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LEGISLATURE OF NEBRASKA
ONE HUNDRED NINTH LEGISLATURE
SECOND SESSION
LEGISLATIVE BILL 846
Introduced by Dungan, 26.
Read first time January 08, 2026
Committee: Revenue
A BILL FOR AN ACT relating to revenue and taxation; to amend section1
77-2716.01, Revised Statutes Cumulative Supplement, 2024; to change2
provisions relating to individual income tax deductions; and to3
repeal the original section. 4
Be it enacted by the people of the State of Nebraska,5
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Section 1. Section 77-2716.01, Revised Statutes Cumulative1
Supplement, 2024, is amended to read: 2
77-2716.01 (1)(a) Through tax year 2017, every individual shall be3
allowed to subtract from his or her income tax liability an amount for4
personal exemptions. The amount allowed to be subtracted shall be the5
credit amount for the year as provided in this subdivision multiplied by6
the number of exemptions allowed on the federal return. For tax year7
1993, the credit amount shall be sixty-five dollars; for tax year 1994,8
the credit amount shall be sixty-nine dollars; for tax year 1995, the9
credit amount shall be sixty-nine dollars; for tax year 1996, the credit10
amount shall be seventy-two dollars; for tax year 1997, the credit amount11
shall be eighty-six dollars; for tax year 1998, the credit amount shall12
be eighty-eight dollars; for tax year 1999, and each year thereafter13
through tax year 2017, the credit amount shall be adjusted for inflation14
by the method provided in section 151 of the Internal Revenue Code of15
1986, as it existed prior to December 22, 2017. The eighty-eight-dollar16
credit amount shall be adjusted for cumulative inflation since 1998. If17
any credit amount is not an even dollar amount, the amount shall be18
rounded to the nearest dollar. For nonresident individuals and partial-19
year resident individuals, the personal exemption credit shall be20
subtracted as specified in subsection (3) of section 77-2715.21
(b) Beginning with tax year 2018, every individual, except an22
individual that can be claimed for a child credit or dependent credit on23
the federal return of another taxpayer, shall be allowed to subtract from24
his or her income tax liability an amount for personal exemptions. The25
amount allowed to be subtracted shall be the credit amount for the year26
as provided in this subdivision multiplied by the sum of the number of27
child credits and dependent credits taken on the federal return, plus two28
for a married filing jointly return or plus one for any other return. For29
tax year 2018, the credit amount shall be one hundred thirty-four30
dollars. For tax year 2019 and each tax year thereafter, the credit31
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amount shall be adjusted for inflation based on the percentage change in1
the Consumer Price Index for All Urban Consumers published by the federal2
Bureau of Labor Statistics from the twelve months ending on August 31,3
2017, to the twelve months ending on August 31 of the year preceding the4
taxable year. If any credit amount is not an even dollar amount, the5
amount shall be rounded to the nearest dollar. For nonresident6
individuals and partial-year resident individuals, the personal exemption7
credit shall be subtracted as specified in subsection (3) of section8
77-2715. 9
(2)(a) For tax years beginning or deemed to begin on or after10
January 1, 2003, and before January 1, 2004, under the Internal Revenue11
Code of 1986, as amended, every individual who did not itemize deductions12
on his or her federal return shall be allowed to subtract from federal13
adjusted gross income a standard deduction based on the filing status14
used on the federal return except as the amount is adjusted under section15
77-2716.03. The standard deduction shall be the smaller of the federal16
standard deduction actually allowed or (i) for single taxpayers four17
thousand seven hundred fifty dollars, (ii) for head of household18
taxpayers seven thousand dollars, (iii) for married filing jointly19
taxpayers seven thousand nine hundred fifty dollars, and (iv) for married20
filing separately taxpayers three thousand nine hundred seventy-five21
dollars. Taxpayers who are allowed additional federal standard deduction22
amounts because of age or blindness shall be allowed an increase in the23
Nebraska standard deduction for each additional amount allowed on the24
federal return. The additional amounts shall be for married taxpayers,25
nine hundred fifty dollars, and for single or head of household26
taxpayers, one thousand one hundred fifty dollars.27
(b) For tax years beginning or deemed to begin on or after January28
1, 2007, and before January 1, 2018, under the Internal Revenue Code of29
1986, as amended, every individual who did not itemize deductions on his30
or her federal return shall be allowed to subtract from federal adjusted31
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gross income a standard deduction based on the filing status used on the1
federal return. The standard deduction shall be the smaller of the2
federal standard deduction actually allowed or (i) for single taxpayers3
three thousand dollars and (ii) for head of household taxpayers four4
thousand four hundred dollars. The standard deduction for married filing5
jointly taxpayers shall be double the standard deduction for single6
taxpayers, and for married filing separately taxpayers, the standard7
deduction shall be the same as single taxpayers. Taxpayers who are8
allowed additional federal standard deduction amounts because of age or9
blindness shall be allowed an increase in the Nebraska standard deduction10
for each additional amount allowed on the federal return. The additional11
amounts shall be for married taxpayers six hundred dollars and for single12
or head of household taxpayers seven hundred fifty dollars. The amounts13
in this subdivision will be indexed using 1987 as the base year.14
(c) For tax years beginning or deemed to begin on or after January15
1, 2007, and before January 1, 2018, the standard deduction amounts,16
including the additional standard deduction amounts, in this subsection17
shall be adjusted for inflation by the method provided in section 151 of18
the Internal Revenue Code of 1986, as it existed prior to December 22,19
2017. If any amount is not a multiple of fifty dollars, the amount shall20
be rounded to the next lowest multiple of fifty dollars.21
(3)(a) For tax years beginning or deemed to begin on or after22
January 1, 2018, every individual who did not itemize deductions on his23
or her federal return shall be allowed to subtract from federal adjusted24
gross income a standard deduction based on the filing status used on the25
federal return. The standard deduction shall be the smaller of the26
federal standard deduction actually allowed or (i) six thousand seven27
hundred fifty dollars for single taxpayers and (ii) nine thousand nine28
hundred dollars for head of household taxpayers. The standard deduction29
for married filing jointly taxpayers or qualifying widows or widowers30
shall be double the standard deduction for single taxpayers, and the31
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standard deduction for married filing separately taxpayers shall be the1
same as the standard deduction for single taxpayers. Taxpayers who are2
allowed additional federal standard deduction amounts because of age or3
blindness shall be allowed an increase in the Nebraska standard deduction4
for each additional amount allowed on the federal return. The additional5
amounts shall be one thousand three hundred dollars for married taxpayers6
and one thousand six hundred dollars for single or head of household7
taxpayers. 8
(b) For tax years beginning or deemed to begin on or after January9
1, 2019, the standard deduction amounts, including the additional10
standard deduction amounts, in this subsection shall be adjusted for11
inflation based on the percentage change in the Consumer Price Index for12
All Urban Consumers published by the federal Bureau of Labor Statistics13
from the twelve months ending on August 31, 2017, to the twelve months14
ending on August 31 of the year preceding the taxable year. If any amount15
is not a multiple of fifty dollars, the amount shall be rounded to the16
next lowest multiple of fifty dollars. 17
(4)(a) For taxable years beginning or deemed to begin before January18
1, 2026, every (4) Every individual who itemized deductions on his or her19
federal return shall be allowed to subtract from federal adjusted gross20
income the greater of either the standard deduction allowed in this21
section or his or her federal itemized deductions as defined in section22
63(d) of the Internal Revenue Code of 1986, as amended, except for the23
amount for state or local income taxes included in federal itemized24
deductions before any federal disallowance. 25
(b) For taxable years beginning or deemed to begin on or after26
January 1, 2026, every individual who itemized deductions on his or her27
federal return shall be allowed to subtract from federal adjusted gross28
income the greater of either the standard deduction allowed in this29
section or his or her federal itemized deductions as defined in section30
63(d) of the Internal Revenue Code of 1986, as amended, except for the31
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amount for state or local income taxes included in federal itemized1
deductions not exceeding the applicable limitation amount set for taxable2
years beginning after calendar year 2029 under section 164(b)(7) of the3
Internal Revenue Code of 1986, as such section existed on January 1,4
2026. 5
Sec. 2. Original section 77-2716.01, Revised Statutes Cumulative6
Supplement, 2024, is repealed. 7
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