, and independent;

(ii) The purchase or lease of equipment by the family caregiver, including, but not limited to, durable medical equipment, that is necessary to assist an eligible family member in carrying out one or more activities of daily living; and

(iii) Other paid or incurred expenses by the family caregiver that assist the family caregiver in providing care to an eligible family member such as expenditures related to:

(A) Hiring a home care aide;

(B) Respite care;

(C) Adult day care;

(D) Personal care attendants;

(E) Health care equipment; and

(F) Technology.

(b) The eligible expenditure shall be directly related to assisting the family caregiver in providing care to an eligible family member. Eligible expenditure shall not include the carrying out of general household maintenance activities such as painting, plumbing, electrical repairs, or exterior maintenance;

(3) Eligible family member means an individual who:

(a) Requires assistance with at least two activities of daily living as certified by a licensed health care provider;

(b) Qualifies as a dependent, spouse, parent, or other relation by blood or marriage to the family caregiver; and

(c) Lives in a private residence and not in an assisted-living center, nursing facility, or residential care home; and

(4) Family caregiver means an individual:

(a) Providing care and support for an eligible family member;

(b) Who has a federal adjusted gross income of less than fifty thousand dollars or, if filing as a married couple jointly, less than one hundred thousand dollars; and

(c) Who has personally incurred uncompensated expenses directly related to the care of an eligible family member.

(1) For all taxable years beginning on or after January 1, 2025, there shall be allowed a credit against the income tax imposed by the Nebraska Revenue Act of 1967 to any family caregiver who incurs eligible expenditures for the care and support of an eligible family member.

(2) The amount of the credit shall be equal to fifty percent of the eligible expenditures incurred during the taxable year by a family caregiver for the care and support of an eligible family member.

(3) The tax credit allowed under this section shall be a nonrefundable credit. Any amount of the credit that is unused may not be carried forward.

(4) The maximum allowable credit in any single taxable year for a family caregiver shall be two thousand dollars unless the eligible family member is a veteran or has a diagnosis of dementia in which case the maximum allowable credit shall be three thousand dollars. If two or more family caregivers claim the tax credit allowed by this section for the same eligible family member, the maximum allowable credit shall be allocated in equal amounts between each of the family caregivers.

(5) A family caregiver shall apply for the tax credit allowed under this section by submitting an application to the Department of Revenue, on a form prescribed by the department, with the following information:

(a) Documentation of the eligible expenditures incurred for the care and support of an eligible family member; and

(b) Any other documentation required by the department.

(6) If the Department of Revenue determines that the family caregiver qualifies for the tax credit under this section, the department shall approve the application and certify the amount of the approved credit to the family caregiver.

(7) The Department of Revenue shall consider applications in the order in which they are received and may approve tax credits under this section each fiscal year until the total amount of credits approved for the fiscal year equals one million five hundred thousand dollars for fiscal years 2025-26 and 2026-27 and two million five hundred thousand dollars for any fiscal year thereafter.

The Department of Revenue may adopt and promulgate rules and regulations necessary to carry out the Caregiver Tax Credit Act.