Nebraska’s Caregiver Tax Credit Act Passes Legislation

The Nebraska Legislature’s proposed Caregiver Tax Credit Act (Legislative Bill 937) passed final reading on April 18, 2024, and now awaits Governor Pillen’s signature to become law.

The Caregiver Tax Credit Act would help ensure family members who take care of their relatives with disabilities—incurring eligible expenditures for their care and support—are paid for their critical caregiving work through a nonrefundable tax credit.

The credit is for taxable years beginning after January 1, 2025. The amount of the credit shall be equal to 50% of the eligible expenditures incurred during the taxable year. The maximum allowable credit in any single tax year for a family caregiver shall be $2,000 unless the eligible family member is a veteran or has a diagnosis of dementia in which case the maximum allowable credit shall be $3,000. The first two years of the tax credit would cap the amount available at $1.5 million with an increase in year three to $2.5 million.

Todd Stubbendieck, State Director of AARP Nebraska, shared “This is a great day for Nebraska caregivers. When lawmakers agree on an issue regardless of political affiliation, the message is clear. AARP is proud of the Nebraska Legislature for recognizing this critical need to help our state’s unsung heroes.”

State Senator Eliot Bostar who both introduced and selected LB937 as his priority bill this session, explained “Caregiving is a critically important public health issue that affects the quality of life for millions of individuals nationally and thousands across Nebraska.”

For Nebraska’s 179,000 family caregivers, it’s decidedly a labor of love, but the experience is stressful, isolating, and has a real financial cost—with households spending on average more than $7,200 annually. Nebraska family caregivers provide over 168 million hours of care valued at a staggering $2.8 billion, which helps mitigate more costly taxpayer-funded long-term care and nursing home stays.

This is a huge win for Nebraska caregivers who eagerly await the final step to get this tax credit across the finish line. The governor has five days, excluding Sundays, to decide what to do with the bill. If the governor signs a bill or declines to act on it, the bill becomes a state law.