Nebraska return changes for 2025 and 2026

The DOR rate chronology shows the individual top rate at 5.20% for 2025, down from 5.84% for 2024, and 4.55% for 2026. The corporate rate is a single 5.20% for 2025 and 4.55% for 2026, replacing the two-step 2024 schedule.

Nebraska follows the Internal Revenue Code on a rolling basis. In its September 2025 report the DOR said the tips, overtime and car loan interest deductions are taken after federal AGI, so they have no automatic effect on Nebraska individual receipts.

The business expensing changes (permanent 100% bonus depreciation, domestic research expensing and the higher section 179 limits) do flow through, which the DOR expects to lower Nebraska tax for owners of pass-through businesses.

LB 647 confirms that the pass-through entity tax election can be made on the entity’s return, on or before its due date including extensions, for tax years beginning on or after January 1, 2023. The DOR describes this as codifying its existing process.

• Direct support professionals may get a $500 refundable credit from 2025, with DOR approval first.
• The Relocation Incentive Act gives employers the lesser of 50% of relocation costs or $5,000 per qualified employee.
• A one-time election lets new residents exclude Nebraska wages in the $70,000 to $250,000 range for 2025.
• An adoption credit equal to 10% of the federal credit starts with tax years beginning in 2026.
• The food bank donation credit ends for tax years beginning on or after January 1, 2026.