Fewer Nebraskans will pay state tax on Social Security income under a new law.
Taxpayers whose adjusted gross income for 2015 is less than $58,000 per couple or $43,000 per individual will be exempt from state taxes on benefits. The law also indexes tax brackets for inflation, so taxpayers won’t end up in a higher bracket in the future simply because they receive cost-of-living increases.
AARP Nebraska had long advocated these changes. Previously, Nebraska was one of six states that taxed Social Security income to the same extent as the IRS.
Of Nebraskans age 65 and older, 46 percent rely on Social Security benefits for at least half of their family income, and 17 percent rely on those benefits for at least 90 percent of family income.