What Is the Nebraska State Tax Rate in 2027?

The short answer

For 2027, the Nebraska state income tax rate tops out at 3.99%. Lower slices of income are taxed at about 2.46% and 3.51%.

The statewide sales tax rate is 5.5%, and cities may add up to about 2% more (Omaha totals 7%). Nebraska has no local income tax on wages.

If you only care about how much state tax leaves each paycheck, the Nebraska income tax withholding calculator gives a per-check figure based on your pay frequency and W-4N allowances.

Marginal vs. effective rate

Your marginal rate is the rate on your next dollar of income. Your effective rate is total Nebraska tax divided by your income.

Because Nebraska applies a standard deduction and a progressive schedule, a single worker earning $60,000 typically pays an effective state rate around 3%, not 3.99%. Lower earners pay noticeably less.

For a detailed breakdown of each tier, see Nebraska income tax brackets.

How the rate has changed

Nebraska enacted a multi-year rate reduction in 2023. The top individual rate dropped each year from 6.64% (2022) to 3.99% (2026).

The corporate rate followed a similar path. If you compare an old pay stub with a new one at the same salary, the lower Nebraska line is mostly the result of these cuts.

Other state taxes that touch your money

• Sales and use tax: 5.5% state plus local options. Groceries are generally exempt.
• Property tax: levied locally; partially offset by state property tax credits.
• Social Security benefits: fully exempt from Nebraska income tax since 2024.
• Unemployment tax: paid by employers, not deducted from your check.

Using the rate in planning

A quick rule of thumb: multiply your expected raise by your federal marginal rate, plus 7.65% FICA, plus about 3.5–4% Nebraska, to estimate how much of a raise you keep. For an exact paycheck estimate across all taxes, open the withholding guide for the state portion or the main calculator for everything at once.

Remember that rates and thresholds change. Treat any figure here as an estimate and confirm with the Nebraska Department of Revenue before filing.

Frequently asked questions

Three different answers to the same question

Ask "what is the Nebraska state tax rate?" in a break room and you will get three honest answers that do not match.

The top rate on the 2027 return is 3.99%. The lower bands are about 2.46% and 3.51%. Those are the statutory income-tax rates.

A paycheck dated in 2027 does not use that list. Circular EN withholds through a different set of steps: 2.26%, 3.22%, 3.69%, 3.81%, 3.93%, and 4.03%, after W-4N allowances come off the wage. A 2026 pay date still tops out at 4.60%.

The third answer is the one you can measure with a stub. Divide Nebraska withholding for the year by gross wages. On the example this site uses often — $60,000, single, one allowance, biweekly, nothing pre-tax, pay date in 2027 — state withholding is $73.80 a check. That is $1,918.80 a year, and $1,918.80 divided by $60,000 is 3.20%. Three point two percent of wages were prepaid. That is not 3.99%, and it is not yet the effective rate on the tax return.

Withholding share at a few salaries

The share creeps up as the wage rises, because more of the check sits in higher withholding rows and federal tax takes a bigger bite of what is left. The Nebraska column below is only the state line. Same assumptions for every row: single, one W-4N allowance, paid every two weeks, no pre-tax deductions, 2027 pay date. Figures are this calculator's estimates.

None of these rows reaches 3.99% of gross. The top statutory rate applies to taxable income past a threshold, not to the first dollar of a paycheck. FICA, at 7.65% until the Social Security wage base, is larger than the Nebraska line at every salary in the table.

Change the assumptions and the percentages move. A married couple claiming two allowances on an $80,000 wage sees a smaller state line than a single filer at the same pay. Pre-tax health insurance lowers the wage before the rate ever applies. Read the row as a picture of one common case, then use the withholding calculator for yours.

Marginal, effective, withheld

Keep the words separate or the math gets muddy.

Marginal means the statutory rate on the next dollar of Nebraska taxable income. For 2027 that is 2.46%, 3.51%, or 3.99%, depending on the band. It is the right number for "how much of this raise does the state keep?" only after you already know which band the raise falls in, and only for the state income-tax piece. Federal tax and FICA still come off too.

Effective means tax on the return divided by income. It is a look-back. You do not know it for certain until the year is closed and the deductions are real. People often use last year's 1040N as a stand-in, which is reasonable if the year ahead looks like the year behind.

Withheld means what the employer sent. It can be higher or lower than the eventual tax on purpose. A W-4N with zero allowances withholds more than one allowance. Extra dollars requested on the form withhold more still. Neither choice changes the 3.99% band.

Sales tax is a rate, and it is not this rate

The statewide sales tax is 5.5%. Omaha's combined rate is about 7%, and Lincoln's is about 7.25% once local options are included. Groceries are generally exempt from that sales tax. None of it is subtracted on a pay stub.

If you are comparing Nebraska with a state that has no income tax and a higher sales tax, you need both prices. A 3.99% top income-tax rate does not tell you the cost of a cart of groceries, and a 7% sales tax does not tell you the cost of a raise. Property tax, which Nebraska uses heavily, is a third bill. State credits can offset part of it. They still do not show up as a percentage on the paycheck.

Unemployment tax is another rate with your name nowhere on the stub. Employers pay it. The employee column for that tax is zero. Details of who pays which payroll tax are on the payroll tax guide.

What changed, and what a stub from a few years ago is hiding

The top individual rate walked down from 6.64% in 2022 to 3.99% by 2026, and 2027 keeps 3.99%. Someone comparing a 2023 stub with a 2027 stub at the same salary will usually see a smaller Nebraska line. Part of that is the rate cut. Part may be a W-4N change, a benefit change, or the inflation adjustments inside the withholding tables. Do not give the entire difference to the headline rate.

The withholding tables moved on their own calendar. The 2026 Circular EN and the 2027 Circular EN are different booklets. This calculator picks the booklet from the pay date. A check dated in December 2026 and a check dated in January 2027 can differ even when the salary did not.

Social Security benefits have been exempt from Nebraska income tax since 2024. That exemption changes the return for retirees. It does not change the 6.2% FICA line on a current worker's wage.

A raise, in one pass

Suppose the next dollar of a raise is in the top Nebraska band, the person is under the Social Security wage base, and federal withholding on that dollar is 22%. A rough keep-rate is 100% minus 22% federal, minus 7.65% FICA, minus 3.99% Nebraska, which is about 66%. Thirty-four cents of the dollar never reaches the bank, on that sketch.

The sketch breaks if the dollar is in a lower federal or Nebraska band, if Section 125 benefits or a traditional 401(k) remove it from taxable wages first, or if wages are already over the Social Security cap so the 6.2% has stopped. It also breaks if the household's real marginal federal rate is 12% or 24% rather than 22%. Use it to see why "I got a dollar and I kept a dollar" is false, then run the actual salary through the calculator before you spend the raise.

The bracket guide is where the 2.46 / 3.51 / 3.99 structure is spelled out. This page is the shorter answer: 3.99% is the top rate, most paychecks withhold less than that as a share of gross, and sales tax is a different tax entirely.

Rates that do not belong on this page

Nebraska has an inheritance tax collected at the county level. It does not touch wages, so there is no inheritance percentage in the table at the top. Federal income-tax rates are real and large, and they are not the Nebraska state tax rate. FICA is federal payroll tax. Listing them here as if they were "the state rate" is how comparison charts go wrong.

Local wage tax is the rate people move here and ask about. It is zero. No Nebraska city adds an income tax to the state rate. Omaha and Lincoln differ on sales tax and rent. They do not differ on this percentage.

Putting a stub next to the 3.99% headline

Take the Nebraska year-to-date withholding and divide by year-to-date gross. On the $60,000 example that quotient is 3.20% after a full year of identical checks. Early in the year, one unusual check — a bonus, a missed week, a benefits change — can shove the quotient around. By fall it settles. If it is sitting near 5% or near 1%, the allowance count or the filing status is doing something the headline rate cannot explain.

Then look at the marginal question separately. The top band is 3.99% of taxable income past the threshold, not 3.99% of the gross on the stub. A worker who never reaches that threshold pays about 2.46% and about 3.51% on the slices that exist, and their withholding share can land in the high 2% range, as the $40,000 row does at 2.84% of gross. Both the 2.84% and the 3.99% are "the Nebraska rate" in the mouth of someone who is not saying which question they asked.

Sales tax stays off this test. A 7% receipt in Omaha is not evidence that the income-tax rate changed. It is a different tax, paid to the register, and it will not appear in the year-to-date state-withholding box no matter how many receipts you save.