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Nebraska: The Distinction between Lessors and Common Carriers


 Are you a lessor or common carrier? It matters in Nebraska.

Why is it important to determine if you’re a lessor or a common/contract carrier? Sales tax, of course!

Lessors

According to the Nebraska Department of Revenue:

  • A lessor must obtain a sales tax permit and collect Nebraska sales tax from their lessees. Lessors must also complete a Nebraska and Local Sales and Use Tax Return and file it by the due date, even if the amount due is zero.
  • A common / contract carrier must obtain a Nebraska Common/Contract Carrier Exemption Certificate, which must be renewed every five years.

You’re considered to be a lessor if:

  • Control and use of the vehicle is determined by the lessee; and
  • The vehicle is leased 100% of the time.

Lessors are permitted to purchase “the vehicle and any repair or replacement parts for the leased vehicle tax-exempt.” A Nebraska Resale and Exempt Sale Certificate must be provided to the seller at the time of purchase in order for the exemption to be valid.

Common/contract carriers

You’re considered to be a common/contract carrier if:

  • The vehicle “is used more than 50% of the time to transport the goods of others, or passengers, for hire.”

Common/contract carriers may purchase without sales tax the vehicle and repair or replacement parts and accessories. In order for the exemption to be valid, a Nebraska Resale and Exempt Sale Certificate must be provided to the seller.

Additional information is available on the department’s website.

How do you manage sales tax and sales tax exemption certificates? An automated solution makes it simple.

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Sales tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Gail Cole
Avalara Author
Gail Cole
Gail Cole
Avalara Author Gail Cole
Gail began researching and writing about sales tax in 2012 and has been fascinated with it ever since. She has a penchant for uncovering unusual tax facts, and endeavors to make complex sales tax laws more digestible for both experts and laypeople.