Nebraska SMB Mergers & Acquisitions in 2026: A Complete Legal and Tax Guide for Owners, Buyers, and Sellers

By Tom Horgan, Managing Partner, Horgan Law LLC | Last updated: May 2026

Key Takeaways

• The market: Approximately 6 million U.S. small and medium-sized businesses will change ownership by 2035 (McKinsey, February 2026), representing up to $5 trillion in enterprise value. Baby boomers make up 59 percent of sellers (IBBA).
• The structure: Most Nebraska SMB deals are asset purchases (IRC § 1060, IRS Form 8594) or equity purchases (stock or LLC membership-interest sales). The choice carries different tax and liability consequences for buyer and seller.
• Nebraska law: The Nebraska Uniform Limited Liability Company Act (Neb. Rev. Stat. § 21-101 et seq.) governs LLC sales and mergers. The Nebraska Model Business Corporation Act (Neb. Rev. Stat. § 21-201 et seq.) governs corporate transactions, including appraisal rights confirmed in Streck, Inc. v. Ryan, 320 Neb. 638 (2026).
• The federal tax rules: IRC § 197 (15-year amortization of acquired goodwill), IRC §§ 338(h)(10) and 336(e) (asset-sale tax treatment for stock transactions), IRC § 1202 (QSBS exclusion, now $15M cap post-OBBBA), and IRC § 453 (installment sale treatment of seller notes) drive most M&A tax planning.
• The SBA rules: SBA Standard Operating Procedure 50 10 8 (effective June 1, 2025) tightened SBA 7(a) acquisition financing under 13 C.F.R. Part 120. Seller notes must be on full standby for the entire SBA loan term to count toward the buyer’s 10 percent equity injection.
• Antitrust: The 2026 Hart-Scott-Rodino size-of-transaction threshold is $133.9 million (effective February 17, 2026, 15 U.S.C. § 18a, 16 C.F.R. § 801 et seq.), well above the price of nearly every Nebraska SMB transaction.

A West Omaha contractor in his mid-sixties has spent thirty years building a $4 million revenue HVAC business. He has no children who want to take over, three key employees who could not afford to buy him out, and a buyer prospect from a private equity rollup that is offering a stock purchase at a multiple he does not understand. Three blocks away, an Elkhorn engineer who left a corporate job last year is trying to close on a sign manufacturing business with an SBA 7(a) loan, and his lender just told him the seller note he negotiated will not count toward his equity injection unless it is on full standby for ten years.

Both transactions are part of the largest wave of small business ownership transitions in American history. Both are governed by Nebraska entity statutes, the Internal Revenue Code, Treasury regulations, and federal lending rules that very few owners and buyers actually read before sitting down at the closing table. This guide explains what is happening in the Nebraska SMB M&A market in 2026, how state and federal law structure these deals, what the new SBA rules require, what protections sellers and buyers should negotiate, and where the avoidable mistakes show up.

What Is Happening in the Nebraska and U.S. SMB M&A Market in 2026?

Quick Answer: The U.S. small-business M&A market in 2026 is being driven by mass baby boomer retirement, with the McKinsey Institute for Economic Mobility projecting that approximately 6 million SMBs will face ownership transitions by 2035, representing up to $5 trillion in enterprise value. Buyer demand is strong, but pricing is bifurcated: prepared, profitable businesses command healthy multiples while founder-dependent or messy-books businesses struggle to attract bankable offers.

The supply side is demographics. Baby boomers own approximately 12 million U.S. businesses, and roughly 4.1 to 4.2 million Americans are turning 65 every year between 2024 and 2027. The International Business Brokers Association reports that boomers still make up 59 percent of sellers, and most are selling because they want to retire. SMBs make up 99 percent of all U.S. companies and employ roughly half of the U.S. workforce, which makes this transition a structural test of the economy, not merely a personal-finance issue for the owners involved.

The demand side is robust. BizBuySell’s 2025 data shows that 77 percent of buyers feel confident they can find a good deal, and Axial reported 3,320 new deals coming to market in a single recent quarter, the second-highest deal volume on record. Healthcare, business services, industrials, and technology are the most active sectors. Healthcare deal volumes were up approximately 75 percent year-on-year in Q1 2025; business services with tech-enabled components were up roughly 30 percent.

Pricing is bifurcated. Businesses with clean books, recurring revenue, margin discipline, and management depth still command healthy multiples. Founder-dependent businesses with deferred maintenance on their financial reporting are receiving heavy discounts or no offers at all. Earnouts tied to post-closing performance have become standard in sectors with forecasting risk, and seller financing has expanded to fill the gap left by tighter SBA underwriting. Approximately 60 percent of small business owners have no documented succession plan, and of those who do attempt to sell, only about 30 percent successfully close. The Nebraska businesses that prepare, and that retain competent counsel before the letter of intent is signed, are the ones that close.

Asset Sale or Equity Sale: Which Deal Structure Is Right Under the Internal Revenue Code?

Quick Answer: In an asset sale, the buyer purchases specified assets and assumes specified liabilities, takes a stepped-up tax basis in the acquired assets under IRC § 1060, and amortizes acquired goodwill over 15 years under IRC § 197. In an equity sale, the buyer purchases stock or LLC membership interests and takes the entity with all of its assets and liabilities. Buyers generally prefer asset deals for the tax basis step-up and liability isolation; sellers generally prefer equity deals for capital gains treatment and a cleaner walk-away.

Almost every SMB M&A transaction in Nebraska is structured as either an asset purchase or an equity purchase. For a corporation, an equity purchase is a stock sale. For an LLC, it is a membership-interest sale. The choice between asset and equity has serious tax, liability, and consent consequences, and the right answer is rarely the same for both sides.

The buyer’s case for an asset purchase

The buyer picks the assets it wants and the liabilities it is willing to assume, leaves the rest with the seller’s entity, and allocates the purchase price among the acquired assets under IRC § 1060 and Treasury Regulation § 1.1060-1 using the residual method. Both buyer and seller must file IRS Form 8594, Asset Acquisition Statement, with their federal income tax returns for the year of the sale. The buyer receives a stepped-up tax basis in tangible assets and amortizes acquired Section 197 intangibles, including goodwill, going-concern value, workforce in place, customer lists, and trade names, ratably over 15 years under IRC § 197 and Treasury Regulation § 1.197-2. That amortization is one of the most valuable tax attributes a buyer obtains in any SMB acquisition.

The seller’s case for an equity sale

The seller hands over the entity, all of its assets, and all of its liabilities (known and unknown) and walks away with consideration generally taxed at long-term capital gains rates under IRC § 1(h), plus the 3.8 percent net investment income tax under IRC § 1411 where applicable. C corporation sellers facing an asset sale at the entity level confront two layers of federal tax: corporate-level tax under IRC § 11 followed by shareholder-level tax on distribution. That double-tax problem is the single biggest reason C corporation owners want stock sales, not asset sales.

Hybrid elections: IRC §§ 338(h)(10) and 336(e)

Sophisticated transactions can resolve the asset-versus-stock tension using a joint election under IRC § 338(h)(10), governed by Treasury Regulation § 1.338(h)(10)-1, or a unilateral election under IRC § 336(e), governed by Treasury Regulation §§ 1.336-1 through 1.336-5. Both elections treat a stock sale as an asset sale for federal tax purposes, giving the buyer the basis step-up while preserving the cleaner consent profile of a stock sale. Eligibility is limited (generally to S corporation targets and corporate subsidiaries of consolidated groups), and the election must be made on a timely-filed return using IRS Form 8023 for Section 338(h)(10) elections.

Qualified Small Business Stock under IRC § 1202

Sellers of C corporation stock should evaluate the Qualified Small Business Stock exclusion under IRC § 1202 before signing an LOI. Under the One Big Beautiful Bill Act enacted July 4, 2025, the per-issuer exclusion cap was increased from $10 million to $15 million (indexed for inflation in tax years after 2026), and the aggregate gross asset threshold was increased from $50 million to $75 million for stock issued after July 4, 2025. The exclusion can eliminate up to 100 percent of federal capital gains tax on the sale of qualifying C corporation stock held for the required period, which is potentially the single most valuable tax benefit in the Internal Revenue Code for an exiting Nebraska business owner. The IRS has added Section 1202 regulations to its 2026 priority guidance list, so the planning landscape will continue to evolve.

The new SBA wrinkle

The Small Business Administration’s June 2025 SOP 50 10 8 has collapsed the asset-versus-stock analysis in one important respect. Partial change-of-ownership transactions must now be structured as stock or interest sales rather than asset sales. Sellers who used to roll a sliver of asset-sale equity into a NewCo to facilitate financing can no longer do so without converting the entire transaction to a stock or interest sale and personally guaranteeing the SBA loan for two years.

A note on tax structure. Tax structure is persuasive authority only at Horgan Law. The client’s CPA signs off on the final approach before the purchase agreement is signed. The federal tax citations in this guide are descriptive, not prescriptive, and every transaction requires a coordinated legal-and-tax analysis.

How Does Nebraska Law Govern Approval of a Small Business Sale?

Quick Answer: Nebraska LLC sales of all or substantially all assets require member consent under Neb. Rev. Stat. § 21-136, with the default consent threshold being unanimous unless the operating agreement provides otherwise. Nebraska corporate mergers require director adoption and shareholder approval under the Nebraska Model Business Corporation Act (Neb. Rev. Stat. § 21-2,166), and dissenting shareholders have appraisal rights under Neb. Rev. Stat. §§ 21-2,171 to 21-2,183 as recently expanded in Streck, Inc. v. Ryan, 320 Neb. 638 (2026).

Nebraska entity statutes set the framework for who must approve a sale, in what form, and what dissenters can do if they disagree. Owners and buyers who ignore the governing statute and the operating or shareholder agreement are the ones who end up litigating closing disputes in the District Court of Douglas County or the District Court of Sarpy County.

Nebraska LLC sales: Neb. Rev. Stat. § 21-101 et seq.

For Nebraska LLCs governed by the Nebraska Uniform Limited Liability Company Act, a sale, lease, exchange, or other disposition of all or substantially all of the company’s property outside the ordinary course of business requires the consent of the members. A merger, conversion, or domestication under Neb. Rev. Stat. §§ 21-170 to 21-184 likewise requires member consent. Neb. Rev. Stat. § 21-136 confirms that even in a manager-managed LLC, those extraordinary decisions are reserved to the members rather than to the managers. The default consent threshold under the act is unanimous unless the operating agreement provides otherwise, which is one of the reasons a well-drafted operating agreement is the most underrated piece of paper in any closely held Nebraska business.

Nebraska corporate sales and mergers: Neb. Rev. Stat. § 21-201 et seq.

For Nebraska corporations governed by the Nebraska Model Business Corporation Act, the directors must adopt the plan of merger or share exchange, the shareholders must approve it by the statutorily required vote, and the surviving entity must file articles of merger with the Nebraska Secretary of State pursuant to Neb. Rev. Stat. § 21-2,166. The articles of merger must recite either that the shareholders approved the transaction in the manner required by the act and the articles of incorporation, or that shareholder approval was not required.

Appraisal rights and Streck, Inc. v. Ryan

Dissenting shareholders have appraisal rights under Neb. Rev. Stat. §§ 21-2,171 to 21-2,183. These provisions allow a shareholder who disagrees with a merger, share exchange, or other corporate action triggering appraisal to demand fair value for their shares in cash. The Nebraska Supreme Court recently confirmed in Streck, Inc. v. Ryan, 320 Neb. 638 (2026), that the NMBCA expanded these rights compared to the prior Business Corporation Act, including by changing the terminology from “dissenter’s rights” to “appraisal rights” and by eliminating the requirement that a shareholder be entitled to vote on the action to have appraisal rights. The Streck court further held that articles of incorporation can grant appraisal rights to a class of shareholders, including nonvoting Class B shareholders, even where the statutory default would not extend appraisal to that class. Streck is the most important Nebraska M&A decision in years for closely held corporations with multiple share classes.

Organic documents always control where they exist

Operating agreements, shareholder agreements, buy-sell agreements, and voting agreements frequently impose drag-along rights, tag-along rights, rights of first refusal, and supermajority approval requirements that override the statutory defaults. The single most common mistake we see in Nebraska SMB transactions is a seller signing a letter of intent without first reading the operating agreement that governs the entity being sold.

How Did SBA SOP 50 10 8 Change Small Business Acquisitions in 2025 and 2026?

Quick Answer: Effective June 1, 2025, SBA Standard Operating Procedure 50 10 8 (issued under 13 C.F.R. Part 120) reinstated stricter underwriting for SBA 7(a) acquisition loans. Buyers must inject at least 10 percent of project cost; seller notes count for only half of that 10 percent and only if on full standby for the entire SBA loan term, typically 10 years. Sellers retaining any post-closing equity must personally guarantee the SBA loan for at least two years.

The SBA’s SOP 50 10 8, codified in regulation at 13 C.F.R. Part 120, materially tightened SBA 7(a) acquisition underwriting in response to a $397 million negative cash flow in the 7(a) program during fiscal year 2024. Buyers, sellers, and their counsel should treat the following as the new baseline for any Nebraska acquisition that contemplates SBA financing.

Equity injection and seller financing

The buyer must inject at least 10 percent of the project cost. A seller promissory note can count toward up to half of that 10 percent, meaning up to 5 percent of project cost, but only if the note is on full standby with no principal or interest payments for the entire SBA loan term, typically 10 years. This is a sharp tightening of the prior 24-month standby rule. Seller notes structured to provide actual cash flow to the seller can still be part of the financing stack, but they will not count toward equity injection and will be considered in the buyer’s debt service coverage ratio.

Ownership and personal guarantees

Every owner of an SBA borrower must now be a U.S. citizen, lawful permanent resident, or qualified U.S. national. Any seller who retains even one percent of post-closing equity must personally guarantee the SBA loan for at least two years. The 20 percent threshold that previously exempted minority investors from personal guarantees has been removed in partial-change transactions.

Loan structure and limits

Partial change-of-ownership transactions must now be structured as stock or interest sales, not asset sales. The maximum SBA 7(a) loan is $5 million. Collateral is now required on any SBA loan exceeding $50,000, versus the prior $500,000 threshold. Earnouts and contingent pricing are generally prohibited inside the 7(a)-financed transaction itself, although properly structured arrangements outside the acquisition can sometimes survive lender scrutiny.

Documentation flexibility

Lenders may now accept CPA-prepared or reviewed financial statements in lieu of tax returns in defined circumstances, which is a meaningful concession for sellers whose tax returns understate the true cash flow of the business.

Practical effect on Nebraska deals

Industry surveys show that 41 percent of brokers have reported transaction delays attributable to the new policies, and average time to close has lengthened by roughly 30 days. Deals that previously relied on creative seller-rollover structures are now pivoting to all-cash structures, conventional bank debt, mezzanine financing, search fund equity, and phantom equity arrangements that mimic rollover economics without triggering the SBA’s personal-guarantee rules.

What Federal Tax Code Sections Should Every Seller and Buyer Understand?

Quick Answer: Beyond IRC § 1060 (purchase price allocation), IRC § 197 (15-year amortization of intangibles), and IRC §§ 338(h)(10) and 336(e) (asset-sale elections), Nebraska SMB sellers and buyers should pay specific attention to IRC § 453 (installment method for seller notes), IRC § 1202 (QSBS exclusion), IRC § 1411 (3.8 percent net investment income tax), IRC § 7872 (imputed interest on below-market loans), and IRC § 409A (deferred compensation rules applicable to earnouts paid to former owner-employees).

IRC § 453: Installment sale treatment of seller notes

A seller who finances part of the purchase price with a promissory note can generally elect installment sale treatment under IRC § 453, recognizing gain pro rata as principal payments are received rather than all at once at closing. The installment method does not apply to dealer dispositions, inventory, recapture income under IRC §§ 1245 and 1250, or publicly traded property. Sellers planning a meaningful tax deferral should run the numbers with their CPA before negotiating the note terms.

IRC § 1411: Net investment income tax

The 3.8 percent net investment income tax under IRC § 1411 applies to the capital gain portion of most SMB sales for higher-income sellers, and it is frequently overlooked in pre-sale tax projections. A $3 million capital gain on a sale of stock generates approximately $114,000 in NIIT in addition to the federal capital gains tax.

IRC § 7872: Imputed interest on below-market loans

Seller notes bearing interest below the applicable federal rate (AFR) published monthly by the IRS can trigger imputed interest under IRC § 7872. Sellers offering “interest-free” financing as a deal sweetener are frequently surprised to learn that the IRS will recharacterize a portion of principal payments as interest income.

IRC § 409A: Earnouts and deferred compensation

Earnouts paid to a seller who continues to work for the buyer post-closing can be recharacterized as compensation rather than purchase price, particularly where the earnout is tied to the seller’s continued employment. IRC § 409A and its implementing regulations impose strict timing rules on deferred compensation, with a 20 percent additional tax on noncompliant arrangements. Earnout structures should be reviewed by tax counsel before signing.

What Other Federal Regulations and Statutes Apply to SMB M&A?

Quick Answer: Beyond the Internal Revenue Code, key federal authorities include the Hart-Scott-Rodino Antitrust Improvements Act (15 U.S.C. § 18a, with the 2026 size-of-transaction threshold at $133.9 million effective February 17, 2026), the WARN Act (29 U.S.C. §§ 2101-2109) for layoffs of 50 or more workers, and ERISA for benefit plan transfers. Most Nebraska SMB deals fall below the HSR threshold but still implicate WARN, ERISA, and securities-law considerations.

Antitrust: Hart-Scott-Rodino and the 2026 threshold

The Hart-Scott-Rodino Antitrust Improvements Act of 1976, codified at 15 U.S.C. § 18a (Section 7A of the Clayton Act) and implemented by regulations at 16 C.F.R. Parts 801 through 803, requires pre-merger notification to the Federal Trade Commission and the Department of Justice Antitrust Division for transactions exceeding the size-of-transaction threshold, with a mandatory waiting period before closing. The 2026 size-of-transaction threshold is $133.9 million effective February 17, 2026, up from $126.4 million in 2025. Nearly every Nebraska SMB transaction falls well below this threshold, which means HSR is rarely a closing condition for deals below $100 million, but counsel should confirm thresholds and exemptions on every transaction.

Workforce: WARN Act

The Worker Adjustment and Retraining Notification Act, codified at 29 U.S.C. §§ 2101 through 2109 and implemented at 20 C.F.R. Part 639, requires 60 days’ advance notice of plant closings and mass layoffs by employers with 100 or more employees. Asset purchasers should confirm whether the seller’s workforce reductions in advance of closing trigger WARN obligations, and stock purchasers should confirm that no WARN exposure transfers with the entity.

Benefits and ERISA

The Employee Retirement Income Security Act of 1974, codified at 29 U.S.C. § 1001 et seq., governs the transfer or termination of qualified retirement plans, health and welfare plans, and other employee benefit arrangements. Asset purchasers generally do not assume the seller’s plans; stock and membership-interest purchasers generally do. Either way, ERISA coordination is non-negotiable in any Nebraska SMB acquisition with a 401(k), pension, or self-funded health plan.

Securities regulation

The issuance of buyer stock or noncash consideration to selling shareholders implicates the Securities Act of 1933 and the Securities Exchange Act of 1934. Most SMB deals rely on the private placement exemption under Section 4(a)(2) and Regulation D, 17 C.F.R. § 230.500 et seq., but the exemption must be perfected through the proper notice filing on Form D within 15 days of the first sale. Nebraska blue-sky compliance under the Nebraska Securities Act, Neb. Rev. Stat. § 8-1101 et seq., is a separate analysis.

What Protections Should Sellers and Buyers Negotiate in the Purchase Agreement?

Quick Answer: Five contractual provisions deserve specific attention in every Nebraska SMB deal: representations and warranties (with knowledge and materiality qualifiers), indemnification (with caps, baskets, and survival periods), escrow and working capital adjustments, restrictive covenants (non-compete, non-solicit, NDA), and third-party consents. Each is a place where significant value is created or destroyed in negotiation.

Representations and warranties. The buyer wants broad, deep representations covering financial statements, taxes, intellectual property, employees, contracts, customers, regulatory compliance, environmental matters, undisclosed liabilities, and litigation. The seller wants those representations qualified by knowledge, by materiality, and by disclosure schedules. The fight over knowledge qualifiers, meaning who has “knowledge” and what knowledge is imputed to them, is rarely worth less than six figures over the long run.

Indemnification. The threshold issue is who indemnifies whom, for what, and up to what cap. Caps, baskets, deductibles, and survival periods should be calibrated to the transaction, not pulled from a form file. Fundamental representations covering authority, ownership, and capitalization should survive indefinitely or at least through the applicable statute of limitations. Operational representations typically survive 12 to 24 months. Tax representations survive through the applicable assessment period under IRC § 6501.

Escrow and holdbacks. A buyer-side escrow of 5 to 15 percent of the purchase price for 12 to 24 months gives the buyer a recourse fund without forcing it to sue the seller. A working capital adjustment, with a true-up at closing, prevents the seller from stripping cash and inflating accounts receivable in the weeks before closing.

Restrictive covenants. Non-competition, non-solicitation, and non-disclosure covenants are enforceable in Nebraska if reasonable in scope, geography, and duration, but Nebraska courts will not blue-pencil overbroad restrictions. The restrictions must be drafted precisely against the actual business being sold. Generic five-year, fifty-state non-competes are common mistakes that are also common reasons enforcement fails.

Third-party consents. Almost every SMB has a handful of contracts (landlord, key customer, key supplier, licensor, lender) that prohibit assignment without consent. The purchase agreement should identify required consents on a schedule, allocate the burden of obtaining them, and condition closing on the material consents being delivered. Successor liability under Nebraska common law, including the de facto merger and continuity-of-enterprise doctrines, is the silent killer in asset deals that fail to address consents and known liabilities at closing.

What Are the Most Common Deal-Killers in Nebraska SMB M&A?

Quick Answer: The five most common deal-killers in Nebraska SMB transactions are unclean financial statements that fail quality-of-earnings analysis, undisclosed customer or employee concentration risk, surprise environmental or licensing issues, a co-owner or spouse who refuses to consent at the last minute, and SBA financing falling out under the new SOP 50 10 8 rules.
In the firm’s experience handling transactions for Omaha, Elkhorn, Lincoln, Bellevue, and Papillion business owners, the transactions that fall apart generally do so for one of five reasons:

• Books that do not survive quality-of-earnings. Add-backs that cannot be substantiated, owner compensation that cannot be normalized, and missing GAAP adjustments.
• Customer or employee concentration risk. Discovered in diligence and not addressed through retention bonuses, key-customer reps, or purchase price adjustments.
• Late-stage environmental, licensing, or regulatory surprises. Surface too late to be priced into the deal.
• Missing co-owner or spousal consent. The seller’s spouse or co-owner refuses to sign at the last minute because no one negotiated consent in advance and the operating or shareholder agreement requires it.
• SBA financing falling out. Under SOP 50 10 8, the buyer cannot get to the 10 percent equity injection, the seller note structure fails standby rules, or rollover equity triggers personal guarantee requirements that one party will not accept.

All five are avoidable with disciplined deal preparation and counsel who reads the operating agreement, the customer contracts, the existing loan documents, and the lease before the LOI is signed.

Frequently Asked Questions: Nebraska SMB M&A

Do I need a Nebraska attorney to sell my Omaha business?

You are not legally required to use Nebraska counsel for a Nebraska transaction, but the deal will be governed substantially by Nebraska entity law, real estate law, employment law, and state tax law. Out-of-state counsel can often handle a Nebraska deal competently. Horgan Law LLC regularly serves as local Nebraska counsel for out-of-state attorneys on exactly these transactions.

How long does a typical Nebraska SMB M&A transaction take?

A straightforward deal with a prepared seller, a financed buyer, and clean books typically closes in 90 to 120 days from signed LOI. The SBA SOP 50 10 8 changes have added roughly 30 days to the average timeline. Deals with significant diligence issues, third-party consents, regulatory approvals, or real estate components can take six months or more.

What is the typical purchase price multiple for a Nebraska SMB?

Pricing varies by industry, recurring revenue mix, and management depth. Service businesses typically transact at 2.5x to 4x seller’s discretionary earnings. Tech-enabled and recurring-revenue businesses can transact at 4x to 7x EBITDA or higher. Founder-dependent businesses without a management team trade at the lower end of those ranges and frequently fail to attract bankable offers at all.

Should I sign a letter of intent before getting an attorney involved?

No. The letter of intent sets the structural framework for the entire transaction, often including exclusivity, deal structure, price mechanics, escrow expectations, and key economic terms that become very difficult to renegotiate later. Horgan Law reviews LOIs before signature, not after.

What happens if a minority owner refuses to consent to a sale?

The answer depends on the entity’s organic documents and the applicable statute. For a Nebraska LLC, the operating agreement controls, and absent agreement, the consent thresholds in the Nebraska Uniform Limited Liability Company Act apply. For a Nebraska corporation, the NMBCA shareholder voting rules govern, and a dissenting shareholder may have appraisal rights under Neb. Rev. Stat. §§ 21-2,171 to 21-2,183, as recently confirmed and expanded by Streck, Inc. v. Ryan, 320 Neb. 638 (2026).

Can I exclude my entire gain from federal tax under IRC § 1202?

Possibly. IRC § 1202 allows certain sellers of qualified small business stock to exclude up to 100 percent of federal capital gains tax, capped at $15 million per issuer for stock acquired after July 4, 2025 (or $10 million for stock acquired on or before that date). The corporation must be a domestic C corporation with aggregate gross assets at or below $75 million (post-OBBBA) at the time of stock issuance, the stock generally must be held for five years, and the corporation must satisfy active business requirements. Pre-sale planning is essential because the exclusion does not apply retroactively to non-qualifying stock.

Will my seller note count toward the buyer’s SBA equity injection?

Only if the note is on full standby (no principal or interest payments) for the entire SBA loan term, typically 10 years, and only up to 50 percent of the required 10 percent equity injection. A seller note that pays current interest, or that has a shorter standby period, can still be part of the financing stack but will not count toward equity injection under SOP 50 10 8.

Do I need an HSR filing for my Nebraska business sale?

Almost certainly not. The 2026 Hart-Scott-Rodino size-of-transaction threshold is $133.9 million, effective February 17, 2026. Virtually every Nebraska SMB transaction is below that threshold. Counsel should confirm thresholds and exemptions on every transaction, but HSR is rarely a closing condition for deals below approximately $100 million.

How are earnouts taxed?

Earnouts are typically treated as deferred purchase price taxable at capital gains rates if structured as additional consideration to the selling shareholders. However, the IRS will recharacterize earnouts as ordinary compensation income (subject to payroll tax) where the earnout is tied to continued employment of the seller. IRC § 409A imposes strict timing rules on deferred compensation arrangements. Earnout structures should be drafted with both tax counsel and corporate counsel before signing.

What is the difference between an asset purchase and a stock purchase under Nebraska law?

In an asset purchase, the buyer purchases specified assets (equipment, inventory, intellectual property, customer relationships) and assumes only specified liabilities, with the seller’s entity retaining the rest. In a stock or LLC membership-interest purchase, the buyer acquires the equity of the entity itself and steps into all of its assets and liabilities (known and unknown). Asset deals generally favor buyers (tax basis step-up under IRC § 1060 and IRC § 197, liability isolation); equity deals generally favor sellers (capital gains treatment, cleaner walk-away, easier handling of non-assignable contracts).

Working With Horgan Law on a Nebraska SMB M&A Transaction

If you are considering selling a Nebraska business, evaluating an acquisition, structuring an SBA-financed deal under the new SOP 50 10 8 rules, planning around IRC § 1202 or IRC §§ 338(h)(10) and 336(e) elections, or working through a partial buyout or succession plan, Horgan Law LLC can help. The firm handles transactions for owners, buyers, private equity sponsors, family offices, and search funds across Omaha, Elkhorn, Lincoln, Bellevue, Papillion, Gretna, and the surrounding region. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to schedule a consultation.

About the Author

Tom Horgan is the Managing Partner and founder of Horgan Law LLC in Omaha, Nebraska. His practice spans commercial litigation, corporate and M&A, contracts, real estate, estate planning, and insurance defense. He represents Nebraska business owners, buyers, and investors in middle-market transactions across the state. Horgan Law LLC is a Super Lawyers-recognized firm serving Omaha, Elkhorn, Lincoln, Bellevue, Papillion, Gretna, and the broader Midwest.

Key Authorities Cited

Nebraska Statutory Authorities

• Neb. Rev. Stat. § 21-101 et seq. (Nebraska Uniform Limited Liability Company Act)
• Neb. Rev. Stat. § 21-136 (manager-managed LLC; member consent for extraordinary transactions)
• Neb. Rev. Stat. §§ 21-170 to 21-184 (LLC merger, conversion, and domestication)
• Neb. Rev. Stat. § 21-201 et seq. (Nebraska Model Business Corporation Act)
• Neb. Rev. Stat. § 21-2,166 (articles of merger or share exchange)
• Neb. Rev. Stat. §§ 21-2,171 to 21-2,183 (appraisal rights)
• Neb. Rev. Stat. § 8-1101 et seq. (Nebraska Securities Act)

Nebraska Case Authority

• Streck, Inc. v. Ryan, 320 Neb. 638 (2026) (NMBCA appraisal rights; Class B nonvoting shareholders)

Internal Revenue Code Provisions

• IRC § 1(h) (long-term capital gains rates)
• IRC § 11 (corporate income tax)
• IRC § 197 (15-year amortization of acquired intangibles, including goodwill)
• IRC § 338(h)(10) (joint election to treat stock sale as asset sale)
• IRC § 336(e) (unilateral election to treat stock sale as asset sale)
• IRC § 368(a) (tax-free reorganizations)
• IRC § 409A (deferred compensation; earnouts)
• IRC § 453 (installment method for seller financing)
• IRC § 1060 (allocation of purchase price in asset acquisitions)
• IRC § 1202 (Qualified Small Business Stock exclusion; OBBBA amendments effective July 5, 2025)
• IRC § 1411 (3.8% net investment income tax)
• IRC § 6501 (statute of limitations on tax assessments)
• IRC § 7872 (imputed interest on below-market loans)
• IRC §§ 1245 and 1250 (depreciation recapture)

Treasury Regulations

• Treas. Reg. § 1.197-2 (amortization of Section 197 intangibles)
• Treas. Reg. § 1.338(h)(10)-1 (Section 338(h)(10) election procedures)
• Treas. Reg. §§ 1.336-1 through 1.336-5 (Section 336(e) election procedures)
• Treas. Reg. § 1.1060-1 (allocation of consideration in asset acquisitions)

IRS Forms

• IRS Form 8023 (Section 338(h)(10) election)
• IRS Form 8594 (Asset Acquisition Statement Under Section 1060)

Federal Statutes and Regulations

• 15 U.S.C. § 18a (Hart-Scott-Rodino / Clayton Act § 7A)
• 16 C.F.R. Parts 801-803 (HSR implementing regulations)
• 17 C.F.R. § 230.500 et seq. (Regulation D private placement exemption)
• 20 C.F.R. Part 639 (WARN Act regulations)
• 13 C.F.R. Part 120 (SBA 7(a) Loan Program)
• 13 C.F.R. Part 121 (SBA small business size standards)
• 29 U.S.C. §§ 1001 et seq. (ERISA)
• 29 U.S.C. §§ 2101-2109 (WARN Act)
• Securities Act of 1933, 15 U.S.C. § 77a et seq.
• Securities Exchange Act of 1934, 15 U.S.C. § 78a et seq.
• SBA Standard Operating Procedure 50 10 8 (effective June 1, 2025)

Legislative Authority

• One Big Beautiful Bill Act, Pub. L. No. 119-XX (enacted July 4, 2025) (amending IRC § 1202)

Market Data Sources

• McKinsey Institute for Economic Mobility, “The Great Ownership Transfer: A New Era of Business Stewardship” (February 2026)
• International Business Brokers Association (IBBA), 2025 Market Pulse Report
• BizBuySell, 2025 Insight Report
• Axial, 2025 Quarterly Deal Volume Data
• Federal Trade Commission, 2026 HSR Threshold Announcement (January 14, 2026)

Your firm just landed a seven-figure commercial dispute, but the case is filed in Douglas County District Court in Omaha. Your lead partner is barred in Illinois and New York. She’s handled dozens of cases like this — but she’s never set foot in a Nebraska courtroom. She needs local counsel, and she needs to understand exactly what that means in Nebraska before she files anything.

If the same firm has a related matter across the river in Pottawattamie County, Iowa, the local counsel requirements are different — and in some ways, significantly more demanding. Iowa doesn’t treat local counsel as a courtesy filing. The Iowa Supreme Court treats it as a co-counsel relationship with real obligations that can’t be delegated.

This guide covers the specific rules governing pro hac vice admission and local counsel in both Nebraska and Iowa state courts, the federal district courts for both states, the caselaw that defines local counsel’s duties and liabilities, and the practical considerations that out-of-state attorneys and their clients should understand before retaining local counsel in the Omaha–Council Bluffs metro area.

Horgan Law LLC serves as local counsel for out-of-state law firms litigating in Nebraska and Iowa. Tom Horgan is licensed in Nebraska, Iowa, and New York, and the firm regularly partners with national firms on matters in Douglas County, Sarpy County, and across the Nebraska–Iowa corridor.

What Are the Pro Hac Vice Requirements in Nebraska State Courts?

Nebraska’s pro hac vice rules are governed by Neb. Ct. R. § 3-122, most recently amended in February 2025. The rule provides that any attorney admitted to practice in another state may, in the court’s discretion, be admitted to appear in a Nebraska proceeding for the purpose of handling that specific matter.

The critical requirement for out-of-state attorneys is this: Nebraska mandates that an attorney licensed in Nebraska serve as associated counsel. Under § 3-122, the Nebraska- licensed attorney must file the motion for pro hac vice admission with the court, and that motion must be filed no later than the date the out-of-state attorney files any pleading or appears personally.

The associated Nebraska counsel must sign the motion for admission, all pleadings, motions, and papers filed in the case — and must personally appear at all proceedings before the court unless excused by the court. This is not a passive role. Nebraska expects local counsel to be present and accountable.

The fee is $250 per case, payable to the clerk of the court. For consolidated cases, one fee covers all cases consolidated by court order, but cases later consolidated do not get a refund. Once admitted, the out-of-state attorney must take the oath required of Nebraska attorneys under Neb. Rev. Stat. § 7-104, and the subscribed oath is filed with the clerk and made part of the court record.

There is a reciprocity carve-out. Nebraska sets up a system of reciprocity under § 3-121: if another state allows a Nebraska attorney to practice without associating local counsel, Nebraska extends the same courtesy to attorneys from that state. However, the number of states that qualify for full reciprocity is limited, and most out-of-state attorneys will need Nebraska-licensed associated counsel.

One practical point that catches many out-of-state firms off guard: Nebraska’s e-filing system is only available to attorneys licensed in Nebraska. An attorney admitted pro hac vice must file through their associated Nebraska counsel. This alone makes the local counsel relationship essential for day-to-day case management.

How Does Iowa’s Local Counsel Requirement Differ from Nebraska’s?

Iowa’s pro hac vice rules, governed by Iowa Ct. R. 31.14, impose a materially higher standard on local counsel than Nebraska does. In Iowa, the term “local counsel” carries obligations that go well beyond signing pleadings and showing up for hearings.

Under Rule 31.14(3), the in-state Iowa lawyer must “actively participate” in the matter as counsel of record or co-counsel with the out-of-state lawyer. The Iowa Supreme Court has interpreted this to mean that the Iowa lawyer sets the operational parameters of the representation and only allows the out-of-state lawyer to operate independently in limited situations. The Iowa lawyer who sponsors a pro hac vice admission “remains responsible to the client and responsible for the conduct of the proceeding before the court or agency.”

This is a fundamentally different model than what most national firms expect. In Nebraska, local counsel’s role can be more narrowly defined by agreement between the firms. In Iowa, the ethics rules prevent the in-state lawyer from limiting the scope of representation to the client under Iowa R. of Prof’l Conduct 32:1.2(c) when serving as local counsel. The Iowa lawyer has collaboration, consultation, and advisory responsibilities that cannot be delegated to the pro hac vice lawyer.

The Iowa Supreme Court Ethics Committee has opined that the local counsel relationship in Iowa functions as a co-counsel arrangement, not a “mailbox” service. Iowa local counsel must engage in strategic planning dialogue under Iowa R. of Prof’l Conduct 32:1.4(a)(2) and has an independent obligation to educate the client under 32:1.4(b).

These duties exist regardless of any agreement between the Iowa lawyer and the out-of- state firm to divide responsibilities differently.

Iowa also requires a $250 registration fee through the Office of Professional Regulation, which allows the out-of-state attorney to apply for pro hac vice admission for a period of up to five years. The application must be served on all parties who have appeared in the proceeding, with proof of service. Upon admission, the out-of-state lawyer submits to the disciplinary authority of Iowa courts for all conduct relating to the proceeding.

What Are the Requirements in the Federal District Courts?

The United States District Court for the District of Nebraska, under NEGenR 1.7, allows any attorney admitted to practice before the highest court of any state to apply for pro hac vice admission for a particular case. The federal court’s local rules generally require association of local counsel, and the practical reality is the same as in state court: local counsel handles e-filing, ensures compliance with local rules, and appears when the out- of-state attorney cannot.

The United States District Court for the Southern District of Iowa is explicit: in civil cases, attorneys admitted pro hac vice must have local counsel. The Southern District requires a $100 fee for pro hac vice admission in civil cases, and the local counsel requirement is mandatory rather than discretionary.

In both federal districts, local counsel plays a critical role in ensuring compliance with the district’s specific local rules — which differ between the District of Nebraska and the Southern and Northern Districts of Iowa in areas including discovery procedures, motion practice, and pretrial scheduling.

What Are the Legal Risks of the Local Counsel Relationship?

The leading case on local counsel liability is Macawber Engineering, Inc. v. Robson & Miller, 47 F.3d 253 (8th Cir. 1995). In Macawber, a client retained a New York law firm as lead counsel and a Minnesota firm as local counsel for a federal commercial dispute. Lead counsel failed to respond to 130 requests for admissions, resulting in deemed admissions and a $650,000 judgment. The client then sued both the New York firm and local counsel for malpractice.

The Eighth Circuit affirmed summary judgment in favor of local counsel. The court found that the scope of the attorney-client relationship between the client and local counsel was limited. The retention letter confirmed local counsel’s role as supporting lead counsel, the client’s CEO testified he relied on lead counsel to direct local counsel’s activities, and local counsel was never served with the discovery requests at issue. The court held that the limited engagement did not encompass a duty to independently monitor the discovery process.

Macawber is frequently cited as establishing that local counsel’s duties are defined by the scope of the engagement — not by some inherent obligation to oversee lead counsel’s work. However, this holding should be understood in context. The Eighth Circuit’s analysis turned on the specific facts: local counsel was never served with the discovery requests, billed fewer than ten hours to the entire matter, and no one asked or expected local counsel to do more.

The trend in other circuits is moving away from the Macawber approach. As one federal court noted in Ingemi v. Pelino & Lentz, 866 F. Supp. 156 (D.N.J. 1994), the Federal Rules of Civil Procedure do not recognize attorneys with “limited responsibilities” as less than full advocates for their clients. And in Curb Records, Inc. v. Adams & Reese, LLP, the Fifth Circuit held that local counsel has “an inherent and nondelegable duty to report directly to its client any known instances of malfeasance and misfeasance on the part of lead counsel that an objectively reasonable lawyer in the locality would conclude are seriously prejudicial to the client’s interests.”

For Iowa local counsel, the risk profile is higher by design. Because Iowa’s rules impose active participation and responsibility for the conduct of the proceeding, an Iowa local counsel who takes a completely passive role may be violating the ethical rules regardless of what the engagement letter says. This is a meaningful distinction from Nebraska, where the rules permit a somewhat more limited role.

What Happens If You Practice in Nebraska or Iowa Without Local Counsel?

Practicing law in Nebraska without proper admission constitutes the unauthorized practice of law. The Nebraska Supreme Court exercises jurisdiction over all matters involving the licensing of attorneys under Neb. Ct. R. § 3-101. The Commission on Unauthorized Practice of Law, operating under Neb. Ct. R. Chapter 3, Article 10, investigates complaints and can refer matters for prosecution.

The consequences are severe. In State ex rel. Counsel for Discipline v. Jorgenson, 304 Neb. 625 (2019), the Nebraska Supreme Court addressed an attorney who continued practicing after an administrative suspension, including using a law firm signature block on communications. The court considered this among multiple violations warranting significant discipline. In State ex rel. Counsel for Discipline v. Schild, 307 Neb. 89 (2020), the court imposed reciprocal discipline for unauthorized practice violations that originated in another state, demonstrating that Nebraska will enforce UPL rules even when the primary violation occurred elsewhere.

Iowa takes an equally serious approach. Under Iowa R. of Prof’l Conduct 32:5.5, a lawyer who is not admitted to the Iowa bar and who practices law in Iowa without complying with the pro hac vice requirements is engaged in the unauthorized practice of law.

Because Iowa’s local counsel rules impose active participation obligations, an out-of-state lawyer who appears in Iowa proceedings without a properly engaged Iowa co-counsel is exposed to disciplinary action in both Iowa and their home state.

What Should Out-of-State Attorneys Look for in Nebraska or Iowa Local Counsel?

Not all local counsel relationships are the same. The value of local counsel depends on what they bring beyond a bar number and a signature. Here’s what matters in the Nebraska–Iowa corridor:

Courtroom-Specific Knowledge

Douglas County District Court, Sarpy County District Court, Lancaster County District Court, and the Pottawattamie County Courthouse in Council Bluffs each have their own procedural expectations, scheduling practices, and judicial preferences. An attorney who practices regularly in these courts understands the practical dynamics that don’t appear in the local rules — how particular judges manage their dockets, what motion practice looks like in practice versus on paper, and what arguments resonate.

Substantive Capacity

The best local counsel relationships are with firms that can contribute substantively to the litigation — not just file pleadings. If your case involves Nebraska contract law, Nebraska insurance coverage questions, Iowa employment statutes, or any state-specific substantive issue, local counsel who practices in that area adds value beyond procedural compliance.

Multi-Jurisdictional Coverage

For matters in the Omaha–Council Bluffs metro, the case may involve parties, claims, or related proceedings in both Nebraska and Iowa. Having local counsel licensed in both states eliminates the need for two separate firms and ensures consistent strategy across jurisdictions.

Responsiveness

Emergency motions, temporary restraining orders, and urgent filings don’t wait for time zone differences. Local counsel who is physically present in the Omaha metro area and available on short notice provides a practical advantage that remote arrangements cannot replicate.

Frequently Asked Questions

Do I need local counsel for every case in Nebraska?

In most cases, yes. Nebraska Ct. R. § 3-122 requires associated Nebraska counsel for pro hac vice admission unless your home state qualifies under the reciprocity provision of § 3-121. Even if reciprocity applies, local counsel is practically necessary because Nebraska’s e-filing system is only available to Nebraska-licensed attorneys, and familiarity with local court procedures provides a significant strategic advantage.

Is Iowa local counsel more involved than Nebraska local counsel?

Yes. Iowa Ct. R. 31.14(3) requires the Iowa lawyer to actively participate in the matter and remain responsible for the conduct of the proceeding. The Iowa Supreme Court Ethics Committee has interpreted this as a co-counsel relationship with substantive obligations that cannot be delegated. Nebraska’s rules allow a somewhat more limited role for associated counsel, though Nebraska local counsel is still required to sign all filings and appear at all proceedings unless excused.

Can local counsel be held liable for lead counsel’s mistakes?

It depends on the scope of the engagement and the jurisdiction. Under Macawber Engineering, Inc. v. Robson & Miller, 47 F.3d 253 (8th Cir. 1995), local counsel’s duties are defined by the scope of the retention, and a limited engagement does not create an inherent duty to monitor lead counsel’s work. However, the trend in other jurisdictions is toward broader local counsel liability, particularly when local counsel was aware of problems and failed to act. In Iowa, the active participation requirement makes passive local counsel riskier from both an ethics and liability perspective.

How much does local counsel cost in Nebraska and Iowa?

The court filing fee for pro hac vice admission is $250 in both Nebraska state courts and Iowa. Federal court fees are $100 in the Southern District of Iowa. Local counsel’s professional fees vary based on the scope of the engagement — a limited filing-and- appearance role costs less than substantive co-counsel participation. Discuss the expected scope of work upfront to align expectations on both sides.

Is Horgan Law licensed in both Nebraska and Iowa?

Yes. Tom Horgan is admitted to the bar in Nebraska, Iowa, and New York. Horgan Law LLC regularly serves as local counsel for national and regional firms litigating in Douglas County, Sarpy County, and across the Nebraska–Iowa metro area, including matters in the U.S. District Court for the District of Nebraska and the Southern District of Iowa.

If your firm needs local counsel in Nebraska or Iowa — whether for a single hearing or a multi-year litigation — Horgan Law LLC can help. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to discuss how we can support your matter.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

A Nebraska football player signs an NIL deal with the university’s multimedia rights partner. The College Sports Commission rejects it. The player files for arbitration.

Meanwhile, a state senator introduces a bill that would prevent any collegiate athletic association from forcing disclosure of NIL contract terms. And the university is simultaneously writing revenue-sharing checks to athletes for the first time in its history.

That is not a hypothetical. That is Nebraska in March 2026.

The landscape for Name, Image, and Likeness in Nebraska has changed more in the past nine months than it did in the four years since the Nebraska Fair Pay to Play Act first took effect in 2021. The House v. NCAA settlement — approved on June 6, 2025 — introduced direct institutional revenue sharing, a new enforcement body, third-party deal scrutiny, roster limits, and $2.8 billion in back damages. It also created a collision between federal settlement terms and state NIL statutes that is now playing out in real time, with Nebraska at the center of the fight.

This guide explains where NIL law stands in Nebraska right now, what the House settlement changed, what the new enforcement regime means for athletes and businesses, and what legal issues Nebraska athletes, families, collectives, and sponsors need to understand going forward.

Horgan Law LLC is a licensed athlete agent and NIL law firm in Omaha, Nebraska. We represent college and high school athletes, NIL collectives, and businesses engaged in athlete endorsement deals throughout the state.

What Did the House v. NCAA Settlement Change?

The House settlement resolved three consolidated federal antitrust lawsuits — House v. NCAA, Hubbard v. NCAA, and Carter v. NCAA — and fundamentally restructured the economic relationship between colleges and their athletes. The settlement was approved by Judge Claudia Wilken on June 6, 2025, and the injunctive relief provisions took effect on July 1, 2025.

The settlement has three core components that every Nebraska athlete and business needs to understand.

Revenue Sharing

For the first time in the history of college athletics, NCAA member institutions are permitted to pay athletes directly. The settlement allows schools to distribute up to 22% of the average revenue generated by Power Five conference schools from media rights, ticket sales, and sponsorships. For the 2025-2026 academic year, that cap is approximately $20.5 million per school, and it increases by at least 4% annually over the 10-year settlement term. Every school in the Big Ten — including the University of Nebraska — has committed to fully funding revenue sharing at the $20.5 million level. The allocation is left to each school’s discretion, but most are directing roughly 75% to football, 15% to men’s basketball, 5% to women’s basketball, and 5% to all other sports combined.

Back Damages

The NCAA and its member institutions will pay approximately $2.8 billion over 10 years to athletes who competed in Division I from 2016 through June 6, 2025. More than 95% of those damages are expected to go to football and men’s and women’s basketball athletes who played at Power Five schools. These payments are currently on hold pending seven separate appeals filed by different groups of athletes challenging various aspects of the settlement.

Roster Limits and Scholarship Changes

The settlement replaced the traditional headcount scholarship model with new sport-specific roster limits. Schools that opt into revenue sharing must comply with these limits. The settlement also allows schools to offer full scholarships to every athlete on a team’s roster — eliminating the old distinction between headcount and equivalency sports. Schools had until the start of each sport’s competitive season to reach compliance with the new limits, with grandfathering provisions for current athletes.

What Is the College Sports Commission and How Does It Affect Nebraska Athletes?

The College Sports Commission (CSC) is the new independent enforcement body created by the Power Five conferences to implement and police the House settlement. The CSC is separate from the NCAA and is led by CEO Bryan Seeley, a former MLB executive. The CSC’s responsibilities include enforcing revenue-sharing rules, monitoring roster limits, and — most critically for Nebraska athletes and businesses — reviewing and approving third-party NIL deals.

Under the settlement, every third-party NIL deal exceeding $600 must be submitted to the CSC for approval through a platform called NIL Go, which launched on June 11, 2025. The CSC uses data from Deloitte and LBI — firms that handle revenue management for professional sports leagues — to evaluate whether a deal reflects the athlete’s fair market value. Deals that exceed fair market value may be flagged as disguised pay-for-play arrangements and rejected.

The compliance numbers suggest significant gaps in enforcement. As of January 1, 2026, the CSC reported only $127 million in cleared deals — a fraction of the estimated $500 million third-party NIL market in basketball alone. Industry analysts attribute part of this gap to a “money dump” by NIL collectives before July 1, 2025, when many collectives fully distributed their funds to avoid CSC scrutiny. But the gap also suggests that substantial NIL activity is occurring outside the reporting framework.

Why Is Nebraska at the Center of the NIL Enforcement Fight?

Nebraska has become the first major test case for the CSC’s enforcement authority. In early 2026, the CSC rejected NIL deals involving Nebraska football players and Playfly, the university’s multimedia rights partner. The CSC determined that the deals lacked sufficient information about what was specifically expected of the athletes in exchange for payment — raising concerns that the compensation looked more like pay-for-play than legitimate NIL endorsements.

The Nebraska players exercised their right under the House settlement to challenge the CSC’s rejection through arbitration. That arbitration proceeding is ongoing, with a decision expected within 45 days of the hearing.

What makes this case nationally significant is the collision between the CSC’s authority and Nebraska state law. The Nebraska Student-Athlete Name, Image, or Likeness Rights Act (Neb. Rev. Stat. §§ 48-3601 to 48-3609, as amended by LB 1137) explicitly prohibits any “collegiate athletic association” from penalizing a student-athlete for earning compensation from NIL activities. If the CSC’s rejection of the Playfly deals is upheld in arbitration, the players or the Nebraska Attorney General could potentially seek a state court injunction under Nebraska law — arguing that the CSC’s action violates the state statute.

Simultaneously, Nebraska State Senator Megan Hunt introduced LB 370, which would prohibit any collegiate athletic association from requiring athletes, schools, agents, or NIL collectives to disclose NIL contract details to the NCAA or any affiliated entity. This bill is a direct challenge to the CSC’s NIL Go reporting requirement and reflects a broader trend of states asserting authority over NIL regulation against federal settlement terms.

Nebraska is not alone in this fight — Oregon, Georgia, Virginia, and Tennessee have all taken steps to challenge NCAA authority over NIL — but Nebraska’s combination of strong state statutory protections and an active test case makes it the jurisdiction to watch in 2026.

What Does Nebraska’s NIL Law Actually Say?

Nebraska’s NIL statute, the Nebraska Student-Athlete Name, Image, or Likeness Rights Act (originally the Nebraska Fair Pay to Play Act), was signed into law on July 24, 2020, and has been amended since. The current version, as amended by LB 1137, includes the following key provisions:

Nebraska college athletes at both public and private institutions have the right to earn compensation for the use of their name, image, and likeness (Neb. Rev. Stat. § 48-3603). The statute prohibits postsecondary institutions and collegiate athletic associations from penalizing athletes for exercising these rights. Athletes can hire licensed agents to represent their NIL interests under § 48-3604, and agents must be registered with the state to represent Nebraska athletes.

The statute imposes several important limitations. Compensation must be for services actually performed (§ 48-3603(5)). Athletes cannot enter into NIL contracts that extend beyond their participation in the athletic program, involve the sale of awards received for athletic participation, or provide compensation for work not performed. Institutions may prohibit athletes from entering contracts that are “reasonably deemed to be inconsistent with the educational mission” of the institution (§ 48-3603(6)). Athletes cannot enter NIL deals that conflict with existing team contracts — but the institution must disclose the conflicting team contract to the athlete (§ 48-3605).

The 2024 amendments through LB 1393 further clarified that Nebraska institutions can assist athletes with NIL activities by providing legal support, access to department resources, team facilities, equipment, social media support, and photographers. Critically, LB 1393 also clarified that NIL compensation from an institution — as now permitted under the House settlement — does not inherently make the athlete an employee of the institution. This provision directly addresses one of the unresolved legal questions in college athletics: whether revenue sharing triggers an employment relationship with tax, benefits, and collective bargaining implications.

How Does Revenue Sharing Interact with Third-Party NIL Deals?

This is the question that is reshaping the economics of college athletics in real time. Under the House settlement, institutional revenue sharing and third-party NIL deals are treated as separate categories — but they interact in important ways.

Revenue-sharing payments come directly from the institution and count against the school’s $20.5 million annual cap. Third-party NIL deals — endorsements, social media sponsorships, autograph signings, camp appearances — are separate and do not count against the school’s cap. However, third-party deals over $600 must be submitted to the CSC for approval, and the CSC can reject deals it determines exceed fair market value.

The practical effect is that third-party NIL has become the primary mechanism for schools and collectives to supplement revenue sharing beyond the cap. Athletic directors across the country have acknowledged that “redirecting” revenue through third-party NIL structures is a common workaround to the revenue-sharing ceiling. This is exactly what the Nebraska-Playfly dispute involves — and exactly what the CSC is trying to police.

For Nebraska athletes, this means that the structure and documentation of third-party NIL deals is more important than ever. A deal that clearly ties compensation to specific promotional activities — social media posts, autograph sessions, commercial appearances, camp instruction — is far more likely to survive CSC scrutiny than a deal that pays an athlete with minimal performance obligations. Athletes and their representatives need to ensure that every NIL contract includes clear deliverables, defined timelines, and compensation tied to identifiable services.

What About Nebraska High School Athletes and NIL?

The Nebraska Fair Pay to Play Act does not address NIL at the high school level. This leaves regulation to the Nebraska School Activities Association (NSAA), which governs public high school athletics in the state.

The NSAA Board of Directors voted in December 2021 to allow high school athletes to profit from their name, image, and likeness, subject to specific conditions. Under NSAA Bylaw 3.7.1.c, students may engage in NIL activities on an individual basis, but those activities cannot suggest the endorsement or sponsorship of the student’s NSAA member school. Athletes cannot use images of themselves in school uniforms, or clothing or gear depicting the school’s name or logo, in NIL activities. Violations can result in a determination of ineligibility.

For high school athletes and their families, this creates a narrow but real window for NIL activity. Social media endorsements, personal appearances, and product promotions are permitted as long as they are clearly individual and not school-affiliated. Athletes with significant social media followings or athletic reputations can begin building their NIL portfolio before college — but the line between permissible individual activity and impermissible school association requires careful navigation.

What Are the Tax Implications of NIL Income in Nebraska?

NIL income is taxable. Period. Whether the income comes from a third-party endorsement deal, an institutional revenue-sharing payment, or back damages from the House settlement, it is treated as ordinary income for federal tax purposes. Nebraska athletes must also pay Nebraska state income tax on NIL earnings.

Athletes receiving both revenue-sharing payments and third-party NIL income should anticipate a significant tax obligation. Nebraska’s top individual income tax rate was reduced under recent legislative changes, but athletes earning substantial NIL income — particularly those receiving both a full revenue-sharing allocation and multiple third- party deals — can face combined federal and state tax rates exceeding 30%.

Quarterly estimated tax payments are likely required for athletes whose NIL income exceeds their withholding. Failure to make estimated payments can result in penalties and interest from both the IRS and the Nebraska Department of Revenue. Athletes should work with a tax professional familiar with NIL income as early in the tax year as possible — not in April when the return is due.

The House settlement back-damages payments, when they are eventually distributed (currently delayed by appeals), will also be taxable income in the year received. Athletes who competed between 2016 and 2025 and are eligible for back damages should plan for the tax impact now.

What Should Nebraska Athletes, Families, and Businesses Do Right Now?

The NIL landscape in 2026 is more complex — and more valuable — than at any point since the rules changed. Here is what the different stakeholders should be doing.

College Athletes

Understand your revenue-sharing allocation and how it interacts with your third-party NIL deals. Ensure every NIL contract includes clear performance obligations and defined deliverables — vague contracts are the ones the CSC is rejecting. Disclose all NIL deals over $600 through NIL Go. Engage a licensed agent and an attorney who understands both Nebraska’s NIL statute and the House settlement terms. Do not sign contracts with perpetuity clauses, broad exclusivity provisions, or terms that extend beyond your college career without legal review.

High School Athletes

You can earn NIL income under NSAA rules, but keep it individual and school-neutral. No school uniforms, logos, or team affiliations in NIL content. Build your brand and social media presence now — it creates leverage for college NIL negotiations later. Document everything for tax purposes.

Families

Get involved early. NIL contracts are legal agreements with real consequences. A parent should not be the primary negotiator — hire a licensed agent and an attorney.
Understand the tax implications before, not after, the money arrives. If your child is a minor, additional protections and considerations apply under Nebraska law.

Businesses and Sponsors

If you are a Nebraska business considering an NIL sponsorship with a college athlete, your deal will be submitted to the CSC for review if it exceeds $600. Structure the contract around genuine marketing services — social media posts, appearance events, product endorsements — with clear deliverables and fair market compensation. Deals that look like gifts or booster payments will be flagged. Work with an attorney who can ensure the contract satisfies both Nebraska law and CSC requirements.

NIL Collectives

The pre-July 2025 model of pooling booster money and distributing it to athletes with minimal performance obligations is under direct attack from the CSC. Collectives that survive in 2026 will be the ones that operate like legitimate marketing businesses — matching athletes to sponsors, structuring deals with real deliverables, and documenting the commercial value of every transaction.

Frequently Asked Questions

Can Nebraska schools pay athletes directly now?

Yes. Under the House settlement, schools that opted into revenue sharing can distribute up to $20.5 million directly to athletes for the 2025-2026 academic year. The University of Nebraska and all Big Ten schools have committed to fully funding revenue sharing at the maximum level. These payments are separate from third-party NIL deals.

Do Nebraska athletes still need agents and lawyers for NIL deals?

More than ever. Revenue sharing creates a baseline, but third-party NIL deals remain the primary way athletes earn above the revenue-sharing cap. Every third-party deal over $600 is now subject to CSC review, and deals that lack clear deliverables are being rejected. A licensed agent and an attorney can structure deals that maximize value while surviving scrutiny. Under Nebraska law (Neb. Rev. Stat. § 48-3604), agents representing Nebraska athletes must be registered with the state.

Are Nebraska high school athletes allowed to earn NIL income?

Yes, with restrictions. The NSAA permits high school athletes to engage in NIL activities on an individual basis, but those activities cannot reference, suggest, or imply endorsement by the athlete’s school. Athletes cannot use school uniforms, logos, or team imagery in NIL content. Violations can result in loss of eligibility.

What happens if the CSC rejects my NIL deal?

Under the House settlement, athletes have the right to challenge a CSC rejection through arbitration. The arbitration process has a 45-day timeline. If the arbitration ruling goes against the athlete, it may be possible to seek judicial review — and in Nebraska, the state NIL statute may provide an independent legal basis to challenge enforcement actions by collegiate athletic associations. This is the exact issue being tested in the current Nebraska-Playfly arbitration.

Is NIL income taxable in Nebraska?

Yes. All NIL income — whether from third-party deals, institutional revenue sharing, or House settlement back damages — is treated as taxable ordinary income for both federal and Nebraska state tax purposes. Athletes with significant NIL earnings should make quarterly estimated tax payments to avoid penalties.

If you are a Nebraska athlete, family, business, or collective navigating NIL in 2026, Horgan Law LLC can help. We are a licensed athlete agent and NIL law firm in Omaha representing athletes across Nebraska. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to discuss your situation.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

You’ve been removed from a corporate board and you’re ready to fight it in court. You file a declaratory judgment action against the board members who voted you out. The district court rules in your favor. Then the Nebraska Supreme Court vacates the entire judgment — not because you were wrong on the merits, but because you forgot to name the corporation itself as a party.

That’s exactly what happened in Powers v. Board of Directors of Elmwood Tower, a 2026 Nebraska Supreme Court decision that serves as a cautionary tale for anyone involved in corporate or nonprofit governance disputes. The case illustrates a procedural rule that trips up even experienced litigators: the requirement to join indispensable parties. If you get it wrong, you can win the trial and still lose everything on appeal.

Horgan Law LLC handles corporate governance disputes, director and officer liability claims, and business litigation throughout Nebraska.

What Happened in Powers v. Board of Directors of Elmwood Tower?

The case involved a nonprofit corporation where a director was removed by the other board members. The removed director filed a declaratory judgment action in the District Court for Douglas County, challenging her removal. She named as defendants the “Board of Directors,” the individual directors who voted for her removal, and her replacement.

Notably, she did not name the nonprofit corporation itself as a defendant.

The district court considered cross-motions for summary judgment on the merits. It concluded that the corporation had no “members” as defined by the Nebraska Nonprofit Corporation Act based on the corporation’s articles, found the removal provision in the bylaws valid, and granted summary judgment in favor of the defendants.

On appeal, the Nebraska Supreme Court never reached those substantive issues. Instead, it determined that the nonprofit corporation was an indispensable party — meaning the case could not proceed without it. The Court vacated the district court’s judgment and remanded with directions to dismiss without prejudice.

What Is an Indispensable Party Under Nebraska Law?

An indispensable party is a party whose interests are so directly connected to the subject matter of the litigation that the court cannot render a fair and complete judgment without them. Under Nebraska law, a court cannot adjudicate a case if doing so would affect the rights of a party not before the court.

Nebraska follows the framework set out in its Rules of Civil Procedure, which draws on the federal approach under FRCP Rule 19. The analysis has two steps. First, the court asks whether the absent party is “necessary” — meaning their absence would prevent complete relief or would impair the absent party’s interests. Second, if the necessary party cannot be joined, the court asks whether the party is “indispensable” — meaning the case should be dismissed rather than proceed without them.

In corporate and nonprofit disputes, the entity itself is almost always an indispensable party when the litigation involves governance decisions — board composition, removal of directors, validity of bylaws, or shareholder/member rights. That’s because the outcome directly affects the corporation’s governance and legal structure.

Why Can’t You Just Sue the Board of Directors?

The Powers court was emphatic on this point: a board of directors is not a separate legal entity that can be sued. The board is an organ of the corporation, not a freestanding person or organization with its own legal identity. You can sue individual directors (in their individual or official capacities), and you can sue the corporation — but the “Board of Directors” standing alone is not a proper defendant.

This distinction matters practically. A declaratory judgment about who sits on a corporation’s board necessarily affects the corporation’s interests. The corporation’s articles, bylaws, governance structure, and legal rights are all implicated. Without the corporation as a party, the court’s judgment would bind individuals but not the entity whose governance is actually at stake — an untenable result.

How Does This Apply to LLC Member Disputes and Shareholder Lawsuits?

The indispensable party principle extends beyond nonprofit corporations to closely held businesses, LLCs, and for-profit corporations. In shareholder disputes, if you’re challenging corporate action — an improper merger, a fraudulent dilution of shares, or a wrongful removal from management — you generally must name the entity as a party.

The same logic applies to LLC member disputes under Nebraska’s Uniform Limited Liability Company Act (Neb. Rev. Stat. §§ 21-101 et seq.). If your lawsuit challenges an LLC’s governance decision, membership rights, or operating agreement interpretation, the LLC itself is likely an indispensable party.

Derivative claims present a related but distinct scenario. In a derivative action, a shareholder or member sues on behalf of the entity against its directors or officers. Under Neb. Rev. Stat. § 21-20,100 (for corporations) and § 21-157 (for LLCs), the entity must be joined as a party, though it is typically a nominal defendant.

What Should You Do Before Filing a Corporate Governance Lawsuit?

The Powers decision offers a clear procedural lesson. Before filing any lawsuit involving corporate or nonprofit governance, work through this analysis.

Identify every party whose rights will be affected by the judgment. In governance disputes, this almost always includes the entity itself — not just the individuals involved.

Name the entity as a defendant (or nominal defendant in derivative claims). Do not assume that naming the board or individual directors is sufficient.

Review standing and capacity requirements. Who has authority to act on behalf of the entity? In a dispute where the board itself is divided, service and representation issues can become complex.

Consider the subject matter jurisdiction implications. The Powers court treated the failure to join an indispensable party as a jurisdictional defect — meaning the district court lacked authority to enter judgment without the corporation present. This is not a waivable error; it can be raised at any time, including on appeal.

Frequently Asked Questions

Can I add the corporation as a party after the case is filed?

Generally, yes. Nebraska’s rules allow amendment of pleadings to add parties, and the Powers court dismissed without prejudice — meaning the plaintiff could refile with the corporation properly named. However, adding a party after substantial litigation wastes time and money. It’s far better to get the party identification right at the outset.

Does this rule apply to for-profit corporations and LLCs too?

Yes. The indispensable party doctrine applies whenever the court’s judgment would affect the rights of an absent party. In closely held corporation disputes, LLC member disputes, and partnership disagreements, the entity itself is almost always an indispensable party if the litigation involves governance, ownership, or structural decisions.

What happens if I win at trial but didn’t name the right parties?

Your judgment may be vacated on appeal — exactly what happened in Powers. The court treated the failure to join the corporation as a defect going to subject matter jurisdiction, which cannot be waived. This means the opposing party can raise it for the first time on appeal, and the appellate court can raise it on its own.

Is a board of directors ever a proper defendant in Nebraska?

Generally, no. The board is not a legal entity separate from the corporation. You should name the corporation and, if appropriate, the individual directors in their individual or official capacities. In Powers, the Nebraska Supreme Court held that naming the board was not a substitute for naming the corporation.

If you’re facing a corporate governance dispute — whether as a director, shareholder, or LLC member — getting the procedural details right from the start is critical. Horgan Law LLC handles business litigation throughout Nebraska. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

A vendor promised to deliver materials by March 1 and didn’t show up until April. A business partner agreed to a non-compete and immediately started soliciting your clients. A buyer signed a purchase agreement and then backed out two weeks before closing. Every one of these is a breach of contract — and in Nebraska, the remedies available depend on the type of breach, the contract terms, and how quickly you act.

Contract disputes are among the most common business litigation matters in Nebraska. Whether you’re the aggrieved party seeking damages or the party defending against a breach claim, understanding how Nebraska courts analyze contract disputes is essential to protecting your interests.

This guide covers the elements of a breach of contract claim in Nebraska, the remedies available, the deadlines you need to know, and the strategic considerations that can make or break your case.
Horgan Law LLC handles contract disputes throughout Douglas County, Sarpy County, and across Nebraska, representing businesses and individuals in breach of contract litigation, enforcement, and defense.

What Are the Elements of a Breach of Contract Claim in Nebraska?

To prevail on a breach of contract claim in Nebraska, the plaintiff must prove four elements: (1) a valid contract existed between the parties; (2) the plaintiff performed or was excused from performing its obligations under the contract; (3) the defendant breached the contract; and (4) the plaintiff suffered damages as a result of the breach.

Each element can be contested. Was there really a meeting of the minds? Was the contract supported by adequate consideration? Did the plaintiff actually perform their end of the deal? Was the alleged breach material or trivial? Were the claimed damages actually caused by the breach, or by something else? Nebraska courts examine each element carefully, and failure to prove any one of them defeats the claim.

Does Nebraska Require Contracts to Be in Writing?

Not always, but certain types of contracts must be in writing under Nebraska’s Statute of Frauds, codified at Neb. Rev. Stat. § 36-202. Contracts that must be in writing include: agreements that cannot be performed within one year; contracts for the sale of real estate or an interest in real estate; promises to pay the debt of another; and contracts for the sale of goods over $500 (under the UCC, Neb. Rev. Stat. § 2-201).

Oral contracts that fall outside the Statute of Frauds are generally enforceable in Nebraska, but proving their terms is significantly harder. Without a written agreement, disputes become swearing matches about what was promised. Nebraska courts have held that parol evidence — oral testimony about the terms of a written contract — is generally inadmissible to contradict or vary the terms of an unambiguous written agreement. This is the parol evidence rule, and it means that if you have a written contract, the court will generally enforce what the document says regardless of what you claim was discussed verbally.

What Remedies Are Available for Breach of Contract in Nebraska?

Nebraska provides several categories of remedies for breach of contract.

Compensatory Damages

The primary remedy is money damages designed to put the non-breaching party in the position they would have been in had the contract been performed. This includes direct damages (the difference between what was promised and what was delivered) and consequential damages (foreseeable losses that flow from the breach). Under the rule of Hadley v. Baxendale — adopted by Nebraska courts — consequential damages are recoverable only if they were reasonably foreseeable at the time the contract was formed.

Specific Performance

When money damages are inadequate — typically in contracts involving unique property like real estate — Nebraska courts may order specific performance, compelling the breaching party to perform their contractual obligations. Neb. Rev. Stat. § 25-1062 authorizes specific performance when the legal remedy is inadequate. Nebraska courts generally presume that real estate is unique, making specific performance available in most real estate contract disputes.

Liquidated Damages

Many contracts include liquidated damages clauses — predetermined amounts payable upon breach. Nebraska courts enforce liquidated damages clauses if the amount is reasonable in light of the anticipated or actual harm caused by the breach, and if actual damages would be difficult to calculate. A liquidated damages clause that functions as a penalty — disproportionate to any reasonable estimate of damages — will not be enforced.

Rescission

In cases of material breach, fraud, or mutual mistake, the non-breaching party may seek rescission — cancellation of the contract and restoration of the parties to their pre-contract positions. Rescission is an equitable remedy that Nebraska courts grant when enforcement of the contract would be unjust.

What Is the Statute of Limitations for Contract Claims in Nebraska?

Nebraska imposes different deadlines depending on whether the contract is written or oral. For written contracts, the statute of limitations is five years under Neb. Rev. Stat. § 25-205. For oral contracts, it is four years under Neb. Rev. Stat. § 25-206. For contracts governed by the UCC (sale of goods), the limitations period is four years under Neb. Rev. Stat. § 2-725, though the parties may reduce it by agreement to not less than one year.

The clock generally starts running on the date of the breach. However, in cases where the breach is not immediately discoverable, Nebraska courts may apply the discovery rule, starting the limitations period when the plaintiff knew or should have known about the breach. This is fact-specific and not guaranteed.

What Defenses Can the Breaching Party Raise?

Common defenses in Nebraska breach of contract cases include: failure of consideration; impossibility or impracticability of performance; frustration of purpose; waiver (the non-breaching party’s conduct suggested they accepted the breach); statute of frauds (the contract should have been in writing); unconscionability (the terms are so one-sided as to be unenforceable); accord and satisfaction; and failure to mitigate damages.

Nebraska also recognizes the doctrine of substantial performance. If the breaching party substantially performed their obligations — completing 95% of a construction project, for example — the non-breaching party may not be entitled to walk away from the contract entirely but may recover damages for the deficient performance.

Frequently Asked Questions

Can I sue for breach of a verbal agreement in Nebraska?

Yes, as long as the agreement does not fall within the Statute of Frauds. Oral contracts are enforceable in Nebraska, but proving their terms can be challenging without written documentation. Courts will look at the conduct of the parties, any partial performance, and witness testimony to determine the contract terms.

What is a material breach versus a minor breach in Nebraska?

A material breach is a failure to perform a substantial part of the contract that defeats the purpose of the agreement. A minor breach is a failure that does not undermine the overall purpose of the contract. The distinction matters because a material breach excuses the non-breaching party from further performance, while a minor breach entitles the non-breaching party to damages but not to walk away from the contract.

Can I recover attorney fees in a Nebraska breach of contract case?

Generally, no. Nebraska follows the American Rule, which means each party pays their own attorney fees unless a statute or the contract itself provides otherwise. If your contract includes an attorney fees provision, the prevailing party may recover fees as specified. Some statutes, such as the Nebraska Uniform Deceptive Trade Practices Act, also allow fee recovery.

What should I do before filing a breach of contract lawsuit?

Review the contract carefully, including any dispute resolution provisions (mediation, arbitration, or litigation requirements). Gather all relevant documentation — the contract itself, correspondence, invoices, delivery records, and any communications about the breach. Send a formal demand letter. Many disputes resolve after a clear demand, and a well-crafted demand letter also demonstrates that you acted reasonably if the case goes to court.

If you’re dealing with a breach of contract — whether you need to enforce an agreement or defend against a claim — Horgan Law LLC can help. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to discuss your situation.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

You showed up on time, hit your numbers, and never had a performance issue. Then on a Tuesday afternoon, your manager called you in and told you your position was being eliminated. No warning. No write-up. No explanation that made sense. You’re wondering: is this even legal?

In most cases, yes. Nebraska is an at-will employment state, which means that absent an employment contract or specific legal protection, your employer can terminate you for any reason, no reason, or even an unfair reason — as long as it’s not an illegal reason. Understanding the difference between a bad reason and an illegal reason is critical for Nebraska workers evaluating their options after a termination.

Horgan Law LLC represents employees and employers in employment law matters throughout the Omaha metro area and across Nebraska.

What Does At-Will Employment Mean in Nebraska?

Nebraska follows the at-will employment doctrine, which means that either the employer or the employee can end the employment relationship at any time, for any lawful reason, with or without notice. The Nebraska Supreme Court has consistently affirmed this principle. In Malone v. American Business Information, Inc., 262 Neb. 733 (2001), the Court held that the at-will employment doctrine remains the default rule in Nebraska unless modified by contract, statute, or recognized public policy exception.

This means your employer generally does not need to give you a reason for termination. They don’t need to follow progressive discipline. They don’t need to document performance issues. The at-will rule gives employers broad discretion — but that discretion has limits.

What Are the Exceptions to At-Will Employment in Nebraska?

Nebraska recognizes several important exceptions to the at-will doctrine. If your termination falls into one of these categories, you may have a legal claim even though Nebraska is an at-will state.

Discrimination

Federal law — through Title VII of the Civil Rights Act, the Age Discrimination in Employment Act (ADEA), the Americans with Disabilities Act (ADA), and other statutes — prohibits termination based on race, color, religion, sex (including pregnancy and sexual orientation), national origin, age (40 and older), disability, or genetic information. Nebraska’s Fair Employment Practice Act (Neb. Rev. Stat. §§ 48-1101 et seq.) provides parallel state-law protections and covers employers with 15 or more employees.

Retaliation

Employers cannot fire you for exercising a legal right. This includes filing a workers’ compensation claim (protected under Neb. Rev. Stat. § 48-116), reporting workplace safety violations to OSHA, reporting illegal activity (whistleblowing), filing a discrimination complaint, or participating in a government investigation. The Nebraska Supreme Court recognized the public policy exception to at-will employment in Ambroz v. Cornhusker Square Ltd., 246 Neb. 374 (1994), holding that termination violating a clear mandate of public policy is actionable.

Breach of Contract

If you have a written employment contract that specifies the duration of employment or requires cause for termination, your employer must comply with those terms. Even without a formal contract, Nebraska courts have recognized that employee handbooks can create implied contracts in certain circumstances. In Johnson v. National Beef Packing Co., 220 Neb. 235 (1985), the Nebraska Supreme Court held that handbook provisions can become part of the employment contract if the employee can demonstrate reliance on those provisions.

Violation of Public Policy

Nebraska recognizes a public policy exception to at-will employment. You cannot be fired for refusing to participate in illegal activity, for performing a public obligation (such as jury duty), or for exercising a statutory right. The public policy must be clearly established by constitution, statute, or judicial decision — not just a general sense of fairness.

What Should I Do If I Think I Was Wrongfully Terminated?

If you believe your termination was illegal rather than merely unfair, take these steps promptly.

Document everything. Write down the circumstances of your termination while they’re fresh: who said what, when, any witnesses present, and any prior incidents that may be relevant. Save copies of performance reviews, emails, text messages, and any company communications related to your termination.

Don’t sign anything immediately. Employers often present severance agreements or separation agreements that include broad releases of claims. You have the right to review these documents with an attorney before signing. Under the ADEA, employees over 40 must be given 21 days to consider a severance agreement and 7 days to revoke after signing.

File a charge if applicable. Discrimination and retaliation claims under federal law generally require you to file a charge with the Equal Employment Opportunity Commission (EEOC) before filing a lawsuit. Under Nebraska state law, you file with the Nebraska Equal Opportunity Commission (NEOC).

There are strict deadlines: 300 days from the date of termination for EEOC charges in Nebraska (because Nebraska has a state agency), and 300 days for NEOC charges.

Consult an attorney. Employment law claims are time-sensitive and fact-specific. An experienced attorney can evaluate whether your termination falls into one of the exceptions to at-will employment and advise you on the strength of your claim.

What Damages Can I Recover for Wrongful Termination in Nebraska?

Available damages depend on the type of claim. For discrimination claims under Title VII and the Nebraska Fair Employment Practice Act, remedies include back pay (lost wages from the date of termination), front pay (future lost wages), compensatory damages for emotional distress, and attorney fees. Federal law caps compensatory and punitive damages based on employer size — from $50,000 for employers with 15-100 employees to $300,000 for employers with more than 500 employees.

For breach of contract claims, damages typically include the compensation you would have received under the contract. For public policy tort claims, damages can include compensatory damages and, in cases involving egregious conduct, punitive damages.

Frequently Asked Questions

Can my employer fire me without warning in Nebraska?

Generally, yes. Nebraska’s at-will employment doctrine does not require employers to give notice or warnings before termination. However, if your employer has a progressive discipline policy in an employee handbook, and you relied on that policy, the handbook provisions may create an implied contract that modifies the at-will relationship.

Is it wrongful termination if my employer lied about the reason?

Not necessarily. An employer can give a false or pretextual reason for termination without it being illegal — unless the real reason is an illegal one, such as discrimination, retaliation, or violation of public policy. If you can show that the stated reason was a pretext for an illegal motive, that evidence supports a wrongful termination claim.

Can I sue for wrongful termination if I was an at-will employee?

Yes, if your termination violated one of the recognized exceptions to at-will employment: discrimination, retaliation, breach of contract (including implied contract from a handbook), or violation of public policy. Being at-will does not mean your employer can fire you for an illegal reason.

How long do I have to file a wrongful termination claim in Nebraska?

Deadlines vary by claim type. EEOC charges must be filed within 300 days. Nebraska breach of contract claims have a five-year statute of limitations for written contracts (Neb. Rev. Stat. § 25-205) and four years for oral contracts (§ 25-206). Tort claims, including public policy violations, generally have a four-year deadline. Do not delay in consulting an attorney.

If you believe you were wrongfully terminated from your job in Nebraska, Horgan Law LLC can evaluate your situation and advise you on your legal options. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

Your ex-spouse received restricted stock units from their employer during your marriage. The divorce decree divided some of those RSUs as property but excluded them from the child support calculation. Now, years later, they’re selling vested shares worth six figures annually — and your child support hasn’t changed. Can you do anything about it?

The Nebraska Supreme Court recently answered that question in Kingston v. Kingston, 320 Neb. 981 (2026). The decision is one of the most significant child support rulings in Nebraska in recent years, particularly for high-income families where stock-based compensation is a major component of earnings. Here’s what the case means for Nebraska parents — whether you’re seeking a modification or defending against one.

Horgan Law LLC represents clients in high-asset divorce and child support matters throughout Douglas County, Sarpy County, and across Nebraska.

What Are RSUs and Why Do They Matter for Child Support?

Restricted stock units (RSUs) are a form of equity compensation that employers — particularly in the tech, financial services, and corporate sectors — use to compensate and retain employees. Unlike salary, RSUs vest over time. When they vest, the employee owns actual shares of company stock, which can then be sold for cash.

The problem for child support purposes is classification. Are RSUs property (divided at divorce) or income (factored into ongoing support)? In many Nebraska divorces, RSUs get treated as property in the marital estate division — split between the spouses — without anyone considering whether the ongoing vesting and sale of RSUs should also count as income for child support purposes. Kingston clarifies that they can be both.

What Did the Nebraska Supreme Court Decide in Kingston v. Kingston?

In Kingston, the father’s original divorce decree calculated child support based on his salary and bonuses. His RSUs were excluded from the income calculation and instead divided as marital property. After the divorce, the father began selling his vested RSUs — something he had not done during the marriage — generating significant additional income beyond his salary.

The mother filed a complaint to modify child support, arguing that the father’s post-divorce RSU sales constituted a material change in circumstances justifying recalculation. The Douglas County District Court agreed, and the Nebraska Supreme Court affirmed.

The Court held several important points. First, the father’s post-divorce sale of RSUs was a material change in circumstances not contemplated by the original decree. Second, the fact that RSUs were previously discussed and divided as property in the divorce did not bar the mother from raising them again in the child support modification context — claim preclusion and issue preclusion did not apply.

Third, the district court did not abuse its discretion in including RSU income, averaging bonus payments over a three-year period, and accounting for taxes when recalculating support.

The practical result: child support increased from $667 per month to $1,123 per month while both children were minors.

Can RSUs Be Both Property and Income Under Nebraska Law?

Yes. Kingston makes clear that the same RSUs can be divided as marital property during divorce and later counted as income for child support modification. This is not double-counting in the court’s analysis — the property division addresses the value of the RSUs at the time of divorce, while the child support modification addresses the ongoing cash flow generated when those RSUs are later sold.

This is consistent with Nebraska’s broad definition of income for child support purposes. The Nebraska Child Support Guidelines define total monthly income to include income from all sources, and they require income to be annualized and divided by twelve. Neb. Ct. R. § 4-204 casts a wide net, encompassing wages, salaries, commissions, bonuses, dividends, interest, trust income, and virtually any other recurring receipt of money.

The key factor in Kingston was that the RSU sales produced real, recurring cash flow after the divorce — not hypothetical value sitting on paper. The court was dealing with vested shares that had actually been sold, giving the court a concrete record of funds received beyond salary and bonus.

What Qualifies as a Material Change in Circumstances for Child Support Modification?

Under Nebraska law, a court may modify a child support order when there has been a material change in circumstances that was not contemplated by the original decree. The change must be something the parties did not anticipate or account for at the time of the divorce.

In Kingston, the material change was the father’s new pattern of selling vested RSUs after the divorce — conduct that had not occurred during the marriage and was not factored into the original support calculation. The court emphasized that this was not simply a change in law (following the Nebraska Supreme Court’s earlier decision in Vanderveer, which had recognized RSU income), but a change in the father’s actual financial conduct.

Common material changes that can support a modification request include: a significant increase or decrease in either parent’s income; a change in custody or parenting time; a child’s changed needs (medical expenses, educational costs); the emancipation of one child when support covers multiple children; or the loss or gain of employment.

How Does This Affect High-Income Nebraska Divorces Going Forward?

Kingston has several practical implications for Nebraska families dealing with equity compensation.

For parents paying support: if you receive RSUs as part of your compensation and are selling vested shares, you should expect that this income may be included in a future child support calculation — even if your original decree excluded RSUs from the income analysis. Planning for this possibility is important, particularly when negotiating the original divorce settlement.

For parents receiving support: if your co-parent’s financial situation has materially changed since the original decree — whether through RSU sales, promotions, bonuses, or other increased compensation — you may have grounds to seek a modification. The fact that RSUs were addressed in the property division does not prevent you from raising them in a support modification.

For attorneys drafting divorce decrees: Kingston underscores the importance of addressing RSU income explicitly in the original decree and child support worksheets. If the parties intend for RSUs to be excluded from future support calculations, that intent should be documented clearly — though whether such an exclusion would bind a future court is an open question.

Frequently Asked Questions

Do all RSUs count as income for child support in Nebraska?

Not necessarily. The Kingston decision turned on the fact that the father was actually selling vested RSUs and receiving cash proceeds. Unvested RSUs that haven’t been sold are less likely to count as current income, though they may be relevant to the overall financial picture. The critical factor is whether the RSUs have produced real, usable income.

Can I modify child support if my ex got a raise but doesn’t have RSUs?

Yes. Any material change in circumstances — including a significant salary increase, new bonus structure, or additional income source — can support a modification request under Nebraska law. The Kingston case specifically addressed RSUs, but the material-change standard applies broadly to all forms of income.

How far back can a child support modification be applied in Nebraska?

Nebraska courts have discretion on retroactivity. In Kingston, the court applied the modification retroactively but not as far back as the mother requested. Generally, modifications can be applied back to the date the complaint for modification was filed, but the specific retroactivity date is within the court’s discretion.

What if my divorce decree specifically excluded RSUs from income?

Kingston held that the original decree’s treatment of RSUs as property (rather than income) did not bar a later modification based on changed circumstances. However, if your decree contains specific language about RSU income and future modifications, that language may affect the analysis. Consult an attorney to review your specific decree.

If you have questions about child support modification, RSU income, or any high-asset family law matter in Nebraska, Horgan Law LLC can help. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to schedule a consultation.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

You’re sitting at a red light on Dodge Street when another driver rear-ends you at 35 miles per hour. Your neck hurts, your bumper is crumpled, and the other driver is already on the phone with their insurance company. What you do in the next 48 hours will shape whether you recover fair compensation — or get stuck with medical bills and a lowball settlement offer.

Every year, thousands of motor vehicle accidents happen across Douglas County, Sarpy County, and the greater Omaha metro area. Nebraska’s comparative fault system, specific insurance requirements, and statute of limitations create a legal framework that accident victims need to understand from the moment the collision happens. This guide walks through the steps you should take after a car accident in Omaha, the legal rules that apply, and the mistakes that cost Nebraska accident victims the most money.

Horgan Law LLC is a personal injury firm in Omaha that represents accident victims throughout Nebraska. We handle car accident claims in Douglas County District Court and Sarpy County District Court.

What Should I Do Immediately After a Car Accident in Nebraska?

Nebraska law requires you to stop at the scene of any accident involving injury or property damage. Under Neb. Rev. Stat. § 60-696, leaving the scene of an accident involving injury is a Class IIIA felony. Even for property-damage-only accidents, leaving without exchanging information is a misdemeanor under § 60-698. Beyond the legal obligation, what you do at the scene creates the foundation of your claim.

First, call 911. In Omaha, police will respond to accidents involving injury. For property-damage-only accidents, the Omaha Police Department may direct you to file a report online or at a station — but always request a responding officer if anyone is injured. The police report is one of the most important pieces of evidence in your claim.

Second, document everything. Use your phone to photograph the damage to all vehicles, the road conditions, traffic signals, skid marks, and any visible injuries. Take wide shots showing the intersection or road layout, and close-ups of the damage. Get the other driver’s name, insurance information, and license plate. If there are witnesses, get their contact information.

Third, seek medical attention. Even if you feel fine at the scene, many serious injuries — whiplash, concussions, herniated discs, and internal bleeding — don’t produce symptoms for hours or days. The insurance company will use any gap in treatment against you. Go to the emergency room or an urgent care facility within 24 hours. Tell the medical provider exactly what happened and describe every symptom, even minor ones.

How Does Nebraska’s Comparative Fault Rule Affect My Claim?

Nebraska follows a modified comparative fault system under Neb. Rev. Stat. § 25-21,185.09. This means you can recover damages as long as your fault does not equal or exceed the fault of the person you’re suing. If you’re found 49% at fault, you can still recover — but your damages are reduced by your percentage of fault. At 50% or more, you recover nothing.

This rule matters more than most accident victims realize. Insurance adjusters routinely argue that the injured person bears partial fault — for following too closely, for failing to brake in time, for not wearing a seatbelt. Nebraska’s seatbelt defense (Neb. Rev. Stat. § 60-6,270) allows the defendant to argue that your failure to wear a seatbelt contributed to your injuries, although this defense is limited to reducing damages rather than barring the claim entirely.

Everything you say at the scene and to the insurance company can be used to increase your comparative fault percentage. This is why you should never apologize at the scene or give a recorded statement to the other driver’s insurance company without legal advice.

What Is the Deadline for Filing a Car Accident Lawsuit in Nebraska?

Nebraska’s statute of limitations for personal injury claims is four years from the date of the accident under Neb. Rev. Stat. § 25-207. For property damage claims, the deadline is also four years under § 25-207. While four years sounds generous, waiting too long creates serious problems: witnesses move, memories fade, surveillance footage gets deleted, and physical evidence disappears.

If a government vehicle or government employee caused the accident, the timeline is dramatically shorter. Claims against the State of Nebraska under the State Tort Claims Act (Neb. Rev. Stat. §§ 81-8,209 et seq.) require you to file a claim with the Risk Manager within two years. Claims against cities and counties in Nebraska follow the Political Subdivisions Tort Claims Act (Neb. Rev. Stat. §§ 13-901 et seq.), which imposes a one-year filing deadline. Missing these deadlines bars your claim entirely.

What Damages Can I Recover After a Car Accident in Nebraska?

Nebraska allows accident victims to recover both economic and non-economic damages. Economic damages include medical bills (past and future), lost wages, lost earning capacity, and property damage. Non-economic damages include pain and suffering, emotional distress, loss of enjoyment of life, and disfigurement.

Nebraska does not cap non-economic damages in standard personal injury cases. However, the Nebraska Hospital-Medical Liability Act (Neb. Rev. Stat. §§ 44-2801 et seq.) does impose caps on medical malpractice claims — a distinction that matters if your accident injuries were worsened by negligent medical treatment.

If the at-fault driver was driving under the influence, texting while driving, or engaged in other egregious conduct, you may also be entitled to punitive damages — though Nebraska courts rarely award them without clear evidence of malice or willful recklessness.

How Do Insurance Companies Handle Car Accident Claims in Nebraska?

Nebraska is a fault-based insurance state. That means the at-fault driver’s liability insurance pays for the other party’s damages. Nebraska requires minimum liability coverage of $25,000 per person for bodily injury, $50,000 per accident for bodily injury, and $25,000 for property damage (commonly called 25/50/25 coverage).

The problem is that these minimums are woefully inadequate for serious accidents. A single ER visit, ambulance ride, and round of imaging can exceed $25,000. If the at-fault driver carries only minimum coverage, your options include filing a claim under your own underinsured motorist (UIM) coverage — which Nebraska insurers must offer but drivers can reject in writing — or pursuing the at-fault driver’s personal assets.

Insurance adjusters work for the insurance company, not for you. Their job is to minimize payouts. They will ask for recorded statements (you’re not required to give one to the other driver’s insurer), request broad medical authorizations (only provide records related to the accident), and make early settlement offers before you know the full extent of your injuries. Early offers almost always undervalue your claim.

Common Mistakes That Hurt Nebraska Car Accident Claims

The most common mistakes we see are: giving a recorded statement to the other driver’s insurance company without legal advice; signing a broad medical records authorization that allows the insurer to access your entire medical history; posting about the accident on social media (insurance adjusters monitor your accounts); failing to follow through on medical treatment; and waiting too long to document injuries and damages.

Another costly mistake is accepting the first settlement offer. Insurance companies often make early offers when they know the claim is worth significantly more — banking on the fact that injured people need money quickly. Once you accept a settlement and sign a release, you cannot go back for more compensation even if your injuries turn out to be worse than you thought.

Frequently Asked Questions

Should I call the police after a minor car accident in Omaha?

Yes. Even for minor accidents, a police report creates an official record of the incident. In Omaha, the police department may direct you to file a report online for property-damage-only accidents, but always request a responding officer if there are any injuries. The report documents the other driver’s information, witness statements, and the officer’s observations — all of which are valuable if a dispute arises later.

How much is my Nebraska car accident case worth?

The value depends on the severity of your injuries, the amount of your medical bills and lost wages, the impact on your daily life, and the degree of the other driver’s fault. Nebraska does not cap non-economic damages in standard personal injury cases, so serious injuries involving permanent impairment or chronic pain can result in substantial recoveries. An accurate valuation requires a complete picture of your medical treatment and prognosis.

Can I still recover if I was partially at fault for the accident?

Yes, as long as your fault is less than 50%. Nebraska’s modified comparative fault rule under Neb. Rev. Stat. § 25-21,185.09 reduces your recovery by your percentage of fault but does not bar it entirely unless you are 50% or more at fault. For example, if you are found 20% at fault and your damages are $100,000, you would recover $80,000.

How long do I have to file a car accident lawsuit in Nebraska?

The general statute of limitations for personal injury claims in Nebraska is four years under Neb. Rev. Stat. § 25-207. However, claims against government entities have much shorter deadlines — as short as one year under the Political Subdivisions Tort Claims Act. Do not wait until the deadline approaches to consult an attorney.

Do I need a lawyer for a car accident claim in Nebraska?

Not every accident requires a lawyer, but you should consult one if you have significant injuries, disputed fault, an underinsured at-fault driver, or if the insurance company is pressuring you to settle quickly. An experienced personal injury attorney understands how to value your claim, negotiate with insurers, and file suit if necessary.

If you’ve been injured in a car accident in Omaha or anywhere in Nebraska, Horgan Law LLC can help you understand your options and protect your claim. Contact us at 402-965-0652 or visit horganlawfirm.com/contact-us to schedule a consultation.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

Litigation rarely follows a clean path from filing to verdict. Cases take years. Witnesses move. Evidence gets lost. And sometimes, one of the parties dies before the case is resolved.

When that happens, most people assume the lawsuit simply continues with whoever is left, or that the case quietly disappears. Neither assumption is correct under Nebraska law. The death of a party during pending litigation triggers a specific, mandatory legal process governed by Nebraska statute and interpreted by decades of case law. Getting it wrong has serious consequences, whether you are the party whose opponent has died, the estate of the deceased party, or anyone else with a stake in the outcome.

This article explains what Nebraska law requires when a party dies during litigation, why those requirements exist, and what the 2023 Nebraska Supreme Court decision in Muller v. Weeder means for pending cases across the state.

The Fundamental Rule: Death Suspends the Action

The starting point is a principle that surprises many people: when a party to a pending lawsuit dies, the lawsuit does not automatically continue, and it does not automatically end. Instead, it is suspended.

The Nebraska Supreme Court stated this rule directly in Muller v. Weeder, 313 Neb. 63U, U86 N.W.2d 38 (2023): when a pending action survives the death of a party, “the death of a party results in a suspension of further proceedings in the suit for want of proper parties.” The court has jurisdiction to take exactly one action during this suspension period: to revive the action in the name of the personal representative or successor in interest, in response to a properly filed motion for revivor.

That is it. No other action. No rulings on the merits. No motions decided. No orders entered. Until revivor occurs, the court is jurisdictionally frozen on that case, and any order it enters during the suspension period is void.

This is not a procedural technicality. It is a jurisdictional rule. And as Muller makes clear, the consequences of ignoring it are severe.

Abatement Versus Survival: The First Question

Before the suspension rule kicks in, a threshold question must be answered: does the action survive the party’s death at all, or does it abate?

Nebraska law distinguishes between actions that survive death and actions that abate upon death. If the action abates, the death is absolute and the case ceases to exist. There is no suspension, no revivor, and no continuation. The action is simply gone.

Nebraska Revised Statute Section 25-1402 lists the actions that abate upon the death of a defendant: libel, slander, malicious prosecution, assault, assault and battery, and nuisance. Actions brought on those theories end when the defendant dies. Full stop.

Everything else generally survives. Nebraska Revised Statute Section 25-1401 identifies specific causes of action that survive death, including causes of action for injury to real or personal property, for deceit or fraud, and for mesne profits, in addition to causes of action that survived death at common law. Nebraska case law further limits the survival list by excluding actions that involve purely personal rights, even if not specifically enumerated as abating.

In practical terms, most commercial and property disputes survive the death of a party. Breach of contract claims survive. Claims for damage to real estate survive. Claims for contribution survive. The Muller case itself involved a fence dispute action seeking contribution, and the Supreme Court held that contribution actions survive the death of a party and can be revived in the name of the decedent’s personal representative.

If the action survives, the suspension rule applies and the revivor process must follow.

What Is Revivor and Why Does It Exist?

Revivor is the legal process by which a suspended action is formally restarted in the name of the proper party after a participant’s death. Nebraska’s revivor statutes are set out in Sections 25-1403 through 25-1420 and Section 25-322 of the Nebraska Revised Statutes.

The purpose of revivor is straightforward: a deceased person cannot be a party to a lawsuit. They cannot testify. They cannot make decisions. They cannot be bound by judgments.

Allowing litigation to proceed in the name of a deceased party, or allowing their former counsel to continue making decisions on their behalf, would be a legal fiction with no legitimate basis.

When a party dies, their legal interests do not evaporate. Those interests pass to their estate and are administered by a personal representative appointed by the probate court. The personal representative has fiduciary duties to the estate’s beneficiaries. Allowing a co- plaintiff, an heir, or the deceased party’s former litigation counsel to carry those interests forward without formal authorization circumvents the probate process entirely and deprives the estate’s beneficiaries of the protections the law provides them.

Revivor is how the law transfers the deceased party’s litigation interests to the proper person, under court supervision, with proper notice and opportunity to be heard.

How the Revivor Process Works in Nebraska

Nebraska’s revivor statutes establish a specific procedure. The mechanics depend on whether the deceased party was a plaintiff or a defendant, but the framework is the same in either direction.

Conditional Order of Revivor. Under Section 25-1406, the court issues a conditional order of revivor requiring the personal representative or successor in interest to show cause why the action should not be revived in the estate’s name. This order is served on the personal representative in the same manner as an original summons, ensuring that the estate has formal notice and an opportunity to respond.

Consent-Based Revivor. Under Section 25-1408, revivor can also occur by consent. If all parties agree, the action can be revived without a conditional order and show cause proceeding. In practice, consent-based revivor is faster and simpler, but it requires the cooperation of the personal representative.

Revival Through Substitution. Section 25-322 allows revivor through substitution of parties, accomplished by filing supplemental pleadings and serving summons as in the commencement of a new action. This is an alternative pathway that accomplishes the same result.

Critical Jurisdictional Point. Whichever method is used, one rule is absolute: revivor must occur in the court that has jurisdiction over the action at the time of the party’s death. The Muller decision made this point with particular force. In that case, Weeder died while the action was pending in the Court of Appeals. The Supreme Court held that only the Court of Appeals had jurisdiction to revive the action. The county court’s attempts to conduct proceedings on remand after Weeder’s death, without revivor having occurred in the Court of Appeals, were void for the same reason.

This rule has direct practical significance. If a party dies while a case is on appeal, the trial court cannot revive it. The appellate court must act. If the case is in the trial court, the trial court must act. The court with jurisdiction at the moment of death is the only court that can break the suspension.

The Consequences of Proceeding Without Revivor

The Muller case illustrates what happens when litigation proceeds without revivor, and the consequences are dramatic.

In Muller, Weeder died in October 2017 while the case was pending in the Nebraska Court of Appeals. No one filed a suggestion of death. No revivor occurred. The Court of Appeals, apparently unaware of Weeder’s death, issued a full opinion reversing the judgment below and remanding for further proceedings. After remand, the county court conducted a civil contempt hearing, found Weeder’s brother and sister in contempt, and entered a money judgment against them. The district court then dismissed a subsequent appeal for lack of jurisdiction.

When the case finally reached the Nebraska Supreme Court, the Court vacated everything. The Court of Appeals’ opinion and mandate in the first appeal. All orders and judgments entered on remand. Every piece of work product generated after the date of Weeder’s death, across multiple courts and multiple proceedings, was wiped out as void for lack of jurisdiction.

The Supreme Court’s reasoning was simple and unforgiving: when a court lacks jurisdiction and nonetheless enters an order, that order is void and of no force and effect. No exception for orders entered in good faith. No exception for orders entered without knowledge of the death. No exception for orders that had been relied upon for years. Void means void.

For practicing attorneys, Muller is a wake-up call. The obligation to promptly file a suggestion of death and initiate revivor proceedings is not a formality. It is a mandatory step that, if omitted, can unwind years of litigation and impose significant costs on all parties.

The Personal Representative’s Role and Authority

When a party dies and leaves a surviving cause of action, that cause of action becomes an asset of the decedent’s estate. It belongs to the estate, not to the decedent’s heirs, devisees, co-plaintiffs, or former litigation counsel.

Under the Nebraska Probate Code, the right and duty to sue and recover assets for an estate reside exclusively in the estate’s appointed personal representative. In re Estate of Hedke, 278 Neb. 727, 775 N.W.2d 13 (200U). The personal representative is a fiduciary under Nebraska Revised Statute Section 30-2464, obligated to collect, manage, and distribute the estate’s assets for the benefit of the estate’s creditors and beneficiaries.

A surviving cause of action is an asset with potential economic value. The personal representative has an obligation to evaluate that asset and make a reasoned decision about whether to pursue it. That decision belongs to the personal representative, not to anyone else.

Several practical consequences follow from this framework. First, former litigation counsel for the deceased party does not automatically continue to represent the estate. Under In re Conservatorship of Franke, 2U2 Neb. U12, 875 N.W.2d 408 (2016), an attorney’s representation of a client generally ends upon the client’s death, absent a contractual agreement to the contrary. Former counsel may have obligations to protect the estate’s interests by notifying the personal representative of the pending claim, but they do not have authority to make decisions on the estate’s behalf.

Second, a co-plaintiff or surviving joint tenant cannot carry the deceased party’s claims forward by virtue of their own party status. Whatever interest passes to a surviving co- plaintiff by operation of law, the right to prosecute the deceased party’s surviving claims belongs to the estate’s personal representative. The merger of a property interest under joint tenancy law is not the same as the right to prosecute a breach of contract or tort claim that accrued to the decedent personally before death.

Third, an expression of preference by former counsel, or even by the personal representative through informal channels, is not a formal election. Until the personal representative appears in the litigation, under court supervision, and makes a formal decision on the record, the action remains suspended.

The Defendant’s Right to Compel Revivor

What happens when the personal representative does nothing? Or when former counsel simply announces, informally, that the estate does not intend to pursue the claims?

The surviving party does not have to wait indefinitely. Nebraska Revised Statute Section 25- 1416 gives the surviving party the right to compel revivor of the action. The statute is a recognition that prolonged suspension prejudices the other side, who cannot get a final resolution while the case sits in jurisdictional limbo.

Under Section 25-1416, the surviving party can move the court to issue a conditional order of revivor and compel the personal representative to appear and make a formal election. If the personal representative appears and affirmatively declines to revive the action, the court should dismiss the deceased party’s claims with prejudice as formally abandoned. If the personal representative fails to appear, the action can proceed. Either way, the surviving party gets the certainty they are entitled to.

This mechanism matters because informal statements about the estate’s intentions have no legal effect on the action itself. A personal representative’s preference, communicated through former counsel who does not represent the estate, does not constitute a formal abandonment of the claims. It does not bind the estate. It does not resolve the case. And it does not protect the surviving party from the possibility of the estate later asserting those claims through properly appointed counsel.

The compelled revivor procedure provides the clean, supervised, on-the-record resolution that protects everyone.

The One-Year Deadline: Why Timing Matters

Nebraska’s revivor statutes impose time limits that create urgency for all parties.

Nebraska Revised Statute Section 25-1414 provides that a revivor order in the name of a plaintiff’s representative or successor shall not be made without the consent of the defendant after the expiration of one year from the time the order might first have been made. In plain terms: if the defendant declines to consent to revivor after the one-year window has passed, the right to revive is permanently gone.

The one-year clock starts running from the date of the plaintiff’s death, because that is when the revivor order could first have been made. If the personal representative waits too long, or if the matter drifts without resolution, the estate can permanently forfeit the right to revive the action. At that point, under Nebraska Revised Statute Section 25-1415, the court may order the action stricken from the docket.

This deadline creates a concrete and enforceable consequence for inaction. It also gives the defendant meaningful leverage: the defendant controls whether revivor can occur after the one-year window by withholding consent. That is a significant tactical position, and it is one that defendants should understand and actively manage.

The practical message for personal representatives is equally important. If you have been appointed to administer an estate that is party to pending litigation, you need to evaluate the pending claims promptly. The one-year window is not generous, particularly if the estate was not opened immediately after the decedent’s death and months have already passed.

Practical Takeaways for Litigants and Their Attorneys

The rules governing death of a party in Nebraska litigation are technical, but their practical implications are broad. Here is what parties on both sides of pending litigation should understand.

If your opponent dies during litigation: Do not assume the case continues automatically, and do not assume it disappears. File a suggestion of death promptly. Evaluate whether the action survives or abates. If it survives, begin monitoring the one-year revivor window immediately. Consider whether to move for compelled revivor rather than waiting for the estate to act. Determine whether any orders or proceedings have occurred since the death without revivor, because those orders may be void.

If you are the personal representative of an estate party to pending litigation: Understand that the pending lawsuit is an asset of the estate. You have fiduciary obligations to evaluate it. Former litigation counsel does not represent the estate unless you retain them. The other party can compel you to make a formal election, and if you fail to act within the statutory window, the estate’s right to revive may be permanently lost. Get independent counsel who represents your interests as personal representative, not the interests of the other co-plaintiffs or the decedent’s family.

If you are a co-plaintiff or heir of the deceased party: You do not automatically step into the deceased party’s litigation shoes. The deceased party’s surviving causes of action belong to the estate. Your role as a co-plaintiff entitles you to prosecute your own claims, not the estate’s claims. These are separate legal interests with potentially different damages, different statutes of limitations, and different strategic considerations.

If you are litigation counsel for any party: The obligation to file a suggestion of death and initiate revivor proceedings is not something to defer. As Muller demonstrates, every order entered without revivor is void. The cost of unraveling years of void proceedings dwarfs the cost of prompt action at the outset.

Why the Muller Decision Matters Beyond Fence Disputes

Muller v. Weeder arose from a fence dispute between two neighboring landowners in rural Boyd County. The amounts in controversy were modest. But the legal principles the Nebraska Supreme Court articulated in that decision apply to every pending civil action in Nebraska where a party dies before final resolution.

The holding that all post-death proceedings without revivor are void is not limited to fence actions. It applies to breach of contract cases. It applies to personal injury litigation. It

applies to business disputes. It applies to real estate cases. Any pending civil action in a Nebraska court is subject to the suspension rule upon the death of any party, and any court that proceeds without revivor does so without jurisdiction.

For Nebraska litigants and their attorneys, Muller is essential reading. It clarifies rules that existed in Nebraska statutes for over a century but had not been applied with this degree of specificity and consequence in recent memory. Courts, parties, and counsel who are not paying attention to this framework risk exactly the outcome in Muller: years of litigation, multiple proceedings, and significant legal fees, all undone in a single Supreme Court opinion.

Contact Horgan Law LLC

Horgan Law LLC handles complex civil litigation across Nebraska, including disputes involving the death of a party, estate claims, probate litigation, and related matters. If you have questions about a pending lawsuit involving a deceased party, revivor requirements, or the interaction between civil litigation and probate administration, contact our office to discuss your situation.

This article is intended for general educational purposes and does not constitute legal advice. Every situation is different. Consult a licensed Nebraska attorney for guidance specific to your circumstances.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.

If you own a business and you are facing divorce in Nebraska, the stakes are fundamentally different than they are in a standard dissolution. Your business is likely one of your most significant assets — and unlike a retirement account or a piece of real estate, it cannot simply be divided down the middle.

How your business is treated in a Nebraska divorce depends on when you acquired it, how it has grown, how you have paid yourself, how your operating documents are structured, and what role, if any, your spouse has played in the business. The wrong strategy — or no strategy at all — can result in a court-ordered buyout that forces you to take on debt to pay your spouse, or worse, a settlement that disrupts the business operation itself.

This guide is written for business owners in Omaha and across Nebraska who are facing divorce and need to understand what is actually at stake and what they can do about it. Horgan Law LLC handles high-asset divorce cases involving business ownership throughout Douglas County, Sarpy County, and eastern Nebraska.

Is Your Business a Marital Asset Under Nebraska Law?

Nebraska is an equitable distribution state. Under Neb. Rev. Stat. § 42-365, courts divide marital property equitably — meaning fairly, though not necessarily equally. The first threshold question in any business owner divorce is whether the business (or any portion of it) is marital property subject to division.

Businesses Formed Before the Marriage

If you owned the business before the marriage, the pre-marital value of the business is generally treated as separate property and is not subject to division. However, any appreciation in value that occurred during the marriage — particularly appreciation attributable to marital effort and labor rather than passive market forces — may be treated as marital.

This distinction, known as active versus passive appreciation, is often contested in Nebraska business owner divorces. If you built the business significantly during the marriage through your own efforts, your spouse’s attorney will argue that the growth is marital. Your attorney will argue the opposite — and the result depends heavily on expert testimony and the specific facts of your business.

Businesses Formed During the Marriage

A business started during the marriage with marital funds or effort is presumptively marital property. That presumption can be partially overcome in limited circumstances — for example, if the business was funded entirely with an inheritance or gift — but it is a high bar.

The fact that only one spouse worked in the business does not make it separate property in Nebraska. Courts recognize that the non-business-owner spouse often supported the family in other ways that enabled the business owner to build the enterprise.

The Role of Commingling

Even if your business started as separate property, commingling — mixing separate and marital funds — can convert separate property into marital property. Using marital funds to invest in a pre-marital business, or paying personal expenses from business accounts without clear accounting, creates commingling arguments that can significantly complicate your case.

How Is a Nebraska Business Valued in Divorce?

Business valuation in divorce is a specialized field. Courts do not simply accept the business owner’s estimate of what the company is worth. In contested cases, each party typically retains an independent certified business valuator (CBV) or business appraiser to offer an opinion of value.

Nebraska courts have used three primary valuation methodologies:

Income Approach

Capitalizes the business’s expected future earnings. Most common for operating businesses with consistent cash flow. The valuator projects normalized earnings, applies a capitalization rate reflecting the risk of those earnings, and derives a present value. The key variables — normalized earnings and cap rate — are often heavily contested.

Asset Approach

Values the business based on the fair market value of its assets minus its liabilities. Most appropriate for asset-heavy businesses or holding companies. Less applicable to service businesses where value is in relationships and reputation.

Market Approach

Compares the business to recent sales of similar companies. Difficult to apply to closely held Nebraska businesses where comparable transaction data is limited. More useful for franchises or businesses in industries with active M&A markets.

Personal Goodwill vs. Enterprise Goodwill

One of the most important and most litigated valuation issues in Nebraska business owner divorces is the distinction between personal goodwill and enterprise goodwill.

Enterprise goodwill — the value attributable to the business itself, its systems, client relationships, and brand — is generally considered marital property subject to division. Personal goodwill — the value that exists solely because of the individual owner’s skills, reputation, and relationships that would not survive a sale to a third party — is generally treated as separate property.

For professional practices (medical, dental, legal, accounting), personal goodwill arguments are particularly strong. For businesses with diversified client relationships and operational systems that would survive a change in ownership, enterprise goodwill is more likely to dominate.

Protecting Your Business During a Nebraska Divorce

There are several practical and legal strategies business owners in Nebraska can employ to protect their interests. These are most effective when implemented with counsel — and ideally before the divorce is filed.

Understand Your Operating Documents

Review your shareholder agreement, operating agreement, or partnership agreement before divorce proceedings begin. These documents may contain provisions that restrict transfer of ownership interests, require other owners’ consent to a transfer, or address what happens in the event of a divorce. These provisions can be powerful tools — or constraints — depending on how they are drafted.

Maintain Clean Financial Separation

The more clearly your business finances are separated from your personal finances, the easier it is to trace what is business property and what is marital. Commingled accounts, personal expenses run through the business, or inconsistent compensation practices all create vulnerabilities that opposing counsel will exploit.

Prepare for Financial Discovery

In a contested business owner divorce, expect extensive financial discovery. Your spouse’s attorney will request tax returns (personal and business), financial statements, bank records, compensation histories, and potentially the company’s operating agreements and corporate minutes. An experienced attorney will help you respond to these requests in a way that protects legitimately privileged or confidential business information.

Consider a Structured Buyout

Most Nebraska courts will not force a sale of an operating business in divorce proceedings. The more typical outcome is a buyout — one spouse buys out the other’s interest over time. Structuring a buyout that works for your business’s cash flow while satisfying your spouse’s legitimate interest in their share of the marital estate is a negotiation challenge that requires both legal and financial expertise.

What If My Spouse Works in the Business?

If your spouse has been employed in the business or has played an operational role, the divorce becomes more complex on multiple dimensions. Issues that arise include:

• Whether your spouse’s continued employment in the business is feasible given the divorce
• Whether your spouse has an ownership claim based on their labor in the business
• Non-compete provisions — if your spouse intends to start a competing business after the divorce
• Access to business records and confidential information

Horgan Law LLC has experience handling divorces where one or both spouses have an active role in the business. The interplay between employment, ownership, and family law issues requires counsel that understands all three.

Prenuptial Agreements and Business Protection

If you are entering a business before marriage or contemplating a second marriage, a prenuptial agreement is the most effective protection for your business interests. A valid Nebraska prenuptial agreement can specify that the business — including its appreciation during the marriage — remains your separate property regardless of the outcome of any future divorce.

Nebraska’s Uniform Premarital Agreement Act governs prenuptial agreements in the state. To be enforceable, the agreement must be in writing, signed by both parties voluntarily, and not unconscionable. Both parties should have independent legal counsel when negotiating and signing a prenuptial agreement.

Horgan Law LLC — Business Owner Divorce Attorneys in Omaha

Horgan Law LLC represents business owners in divorce proceedings throughout Omaha, Douglas County, Sarpy County, and eastern Nebraska. Our practice includes both family law and business law, which gives us a distinct advantage in high-asset divorce cases involving business interests.

We understand business valuation, operating agreement interpretation, and the financial structures of closely held businesses — not just family law procedure. That combination is what business owner divorces require.

Managing Partner Tom Horgan is a Super Lawyers® Rising Star recognized in business and commercial litigation. Our office is located in West Omaha at 13304 West Center Road. We serve clients throughout Omaha, Elkhorn, Papillion, Bellevue, and the surrounding Nebraska area.

We offer a free initial consultation for business owner divorce matters. If your business is on the table, call us before you make any decisions about your next steps.

Ready to experience the difference? Contact Horgan Law today to discuss how we can assist. Your legal journey just got easier.