November 30, 2015

The IRS issues new warnings to taxpayers about identity theft

IRS LogoThe Internal Revenue Service is launching a campaign with the Nebraska Department of Revenue and the state’s private sector tax industry to nudge Nebraskans into taking more precautions with their sensitive financial information.

Christopher Miller, a spokesman for the IRS in Nebraska, says identity thieves are becoming more sophisticated all the time and taxpayers need to keep up or they may become victims.

“We want to encourage people when they file their taxes at home and whenever they’re working with personal information at home, to use security software to protect their computers,” Miller says. “That includes firewalls and anti-virus protection.”

Authorities say ID thieves are using personal data from real taxpayers to create fake state and federal tax returns to claim real refunds. Miller says Nebraskans have to be on guard for crooks who are trolling to rip you off using telephone and email “phishing” cons.

“If you get a call from someone posing as an IRS agent and they threaten you with jail or lawsuits, it’s a scam, hang up,” Miller says. “We also want to encourage people to protect their personal information. Do not routinely carry your Social Security number.”

Also, oversharing on social media gives identity thieves even more personal details. The new IRS campaign is called “Taxes. Security. Together.” and it aims to raise public awareness that even routine actions on the Internet and with personal electronic devices can affect the safety of financial and tax data.

“Your tax returns are sensitive data so you have to treat that information just like you would cash, don’t leave it laying around,” Miller says. “Properly dispose of old tax returns and other sensitive documents by shredding them before you put them in the trash.”

The campaign includes several components, including YouTube videos, consumer-friendly Tax Tips each week and local events. Several IRS publications are being added or updated to help taxpayers and tax professionals at, state web sites and platforms used by the tax preparation community.

The campaign will continue through the April tax deadline.

Omaha city councilman pushing for expanded city wheel tax

One Omaha City Councilman introduced a proposal that would require residents that live within three miles of the city limits to pay Omaha’s wheel tax. Franklin Thompson says in turn, they would be allowed to vote in city elections. This requires approval of the Legislature and Thompson says the sooner it can be brought to their attention the better.

Thompson says, “Part of what we have to do is guard against the message that we are sending because if it seems we’re divided here in Omaha, they are going to push this thing back 10, 20 years. So, we have to consistently push for what we need and what we deserve even though we know it will be tough sledding getting it. If we push hard and almost get it and we come back next year and we will get it, that is the strategy that we have to take.”

Thompson says some of his colleagues believe that allowing these residents to vote would upset the Republican, Democrat balance in the city. He says other opposition to his proposal is pretty basic and that is people don’t want to pay taxes but still want their streets fixed. He says, “I guess the tooth fairy is going to pay for it.”

Legislators consider options to cut property taxes & still fund schools

Sen. Roy Baker

Sen. Roy Baker

Members of two key legislative committees are meeting this week, looking at alternatives to property taxes to support schools. Nebraskans are complaining about the burden of property taxes in the face of higher valuations on farm land.

State Senator Roy Baker, of Lincoln, says one idea is to keep state spending increases in check and utilize revenue above the rate of spending to help pay for public education.

Baker says, “Under Governor Ricketts’ master plan, we would keep the overall state budget to somewhere around 3% increases per year and then hopefully, revenues to the state would be in the 5% range which, over time, could create some money that would be available to do just that.”

A former school superintendent, Baker says homeowners and property owners could see a rollback in their property taxes, under the plan.

“There’s concern among some that we don’t just want to give this money to the schools and let them keep leveeing the same taxes,” Baker says. “There’s going to have to be some way of demonstrating that if more state money goes to schools, then they have to be able to show that they’ve reduced property taxes by that amount.”

Baker says there’s some support for the idea of a greater use of income tax or sales tax revenue toward education. Last session, legislators approved an increase in the property tax relief fund. Baker says a tougher sell would be raising income or sales tax rates.

Other options include removing some sales tax exemptions or taxing some services. Baker sees little support for a sales tax on food because it tends to hurt those at lower incomes. Taxing junk food has been discussed. Another suggestion is expanding gambling, including online gambling, something Baker does not support.

“A whole lot of college students have become addicted to that type of thing,” Baker says. “They’re staying up all hours, neglecting their studies and the belief is it’s leading to more failures in college, more people dropping out of college.”

Baker opposes further spending restrictions on school districts, saying districts need to maintain local control of their operations. Education and Revenue Committee members of the legislature are meeting in the interim, to fashion possible proposals for the upcoming session. Meetings are scheduled for Wednesday and Thursday.

By Doug Kennedy, KWBE, Beatrice


Ralston Arena debt problems continue

The city of Ralston is in a financial dilemma due to their arena and officials are looking at the Legislature for help. Ralston is already receiving a turn-back tax and gets 70% of the state sales tax from businesses within 600 yards of the arena that opened shortly before or after it was built.

Jim Vokal is the Executive Director for the Platte Institute for Economic Research and says that is very generous turn-back money and wanting more is a stretch. He says now they want to expand that to 1,000 yards and 10 years within the arena opening.

Vokal says, “Where we have local decision making we should also have local accountability. I don’t think that the residents of Chadron who are looking for increased educational funding or someone in Lincoln County needs additional infrastructure funding should have to subsidize Ralston any further.”

Vokal adds Ralston officials need to come up with their own solution and unfortunately that could mean an increase in property or sales tax or an additional restaurant tax to offset losses.

Nebraska in top 5 states for fiscal health

A new report shows Nebraska is one of the top five states regarding fiscal health.   Platte Institute for Economic Research Executive Director Jim Vokal says ranked 4th best for cash position in the country and tied for 4th place when it comes to reliability of revenue.

Vokal says Nebraska has $780-million in cash reserves but Nebraskans are still not seeing across the board tax cuts for middle class residents. He says Nebraska has the highest income tax rate from North Dakota to Texas and is the 13th highest for property tax collections.

Vokal says, “There is a lot of pressure from senators and outside interest groups to carve out exemptions for certain groups but not for the middle class where it is needed most.”

Vokal believes the overall Legislature would like to debate a broad based tax reform bill but the Revenue Committee showed last session they are more interested in carving out deductions and tax breaks for car washes and certain property owners.