By Allison Peck | North Platte Post/Sandhills Post
LINCOLN, Neb. — Governor Jim Pillen is highlighting upcoming income tax cuts set to take effect in January, marking a major step in his administration’s efforts to reform Nebraska’s tax system.
Under the plan, the state’s income tax rate will drop from 5.2% to 4.55% for the 2026 tax year. The final phase of the reduction is scheduled for 2027, when the rate will fall again to 3.99%.
“As part of the largest tax cut package in state history, my Administration is making sure Nebraskans keep more of what they earn,” said Gov. Pillen. “Our mission is simple: drive down the size and cost of government, while improving the services that taxpayers depend on. We’re making Nebraska great for families – and keeping the ‘Good Life’ open for business.”
The tax reductions stem from LB754, which Gov. Pillen signed into law in 2023. Since then, the governor has consistently opposed efforts to slow or pause the phased-in income tax cuts.
According to the administration, the changes mean Nebraska families will retain more of their income for the third consecutive year under Gov. Pillen’s leadership.
“We’ve made historic progress, but I continue to believe that our tax system needs generational reform. There’s more work to do to keep Nebraska the best place to live, build a business, and raise a family.”