Neb. Admin. Code § 316-24-311 — Sales Factor; In General

311.01 Determining Sales. Sales means gross receipts, less returns and allowances, and includes all interest income, service charges, carrying charges, or time-price differential charges related to sales. Federal and state excise taxes (including sales taxes) must be included as part of gross receipts if the taxes are passed on to the buyer or included as part of the selling price of the product. The following are rules for determining sales for business entities. 311.01A Exclusions from sales. The sales factor does not include: 311.01A(1) Any sales made in producing income that is nonapportionable; 311.01A(2) Income from discharging indebtedness; 311.01A(3) Amounts received from hedging transactions involving intangible assets; or 311.01A(4) Net gains from marketable securities held for investment. 311.01B Sales applicable to particular businesses. 311.01B(1) For a taxpayer that manufactures or purchases goods or products for sale, sales means all gross receipts from the sales of goods or products (or other property of a kind which would properly be included in the inventory if on hand at the close of the tax period) held for sale to buyers. 311.01B(2) For a cost plus fixed fee contract (for example, operating a government-owned plant for a fee) sales means the entire reimbursed cost, plus the fee. 311.01B(3) For providing services for buyers, or performing equipment service contracts or research and development contracts, sales means the gross receipts from providing these services including fees, commissions, and similar charges. 311.01B(4) For renting real or tangible property, sales means the gross receipts from renting, leasing, or licensing the use of the property. 311.01B(5) Sales means receipts from the sales of equipment used in the business. 311.01B(6) For licensing or assigning intangible property (for example, copyrights or patents) sales means the gross receipts from the licensing or assignment. 311.01B(7) For sales of intangible property, sales means the net gain from the sales of all intangible property. Any net loss on sales of all intangible property is not included in the factor. 311.02 Changes in the Items in the Factor. If the taxpayer departs from or modifies the basis for excluding or including gross receipts in the sales factor used in returns for prior years, the return for the current year must disclose the nature and extent of the modification. 311.03 Inconsistent Reporting of Items in the Factor. If the returns or reports filed with all states with laws similar to Nebraska in which the taxpayer reports are not uniform in including or excluding items from the sales factor, the Nebraska return must disclose the nature and extent of the variance. 311.04 Denominator. The denominator of the sales factor includes the total sales of the taxpayer. If the sales factor is to be calculated for a unitary group, the denominator of the sales factor includes the total sales of all members of the unitary group. 311.05 Numerator. The numerator of the sales factor includes sales of the taxpayer that are attributable to Nebraska. All interest income, service charges, carrying charges, or time-price differential charges are included regardless of the place where the accounting records are maintained or the location of the contract or other evidence of indebtedness. (Neb. Rev. Stat. §§ 77-2734.04 and 77-2734.14. December 27, 2015.)