Nebraska State Tax Guide

Nebraska state tax rates and rules for income, sales, property, fuel, cigarette, and other taxes that impact residents.

picture of Nebraska state flag on flag pole against sunset in sky
(Image credit: Getty Images)

Nebraska state tax: Overview

Nebraska state tax is lower in some areas than in others. For example, property taxes in Nebraska are higher than the national average, but the state's cigarette tax is one of the lowest in the country.  And while Nebraska does have a hefty inheritance tax (for many types of heirs), some residents will pay less income tax due to a gradual reduction of the state's top income tax rate through 2027.

[Data for this state tax guide was gathered from a number of sources including the Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.] 

Nebraska income taxes

picture of the skyline in Omaha, Nebraska

(Image credit: Getty Images)

Nebraska Income Taxes: Married filing separately and single filers

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Up to $3,7002.46%
$3,700 to $22,170$91.02 plus 3.51%
$22,170 to $35,730$739.32 plus 5.01%
More than $35,730$1,418.68 plus 6.64% the amount over $35,730

Nebraska Income Taxes: Head of household

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Up to $6,9002.46%
$6,900 to $35,480$169.74 plus 3.51%
$35,480 to $52,980$1,172.90 plus 5.01%
More than $52,980$2,049.65 plus 6.64% of the amount over $52,980
  • 6.44% in 2024
  • 6.24% in 2025
  • 6% in 2026
  • 5.84% in 2027

Nebraska tax on retirement income: Nebraska is one of the 11 states that still tax Social Security retirement benefits. However, this tax will be repealed in 2025. Military retirement income and Railroad Retirement benefits are tax-exempt.

Nebraska sales tax

Nebraska has a 5.5% state sales tax rate. Localities can add as much as 2%, and the average combined rate is 6.971%, according to the Tax Foundation.

  • Groceries are tax-exempt.
  • Prescription drugs are tax-exempt.
  • Women's menstrual products are tax-exempt.
  • Diapers are taxable.

How much are property taxes in Nebraska?

little model house on a table

(Image credit: Getty Images)

In Nebraska, the average effective property tax rate is 1.67%, which is higher than in most states.

Nebraska Property Tax Breaks for Retirees

Homestead Exemption: Nebraska homeowners 65 and older and those with disabilities may qualify for homestead exemption. The income thresholds for homeowners 65 and older and those who qualify based on disability status differ. Nebraska residents can view the Homestead Exemption Information Guide to see if they qualify.

Nebraska gas taxes (motor fuel)

Gasoline: $0.29 per gallon

Diesel: $0.32 per gallon.

Nebraska taxes on alcohol and tobacco

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Cigarettes$0.64 per pack
Other tobacco products20% of wholesale price
Beer$0.31 per gallon
Wine$0.95 per gallon
Liquor$3.75 per gallon

Nebraska estate and inheritance taxes

Nebraska is one of the six states with an inheritance tax.  Spouses are off the hook from paying the tax, but other heirs could get a hefty tax bill.

  • Children, parents, siblings and grandparents are subject to a 1% tax on inheritances over $40,000.
  • Aunts, uncles, nieces and nephews pay a 13% tax on inheritances over $15,000.
  • Other heirs are responsible for an 18% inheritance tax on amounts over $10,000.
Katelyn Washington
Tax Writer

Katelyn has more than 6 years’ experience working in tax and finance. While she specializes in tax content, Katelyn has also written for digital publications on topics including insurance, retirement and financial planning and has had financial advice commissioned by national print publications. She believes that knowledge is the key to success and enjoys helping others reach their goals by providing content that educates and informs.