Nebraska LLC Taxes: The Complete Filing Guide (2025)

Nebraska LLC Tax Basics

Navigating your Nebraska LLC tax obligations doesn’t have to be complicated. We’ll walk you through the essentials of pass-through taxation, explain Nebraska’s specific requirements, and highlight strategies to stay compliant and organized. This guide covers everything from federal income taxes to city-specific requirements and filing deadlines.

Use the links below to jump directly to the section you need:

• Nebraska LLC Taxes at a Glance
• Understanding LLC Taxation Basics
• Federal Tax Obligations
• Nebraska State Taxes
• Local Tax Considerations
• Tax Calendar and Filing Tips
• Tax Strategies for Nebraska LLCs
• Forms and Resources

Nebraska LLC Taxes at a Glance

Tax Type	Rate	Filing Deadline	Forms Required
Federal Income Tax	10-37% (personal brackets)	April 15, 2025	Form 1040 + Schedule C or Schedule E/K-1
Self-Employment Tax	15.3%	April 15, 2025	Schedule SE
Nebraska Individual Income Tax	2.46%–5.84%	April 15, 2025	Form 1040N
Nebraska Corporate Income Tax	5.58% for first $100,000 (5.84% on anything over $100K)	April 15, 2025	Form 1120N
Federal Payroll Taxes (If Employees)	7.65% employer + 7.65% employee (FICA)	Quarterly (April 30, July 31, October 31, January 31)	Form 941
Nebraska Unemployment Insurance Tax (If Employees)	0.0%–5.4% (new employers: 1.25%)	Quarterly	UI Form 1 (File via NEworks)
Federal Unemployment (FUTA)	6% on first $7,000 per employee (0.6% after credits)	January 31, 2026 (annual)	Form 940
Nebraska State and Local Sales and Use Tax	5.5% state rate (local surtaxes may increase the total to 7.5%)	Monthly, quarterly, or annually based on volume	Form 10 (filed online)
Nebraska Pass-Through Entity Tax	5.84% (set to reduce to 5.20% next year)	April 15, 2025	Form PTET-E
Biennial Report	$25 fee (+ $3 processing surcharge)	April 1 (every odd-numbered year)	Nebraska Biennial Report Form (online or mail)

Understanding LLC Taxation Basics

How Nebraska LLCs Are Taxed By Default

Your Nebraska LLC doesn’t pay taxes itself. Instead, profits flow through to you and your members, who report them on personal tax returns. This is called pass-through taxation.

Here’s how it works:

1. Your LLC earns income from business activities
2. The LLC itself files no tax return (unless you elect otherwise)
3. Profits “pass through” to members based on ownership percentage
4. Each member reports their share on their personal tax return
5. Members pay tax at their individual income tax rates

What this means for you: Unlike corporations, your business profits are only taxed once, which typically saves money.

Tax Classification Options

While pass-through taxation is the default, your Nebraska LLC can choose alternative tax treatments:

Default LLC Tax Status:

• Single-member LLC: Taxed as a sole proprietorship
• Multi-member LLC: Taxed as a partnership

Optional Tax Classifications:

• S Corporation: Can reduce self-employment taxes by paying “reasonable salaries”
• C Corporation: LLC pays corporate tax on profits, members pay personal tax on distributions (creates double taxation)

Nebraska Pass-Through Entity Tax Option:

• Optional tax that allows LLCs taxed as partnerships or S Corps to pay tax at the entity level
• Can help overcome the $10,000 SALT deduction limitation
• Election is made annually and cannot be changed once filed for that tax year

Not sure which tax classification is right for your business? Schedule a free consultation with 1-800Accountant.

Federal Tax Obligations

Income Tax

As a Nebraska LLC owner, you’ll report your share of business profits on your personal tax return using:

• Form 1040 + Schedule C (single-member LLCs)
• Form 1040 + Schedule E + Schedule K-1 (multi-member LLCs)

Federal income tax rates range from 10% to 37% based on your tax bracket (actual brackets will depend on inflation adjustments and any tax law changes).

Simply Put: Whatever money your business makes (after expenses) gets added to your personal tax return, just like income from a job.

Self-Employment Tax

LLC members actively involved in the business must pay self-employment tax of 15.3% (covering Social Security and Medicare) on their share of LLC profits.

Key points:

• Applies to net earnings of $400 or more
• Calculated on Schedule SE
• You can deduct 50% of the self-employment tax as an “above-the-line” deduction, which lowers your adjusted gross income

What happens if I miss this payment? The IRS charges penalties of 0.5% per month plus interest. However, first-time mistakes can often qualify for penalty abatement if you have a clean compliance history.

Employment Taxes

If your LLC has employees, you must:

• Withhold federal income tax
• Pay and withhold FICA taxes (7.65% each for employer and employee)
• Pay federal unemployment tax (FUTA)
• File quarterly employment tax returns (Form 941)
• Provide W-2 forms annually

Estimated completion time: 2-3 hours per quarter (significantly less with payroll software or professional help)

Estimated Tax Payments

Because no tax is withheld from your LLC profits, you’ll likely need to make quarterly estimated tax payments using Form 1040-ES. These payments cover both income and self-employment taxes on your share of the business income. Missing deadlines or underpaying can lead to IRS penalties, even if you pay in full later.

Working with an accountant can help ensure accurate calculations, on-time payments, and a smarter overall tax strategy.

Key deadlines:

• April 15
• June 16
• September 15
• January 15

Pro Tip: Set calendar reminders 15 days before each deadline. This gives you time to prepare without the last-minute rush that leads to mistakes.

Nebraska State Taxes

Nebraska Income Tax

Nebraska has a graduated personal income tax rate of 2.46% to 5.84% that applies to your LLC’s profits on your personal return.

Filing requirements:

• Use Nebraska Form 1040N
• Due April 15, 2025
• Nebraska starts with your federal adjusted gross income as a baseline

Bottom Line: For every $1,000 your LLC earns, you’ll pay somewhere between $25 and $58 in Nebraska state income tax (in addition to federal taxes).

Nebraska Pass-Through Entity Tax

This optional tax can benefit many Nebraska LLC owners:

• Tax rate: 5.84% (scheduled to decrease to 5.20% next year)
• Paid by your LLC instead of individual members
• Members receive a refundable credit on their personal Nebraska returns
• Helps bypass the $10,000 federal SALT deduction cap
• Elect by filing Form PTET-E with your LLC’s Nebraska income tax return by April 15
• Election is annual and cannot be changed once made for the year

Real Savings Example: For an LLC with $200,000 in profits, electing PTET could save members thousands in federal taxes by allowing the full state tax to be deducted at the entity level.

Nebraska Corporate Income Tax

If your LLC elects to be taxed as a C corporation, it must pay Nebraska’s corporate income tax directly (separate from your personal tax return).

• Due April 15, 2025
• Rate is 5.58% on the first $100,000 of taxable income
• Rate increases to 5.84% on income over $100,000
• Filed using Nebraska Form 1120N
• Paid directly by the LLC through the Nebraska e-file system

Sales and Use Tax

If your Nebraska LLC sells physical products or certain services, you’ll need to:

• Collect 5.5% sales tax (plus any applicable local surcharges)
• Register for a sales tax permit through the Nebraska Department of Revenue
• File and pay collected taxes monthly, quarterly, or annually based on sales volume

60-Second Check: Do I Need to Collect Sales Tax?

• Do you sell physical products in Nebraska? → If yes, collect tax
• Do you sell digital products? → Generally taxable (SaaS products are an exception)
• Do you provide services? → Many services are taxable (see exceptions below)
• Do you sell online to Nebraska customers? → If yes, collect tax

Services typically exempt from sales tax include:

• Professional services (legal, accounting)
• Personal services (haircuts, fitness training)
• Medical services

Products typically subject to sales tax include:

• Tangible personal property
• Prepared food
• Some digital products

Payroll Taxes 

If you have employees in Nebraska, you will be responsible for two types of payroll taxes. 

Unemployment Insurance (UI) Tax 

• Register through the Nebraska Department of Labor 
• Rate is 1.25% for new non-construction employers (0.0%–5.4% afterwards, based on your payroll and claims history)
• Due quarterly

Withholding Tax 

• Register through the Nebraska Department of Revenue (Form 20)
• Withhold based on employee W-4N and IRS W-4 elections
• Due monthly, quarterly, or annually, depending on your LLC’s total withholding liability

Biennial Report Filing

While not a tax, your Nebraska LLC must file a biennial report to stay in good standing with the state.

• Due April 1 of every odd-numbered year
• $25 filing fee (plus $3 online processing fee)
• Filed with the Nebraska Secretary of State
• Administrative dissolution begins if not filed by June 1

Calendar Alert: Set a reminder for March 1 to ensure you don’t miss this easy but required filing.

Local Tax Considerations

City Sales and Use Taxes

Nebraska allows cities and counties to impose local sales taxes on top of the state’s 5.5% rate.

Cities with local sales taxes (state and local rate combined) include:

• Lincoln (7.25%) 
• Omaha (7.0%) 
• Grand Island (7.5%)
• Bellevue (7.0%)
• Crete (7.5%)
• Beatrice (7.5%)
• Gretna (7.5%)
• York (7.5%) 

You can see the Nebraska Sales and Use Tax Rate Chart to find the current rate for each city and county.

Filing requirements:

• All local sales taxes are administered by the state (there is no separate filing at the city level)
• Filing frequency is monthly, quarterly, or annually (depending on your total taxable sales)
• Filing schedule is assigned by the Nebraska Department of Revenue

Property Taxes

If your LLC owns real property in Nebraska:

• Rates vary by locality
• Assessed annually
• May qualify for various exemptions based on business type
• Personal property tax may apply to business equipment

Tax Calendar and Filing Tips

Key Deadlines for Nebraska LLCs

January:

• January 15: Final estimated tax payment for previous year
• January 31: Nebraska UI tax due (quarterly)
• January 31: Issue W-2s/1099s to employees/contractors
• January 31: Fourth quarter federal payroll tax payment due 

April:

• April 1: Nebraska Biennial Report due (odd-numbered years only)
• April 15: Federal income and self-employment tax returns due

• April 15: First quarter estimated tax payment due 
• April 15: Nebraska income tax returns and PTET election due
• April 30: First quarter federal payroll tax payment due
• April 30: First quarter Nebraska UI tax due

June: 

• June 16: Second quarter estimated tax due 

July: 

• July 31: Second quarter Nebraska UI tax due
• July 31: Second quarter federal payroll tax payment due 

September:

• September 15: Third quarter estimated tax payment due

October:

• October 31: Third quarter Nebraska UI tax due
• October 31: Third quarter federal payroll tax payment due

Record-Keeping Checklist

Keep these records for at least 7 years:

• Business income records (invoices, receipts)
• Expense receipts and documentation
• Bank and credit card statements
• Asset purchase and improvement records
• Vehicle mileage logs
• Home office documentation
• Payroll records
• Previous tax returns

Tax Strategies for Nebraska LLCs

S Corporation Election Benefits

Converting your LLC to an S Corporation for tax purposes can save on self-employment taxes:

1. File Form 2553 with the IRS
2. Pay yourself a “reasonable salary” subject to employment taxes
3. Take remaining profits as distributions exempt from self-employment tax

Example: An LLC making $100,000 in profit pays 15.3% self-employment tax on the entire amount. As an S Corp, if $60,000 is a reasonable salary and $40,000 is taken as distributions, only the $60,000 is subject to employment taxes.

Potential Savings: In this example, you’d save about $6,120 in self-employment taxes.

Pass-Through Entity Tax Election

Consider electing Nebraska’s Pass-Through Entity Tax if:

• You’re affected by the $10,000 SALT deduction cap
• Your LLC has significant pass-through income
• All members agree to the election

Business Expense Deductions

Common deductions Nebraska LLC owners often overlook:

• Home office deduction
• Business mileage (70¢ per mile for 2025)
• Health insurance premiums
• Retirement plan contributions
• Professional development expenses
• Business meals (50% deductible)

Forms and Resources

Federal Tax Forms

• Schedule C: Profit or Loss From Business (sole proprietors)
• Form 1065: U.S. Return of Partnership Income
• Schedule K-1: Partner’s Share of Income, Deductions, Credits
• Form 1120-S: U.S. Income Tax Return for an S Corporation
• Form 2553: Election by a Small Business Corporation (S Corp)
• Form 8832: Entity Classification Election

Nebraska Tax Forms

• Form 1040N: Nebraska Individual Income Tax Return
• Form PTET-E: Nebraska Pass-Through Entity Tax Return
• Form 1120N: Nebraska Corporate Income Tax Return

Helpful Resources

• Nebraska Department of Revenue
• Nebraska Department of Labor
• Nebraska Secretary of State
• Internal Revenue Service