Complete Guide to Nebraska LLC Taxes in 2025
Nebraska has undergone significant tax reform, reducing its income tax brackets to 2.46-5.84% for 2024 and beyond. The Cornhusker State charges just $13 for a biennial report (every two years), making ongoing compliance remarkably affordable. With no entity-level tax on pass-through LLCs, Nebraska offers a straightforward and increasingly competitive tax environment for LLC owners.
How Nebraska Taxes LLCs
Nebraska treats LLCs as pass-through entities for state tax purposes. The LLC itself does not pay Nebraska income tax. Instead, profits pass through to individual members who report their share on their personal Nebraska income tax returns (Form 1040N).
For a single-member LLC, income flows to Schedule C of the federal return and then to Nebraska Form 1040N. For a multi-member LLC, the LLC files Nebraska Form 1065N (Partnership Return) as an informational return.
Nebraska does not impose a franchise tax, entity-level tax, or gross receipts tax on LLCs. The 2024 tax reform significantly reduced rates from the previous top bracket of 6.84%, making Nebraska more competitive with neighboring states.
Key Point: Nebraska's 2024 tax reform reduced the top rate from 6.84% to 5.84% and lowered all bracket rates. The biennial report fee of just $13 (filed every two years) makes Nebraska one of the most affordable states for ongoing LLC maintenance.
Nebraska Income Tax Brackets (2025, Post-Reform)
| Taxable Income (Single) | Rate | MFJ Threshold |
|---|---|---|
| $0 - $3,700 | 2.46% | $0 - $7,390 |
| $3,701 - $22,170 | 3.51% | $7,391 - $44,350 |
| $22,171 - $35,730 | 5.01% | $44,351 - $71,500 |
| Over $35,730 | 5.84% | Over $71,500 |
Nebraska LLC Annual Filing Requirements
- Biennial Report: $13 fee, filed every two years with the Secretary of State (due odd or even years depending on formation)
- State Tax Returns: Form 1040N (individual) or Form 1065N (partnership)
- Estimated Tax Payments: Required if expecting to owe $500 or more
- Sales Tax Filing: File with the Department of Revenue if selling taxable goods
Nebraska Sales Tax
Nebraska imposes a 5.50% state sales tax with local additions up to about 2%, bringing combined rates to approximately 7.50% in some areas:
- State rate: 5.50%
- Omaha: Combined approximately 7.00%
- Lincoln: Combined approximately 7.25%
- Food: Grocery items are exempt from sales tax
- Services: Most services are not taxable
Nebraska LLC vs. Other States
| State | Income Tax | Annual Fee | Key Feature |
|---|---|---|---|
| Nebraska | 2.46-5.84% | $13 biennial | Recently reformed, very low annual cost |
| Iowa | 4.40-5.70% | $30 biennial | Also recently reformed |
| Kansas | 3.10-5.70% | $55 | Annual report required |
| Colorado | 4.40% flat | $10 | Low flat rate, cheap annual report |
| South Dakota | 0% | $50 | No income tax |
| Wyoming | 0% | $60 | No income tax |
Nebraska LLC Formation Costs
- Certificate of Organization: $105 with the Secretary of State ($110 by mail)
- Registered Agent: Required; member or professional service
- EIN: Free from the IRS
- Biennial Report: $13 every two years
Nebraska Tax Deductions
- Standard deduction: $7,700 single, $15,400 MFJ (2025)
- Half of SE tax: Deductible
- Health insurance: Self-employed deduction allowed
- Retirement contributions: Fully deductible
- Section 179: Nebraska conforms to federal limits
Common Nebraska LLC Tax Mistakes
- Using old tax rates: The 2024 reform significantly changed brackets; ensure you use current rates
- Missing biennial report: It is only due every two years, but missing it can lead to administrative dissolution
- Underestimating local sales tax: Combined rates vary significantly by jurisdiction
- Not planning for the 5.84% top bracket: Kicks in at just $35,730 for single filers
Nebraska Resources
- Nebraska Department of Revenue: revenue.nebraska.gov
- Secretary of State: sos.nebraska.gov
- Revenue Customer Service: (402) 471-5729