Nebraska Sales Tax Nonpayment Risk Checklist

Nebraska Sales Tax Nonpayment Risk Checklist

Introduction

Sales tax nonpayment occurs when a Nebraska business or seller fails to pay sales and use tax owed to the state. This typically includes unpaid tax from actual sales, penalties that accumulate over time, and interest charges on the balance. The Nebraska Department of Revenue actively collects unpaid sales and use tax through notices, administrative actions, and enforcement procedures.

Understanding what nonpayment means and the state’s typical collection timeline helps you respond appropriately before enforcement escalates. Ignoring Nebraska sales tax penalties and interest can result in liens, wage garnishment, suspension of the sales tax permit, and other collection activities that become increasingly difficult to resolve.

What This Issue Means

Sales tax nonpayment means the state has identified an outstanding balance of unpaid sales and use tax, penalties, and interest owed by your business or entity. This tax liability can result from unreported or underreported sales, late or missed payments, or failure to file sales tax returns. The nonpayment status typically appears in state records when a tax return is not filed by the due date, a tax return is filed, but payment is not received, or previous collection efforts go unanswered.

Why the State Issued This or Requires This

The Nebraska Department of Revenue identifies nonpayment through routine account monitoring and filing systems. When a tax return is due and not filed, or when it is filed without an accompanying payment, the state’s system flags the account for failure to pay the applicable sales tax rate.

What Happens If This Is Ignored

If nonpayment is not addressed, the Nebraska Department of Revenue typically escalates collection procedures. Additional notices, further penalties and interest assessments, liens on business assets or personal property, tax refund interceptions, wage garnishment, asset

seizure, or sales tax permit suspension may follow. Under Nebraska Revised Statutes Section

77-2705, the Department of Revenue may revoke or suspend sales tax permits upon violation of sales tax statutes or regulations.

The state can pursue collection procedures to seize assets. In cases involving corporate officer assessments, responsible individuals may be held personally liable for the tax liability.

Accumulating Nebraska sales tax penalties and interest on your delinquent tax account causes the total amount owed to grow larger the longer nonpayment remains unresolved.

What This Does NOT Mean

A Nebraska Department of Revenue collection notice is an administrative notice indicating an outstanding tax debt that requires attention. Your sales tax permit has not already been suspended, and your personal assets have not been seized simply because you received this notice.

A nonpayment notice does not mean the state has yet filed a lawsuit or obtained a judgment.

Neither a warrant for arrest nor an eviction notice, this document serves as an administrative communication.

While receiving a nonpayment notice does not mean criminal penalties have been filed,

Nebraska Revised Statutes Section 77-2713 establishes that willful failure to collect or pay taxes, or willful attempts to evade the sales tax rate requirements, constitute criminal penalties as a Class IV felony. Civil penalties may also apply for failure to pay without criminal intent, and the state may pursue collection procedures against business assets.

Checklist: What to Do After Receiving This or Identifying

This Issue

Follow these steps to address nonpayment of Nebraska sales tax.

• Step 1: Locate and review all related documents

Gather the nonpayment notice or the Nebraska Department of Revenue collection notice from the state. Find copies of the sales tax returns in question if you filed them. Locate business records showing sales, tax collected at the applicable sales tax rate, and payments made during the period.

Check bank statements and payment confirmations for any sales tax payments already sent. Review any previous correspondence from the state regarding your delinquent tax account.

• Step 2: Verify the account details and amount owed

Confirm the tax period covered by the notice and verify the sales tax rate applied. Check the total tax liability listed, including penalties and interest.

• Step 3: Determine whether the debt is accurate

Compare the state’s reported tax liability to your business records. Identify whether you believe the tax liability is correct, partially correct, or incorrect.

• Step 4: Contact the Nebraska Department of Revenue if you have questions

Locate the phone number on the notice or the department’s website and request any necessary tax forms. Call during business hours to ask specific questions about the notice and collection procedures.

• Step 5: Determine your payment or dispute options

The Nebraska Department of Revenue has an online payment plan application system available for both individual and business taxpayers. Payment arrangements can be set up electronically through their online portal or by submitting Form 27D.

Review the notice for stated payment deadlines and identify whether you can pay the balance in full. Review any appeal or dispute procedures mentioned in the notice and understand that failure to pay by the deadline may result in enforcement actions.

• Step 6: If the debt is correct, arrange payment

Contact the Nebraska Department of Revenue to confirm payment methods and discuss payment arrangements. Obtain specific instructions for where and how to send payment to resolve your delinquent tax account.

• Step 7: If you believe the debt is incorrect, document your position

Write a clear explanation of why you believe the amount is wrong, including disputes about the sales tax rate applied. Gather supporting documents such as sales records, return copies, or payment proof.

Include specific figures and dates to support your explanation. Submit your written response by any deadline stated in the notice to avoid failure to pay penalties or criminal penalties.

• Step 8: Submit your response or payment before the deadline

Note the exact deadline on the notice. Submit payment or a written response well before the deadline to avoid criminal penalties or other enforcement.

• Step 9: After submission, monitor your account for follow-up

Watch for additional notices or responses from the state regarding collection procedures.

Processing times vary depending on the type of submission and case complexity.

Common Mistakes to Avoid

• Missing deadlines triggers additional penalties and collection actions. Submit responses

and payments well before stated deadlines.

• Sending incomplete information when disputing an amount makes it harder for the state

to review your position fairly. Include specific figures, dates, and supporting documents.

• Not keeping copies creates problems if the state questions what was sent. Retain

detailed records of everything, including tax forms.

• Assuming the notice is wrong without checking your own business records may cause

you to miss an actual issue that needs correction. Verify the debt using your own records first.

• Ignoring follow-up notices means responding only to the first notice does not resolve the

issue and may lead to criminal penalties or enforcement actions. Address each notice promptly.

• Paying by an unspecified method may result in the payment not being credited to your

account. Use only the techniques and addresses the state provides.

• Not requesting written confirmation can lead to misunderstandings about payment

arrangements or agreements, as reliance on verbal conversations alone can be

misleading—request written confirmation of any arrangements to avoid failure-to-pay situations.

Frequently Asked Questions

How much interest and penalties are added to unpaid sales tax?

The penalty for late filing or failure to pay is 10% of the unpaid tax or $25, whichever is greater.

For the period from January 1, 2025, through December 31, 2026, the interest rate on delinquent taxes is 8% per year.

How long does the state have to collect unpaid sales tax?

Nebraska’s statute of limitations for issuing a deficiency determination is three years from the later of the last day of the month following the tax period or when the return was filed. The timeframe extends to six years if the taxpayer fails to file a return, files a fraudulent return, or omits more than twenty-five percent of the tax due.

What happens if I already paid this, but the state shows it as unpaid?

Contact the Nebraska Department of Revenue with proof of payment, such as bank statements, canceled checks, or payment confirmations. The state can research your account and correct records if a payment was not correctly applied.

Facing State Tax Enforcement Action?

If you’ve received a notice related to sales tax or payroll tax enforcement, and aren’t sure how to respond, our team can help you understand your options and next steps.