Withholding Taxes: Nebraska

Federal law and guidance on this subject should be reviewed together with this section.

Authors: Kathryn E. Jones and Meghan M. Blinn, Kutak Rock LLP

Summary

• Wages paid to Nebraska residents who work inside or outside the state are subject to withholding. An employee is a Nebraska resident for income tax purposes if certain criteria are met. Nebraska income tax must also be withheld from wages paid to Nebraska nonresident employees for services performed in the state. See Withholding on Residents, Nonresidents and Expatriates.
• An employer must use the Nebraska Form W-4N in conjunction with the Nebraska Circular EN to determine the correct Nebraska income tax withholding whenever the federal Form W-4 is completed by an employee on or after January 1, 2020. See Employee Withholding Forms.
• The withholding rate on supplemental wage payments, such as bonuses, is calculated differently depending on when the supplemental wage payments are made. See Supplemental Wages.
• Employers are required to keep records of wages paid and taxes withheld. See Recordkeeping Requirements.