Agricultural Economics Department


Date of this Version



Cornhusker Economics, University of Nebraska–Lincoln Extension, September 3, 2014


Copyright © 2014 University of Nebraska


The Nebraska State Legislature passed LB 96 this year making the sales of all repair and replacement parts used to repair agricultural machinery and equipment exempt from sales tax. This legislation will go into effect on October 1, 2014. Any repairs made prior to October 1, 2014 will still be subject to sales tax. Prior to that date, repairs that must be capitalized (put on your depreciation schedule) are still eligible for a refund. In other words, if you made a repair to a piece of farm equipment that substantially increased the value and life of the asset causing it to be classified as a capital purchase, you can file for a refund of the sales tax paid. This is the only way to get repairs free from sales tax prior to October 1, 2014.