The Nebraska Banking, Commerce and Insurance Committee is reviewing Bill LB226 sponsored by Senator Colby Coash from of Nebraska. The bill puts Nebraska in line with the growing number of states that are establishing their own crowdfunding security exemptions ahead of stalled federal rules. The bill is said to be similar to the one passed by Indiana last year. Roughly 11 other states have now passed legislation and another 29 are in the progress of passing rules as of June 2015.
According to the new Nebraska crowdfunding bill, worth less than $1 million or couples making under $300,000 a year would be allowed to invest as much as $5,000 in a single business online. Funding for small businesses without audited statements will be capped at $1 million. With audited statements the funding may hit $2 million.
Businesses interested in utilizing the exemption will need to register with the Banking Department for a small fee. Nebraska crowdfunding is described as a method for people with moderate incomes to invest in a bar, restaurant or other any other small business. Investors, who must be Nebraskans, will be allowed to make deposits in the escrow fund through a third-party web portal. The company must specify the fundraising time frame and investment target, and investors can cancel their commitment if the target amount is not raised by the deadline. The company must also disclose the terms and conditions of the securities being offered. The company cannot access funds until the target amount has been met or exceeded.
Review the current Nebraska Crowdfunding Exemption:
Here are just a few features for Nebraska crowdfunding included in the CrowdForce platform software:
• State residency self-verification
• Driver’s license upload for verification
• Setting funding limits for non-accredited investors
• Allowing accredited investor participation
• Complete and simple document signing and management
• Integrated ACH payments
• Plug in your state escrow account
• Plugin in your broker services for accredited investments
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