Nebraska – Taxability of Purchases Made with a Government Charge Card

SALT Report 1818 – The Nebraska Department of Revenue updated its sales tax guide regarding the taxability of charge card purchases made by federal government employees.  Generally, when the federal government is the direct purchaser of taxable property or services, the sale is exempt. However, purchases made by employees of the federal government are taxable, unless the purchase is made with an approved charge card.

Employee Purchases

Purchases made by federal government employees with a government issued charge card are exempt if the total amount charged is billed to the federal government.  If the charge card has the appropriate prefix and a sixth digit the employee may use the charge card transaction as the exemption certificate rather than completing Form 13-Nebraska Resale or Exempt Sale Certificate.

If the federal government employees’ charge card is not billed in total to the federal government those sales are taxable, even if the employee will be reimbursed for their expenses.

The guide provides a list of all approved credit cards as well as their identifying numbers that may be used for exempt purchases in the Federal GSA SmartPay 2 program.

For Further Information:

Nebraska Department of Revenue – Sales Tax Guide For Charge Card Purchases by United States Government Employees