Nebraska Auction Law

Nebraska is a state in the Midwestern region of the United States. It is bordered by South Dakota to the north; Iowa to the east and Missouri to the southeast, both across the Missouri River; Kansas to the south; Colorado to the southwest; and Wyoming to the west. It is the only triply landlocked U.S. state.  

Indigenous peoples, including Omaha, Missouria, Ponca, Pawnee, Otoe, and various branches of the Lakota (Sioux) tribes, lived in the region for thousands of years before European exploration. The state is crossed by many historic trails, including that of the Lewis and Clark Expedition.

Nebraska’s area is just over 77,220 square miles (200,000 km2) with a population of over 1.9 million. Its capital is Lincoln, and its largest city is Omaha, which is on the Missouri River. Nebraska was admitted into the United States in 1867, two years after the end of the American Civil War. The Nebraska Legislature is unlike any other American legislature in that it is unicameral, and its members are elected without any official reference to political party affiliation.

Nebraska Auction

If an auction is held prior to the expiration of a liquor license that allows off premise sale of alcohol, the auctioneer may act as an agent for the licensee, selling the alcohol stock as any licensee normally would. If the auction is held after expiration of the license, or if the license only allows for on premise consumption, permission for the auction must be obtained from the Liquor Control Commission before the auction. Requests for permission must be made in writing prior to the date of the sale, and must include the date, time and location of the auction.

Persons selling or buying commemorative or uniquely designed containers of alcohol are not required to have a liquor license; and, an auctioneer may act as agent for such sales.

Opened containers may not leave any licensed premise by state law. The seller might want to give consideration to destroying these containers to ensure compliance with the law.

At the time of purchase all buyers must register with their name, address, date of birth and legally acceptable form of identification.

All retail licensees, licensed by the Liquor Control Commission who are purchasing alcohol must register with their business name, business address and liquor license number.

Sales of alcohol to licensees may be approved, a written request for such a transfer must be made to the Liquor Control Commission as soon as possible. The request must contain an inventory of the alcohol purchased. The approved affidavit and forms for such sales may be downloaded from this web site.

Auction, defined.

Auction means a sale of motor vehicles and trailers of types required to be registered in this state, except such vehicles as are eligible for registration pursuant to section 60-3,198, sold or offered for sale at which the price offered is increased by the prospective buyers who bid against one another, the highest bidder becoming the purchaser. The holding of a farm auction or an occasional motor vehicle or trailer auction of not more than two auctions in a calendar year does not constitute an auction subject to the Motor Vehicle Industry Regulation Act.

Sales and Use Tax for Auction 

An auction is a sale of land, property, or services to the highest bidder. An auctioneer is a person authorized to sell property and services at auction for a commission or fee. Auctioneers are retailers and must obtain a Nebraska Sales Tax Permit. Auctioneers are required

to collect and remit the appropriate sales tax on all sales, unless a specific exemption applies. The

auctioneer must retain documentation in his or her business records supporting all non-taxed sales. If another person acts as a clerk for an auction and handles the money for the sale, the clerk is the retailer and is required to obtain a Nebraska Sales Tax Permit. The clerk is required to collect and

remit the appropriate sales tax on all sales, unless a specific exemption applies. The clerk must retain

documentation in his or her business records supporting all non-taxed sales.

Auctions for Licensed Retailers.

When auctions are conducted for customers who are licensed retailers, the auctioneer, under a contract or for hire, becomes an agent for their customer. The auctioneer’s customer, the retailer, is responsible for collecting and remitting the tax. 

Auctions for Nonprofit Organizations. 

Items sold at auctions conducted, supervised, or aided by an auctioneer, under a contract or for hire, are subject to sales tax. Please see the “Resource List” at the end of this Guide for additional information on which types of entities are exempt from tax

Sales tax is to be collected on the full amount of the bid when a donation and the fair market value of the property sold are not separately stated on the receipt given to the buyer. Fair market value must be determined prior to the auction. An auctioneer is permitted to collect tax on only the fair market value of the property sold when a donation and the fair market value of the property sold are separately stated on the receipt given to the buyer. The donation is calculated by subtracting the fair market value from the total bid price of the property. Sales of gift baskets which are donated to the nonprofit organization are generally subject to tax. 

Sales of gift baskets purchased or made by the nonprofit organization are also taxable, unless more than 50 percent of the nonprofit  organization’s cost of the gift basket and contents consist of exempt food items.  Gift certificates are not taxed when sold at auction, but rather the item purchased with the gift certificate is taxed when the certificate is used. A gift certificate allows the recipient to purchase any item or service at the retailer’s store

Agents treated as vendors; joint responsibility

When the Tax Commissioner determines that it is necessary for the efficient administration of the Nebraska Revenue Act of 1967 to regard any salespersons, representatives, peddlers, canvassers, or auctioneers and persons conducting auction sales as the agents of the dealers, distributors, supervisors, or employers under whom they operate or from whom they obtain the property sold by them irrespective of whether they are making sales on their own behalf or on behalf of such dealers, distributors, supervisors, auctioneers, or employers, the Tax Commissioner may, at his or her discretion, treat such agent as the vendor jointly responsible with his or her principal, distributor, supervisor, or employer for the purposes of the Nebraska Revenue Act of 1967.

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