How Nebraska taxes income
Nebraska uses a graduated income tax with 3 brackets, running from 2.46% up to 4.55%. A filer on $85,000 pays an effective 3.52%. The top rate is the last slice, not the whole bill (how graduated rates work).
The bands are narrow at the bottom, so most full-time workers reach the top rate quickly. In practice it behaves much like a flat tax for middle incomes.
Nebraska income tax brackets for 2026
Single filer rates. Married couples filing jointly use the same rates over wider bands, and on $120,000 a joint return works out at $3,700, the same as two single filers on $60,000 each pay between them.
| Rate | Taxable income over |
|---|---|
| 2.46% | $0 |
| 3.51% | $4,130 |
| 4.55% | $24,760 |
Worked examples for Nebraska
Using Nebraska's 2026 rates, standard deduction and exemptions:
| Situation | Nebraska tax | Effective state rate |
|---|---|---|
| Single, $60,000 | $1,850 | 3.08% |
| Single, $120,000 | $4,580 | 3.82% |
| Married filing jointly, $120,000 | $3,701 | 3.08% |
The joint figure is lower than the single figure on the same $120,000 only because the joint return covers two people's exemptions or credits; the rates themselves are the same.
Deductions and exemptions
Nebraska allows a state standard deduction of $8,850 for a single filer and $17,700 for a married couple filing jointly.
Rather than a personal exemption, Nebraska delivers the equivalent relief as a tax credit ($176 per person and $176 per dependent). A credit reduces the tax itself rather than the income it is charged on, which is generally worth more to lower earners than an equivalent deduction.
All told, an $85,000 salary is taxed on $76,150.
How Nebraska's income tax is put together
Nebraska runs 3 brackets, from 2.46% at the bottom to 4.55%. The top rate starts at $24,760 of taxable income, which is what decides whether the headline rate is one you will actually pay. Because that top bracket begins so low, most full-time earners in Nebraska reach it, and the graduated structure behaves much like a flat tax in practice. A single filer deducts $8,850 before the rates apply.
Nebraska's inheritance tax is levied by counties
Nebraska is the only state where the inheritance tax is a county tax. It is imposed and collected at county level and the proceeds stay there, funding county services rather than the state budget. Rates and exemptions turn on the heir's relationship to the deceased, and because it is a county tax it survives at a level of government that rarely touches personal income anywhere else in the country.
Repeal is proposed regularly and resisted by counties that depend on the revenue, so it has been narrowed rather than removed. None of it appears in the income tax figure above.
On income, Nebraska has been cutting toward a lower ceiling under a multi-year schedule, and its three bands are narrow enough that a full-time worker reaches the top one well before a high salary. There is no local income tax, so 4.55% is the complete income tax picture during your working life. The county layer only arrives at the end of it.
Part-year residents and out-of-state income
Nebraska has no reciprocity agreements, so if you live here and work in another state, or move mid-year, you will generally file in both, and claim a credit rather than an exemption. How the credit works, and why moving to a higher-tax state still costs you.
Retirement income in Nebraska
Nebraska does not tax Social Security benefits, which puts it with the large majority of states. Pensions and IRA or 401(k) withdrawals are treated separately. See how states treat retirement income.
As an upper bound, $60,000 of retirement income taxed as ordinary wage income would cost about $1,900 here, an effective 3.08%. Any exclusion Nebraska grants for pension or retirement-account income comes off that figure, so a retiree's real rate is usually lower than the brackets above suggest.
How Nebraska compares
Nebraska's top marginal rate of 4.55% ranks 27 of the 42 jurisdictions that tax income (41 states and D.C.). Iowa tops out at 3.8%. Kansas tops out at 5.58%. Missouri tops out at 4.7%. South Dakota has no income tax at all.
Filing and deadlines
Nebraska's return is due in mid-April with your federal return. Deadlines and extensions covers the off-cycle states and what an extension does not buy you.
What this estimate covers
The figure applies Nebraska's published 2026 rates and deductions to wage income, alongside federal tax and FICA (a well-sourced estimate, not a return). See what these calculators do and do not model.