LB 932 would amend Nebraska's tax code to create a specific income tax adjustment for tip income and overtime compensation. This adjustment would directly affect workers who earn tips (such as in restaurants or hospitality) or receive overtime pay (common in hourly jobs). The bill adds these income types to the list of modifications applied to federal income when calculating state tax liability. The adjustment would change how these specific income sources are treated in Nebraska's tax computation, though the exact mechanism (e.g., deduction or credit) is not detailed in the provided text. This policy change updates the state's tax code to address these income categories.
This bill eliminates a tax reduction currently available for extraordinary dividends and certain capital gains when calculating Nebraska income tax. It directly affects Nebraska taxpayers who receive these specific types of investment income, ending the existing tax break. The change takes effect for taxable years beginning on or after January 1, 2026, under the federal tax code. The bill repeals two specific sections of Nebraska's tax code (77-2715.08 and 77-2715.09) that previously provided this reduction.
LB 1206 would exempt the income of certificated teachers, paraeducators, and paraprofessionals from Nebraska's state income tax. The bill amends Nebraska's tax code to exclude this specific group's earnings from taxable income calculations. This change directly affects educators working in Nebraska public schools who hold these roles. The policy creates a targeted tax exemption without altering other tax provisions or requiring new administrative processes.
LB 930 would amend Nebraska's tax code to allow retired firefighters and law enforcement officers to deduct their annual retirement benefits from their state taxable income. This change would directly reduce the state income tax burden for eligible retired public safety officers. The bill creates a specific tax deduction for retirement benefits received by these groups, adjusting how their income is calculated for state tax purposes. The policy change is a concrete modification to Nebraska's tax code for this targeted group of retirees.
LB 1189 creates a pilot program to help low-income Nebraskans access the existing Earned Income Tax Credit (EITC) by increasing awareness and assistance. The Nebraska Department of Revenue will distribute $250,000 in grants to nonprofit organizations (like tax preparation services, legal aid, and health agencies) that serve low-income residents, funding outreach, education, and application help. Grants must be awarded by October 1, 2026, and the program requires an evaluation report by December 2027 detailing outreach efforts, participants served, and recommendations for future use. This directly affects eligible low-income Nebraskans who qualify for the EITC but may not claim it due to lack of awareness. The bill does not change the EITC itself but aims to improve access to the existing benefit.
LB 115 increases the income tax credit for volunteer emergency responders in Nebraska from its previous amount to $1,250 per year. It directly affects volunteer firefighters, emergency responders, and rescue squad members who are certified as active for the prior year. The bill changes qualification rules by requiring departments to submit certified lists of eligible volunteers to the state by February 15 each year, and volunteers claim the credit on their state tax returns using certification documents. The amendment replaces the previous credit amount and procedures under the Volunteer Emergency Responders Incentive Act.
LB 331 proposed replacing Nebraska's existing income, property, sales, and other taxes with a single "consumption tax" on goods and services, effective by 2028. It would have terminated the state income tax, property tax, sales tax, inheritance tax, and related laws by December 2027, while defining taxable items like groceries and education services. The bill aimed to shift the tax burden from income and property to consumption, with specific rules for exemptions and tax calculations. However, the bill was withdrawn on February 13, 2025, and is no longer active. As a withdrawn proposal, it did not become law or affect any taxpayers.
LB 710 increases Nebraska's earned income tax credit (EITC) for low- and moderate-income residents who qualify for the federal EITC. It raises the state refundable credit rate from 10% to 20% of the federal EITC amount for tax years beginning January 1, 2025, and adjusts income thresholds. The credit phases out for individuals with federal adjusted gross income above $22,000, reducing by 10% for each $1,000 earned over that amount. This change directly benefits eligible Nebraska residents who currently receive the federal EITC, providing them with additional state tax relief.
LB 208 modifies Nebraska's sales tax filing requirements based on annual tax liability: businesses with less than $900 yearly tax obligation file annually, those with $900-$3,000 file quarterly, and those over $3,000 file monthly. It adds rules for electronic payments via the streamlined sales tax agreement, requiring annual reconciliation and imposing a 50% penalty if payments miss the target by over 10%. The bill also updates confidentiality protections for sales tax data, adjusts annual limits for certain income tax credits, and clarifies filing rules for seasonal retailers and combined returns. These changes primarily affect Nebraska retailers and businesses collecting sales tax, streamlining compliance with state and multi-state tax agreements.
LB 509, the Opportunity Scholarships Act, creates tax credits for Nebraska individuals and businesses that donate to nonprofit organizations providing scholarships. These scholarships help low-income families pay for private school tuition at qualifying non-profit schools (meeting accreditation and safety standards). Eligible students must have household income at or below 213% of the federal poverty level, with priority given to those previously receiving scholarships or in specific hardship situations. The bill allows donors to claim tax credits equal to their contributions, directing funds through certified scholarship-granting organizations to support enrollment at participating private schools.
