Nebraska business tax refers to the state's specific laws for company taxes. Each business structure has particular tax laws. The legal entity of the company determines tax details. Under the Corporation Occupation Tax, Nebraska has both a corporate income tax and a franchise tax, which applies to traditional corporations and S corporations.

Nebraska Business Income Tax

Most states collect at least some types of business income earned locally. The business' legal form plays a significant role in determining the details of revenue tax. Generally, corporate income taxes apply to corporations. Both the federal and state government enforces corporate taxes on business profits. Corporations are usually taxed at a flat rate, regardless of income. A flat rate is a system in which every individual or corporation in that group pays the same tax rate regardless of income. Corporate tax rates vary from state to state but typically range from 4 to 10 percent.

Pass-through entities do not pay corporate income taxes. Owners are taxed directly on income, factoring their share of profits and losses. These entities include S corporations, limited liability companies, partnerships, and sole proprietorships. Personal income rates vary according to individual income and range from 0 to 9 percent. Franchise tax, or privilege tax, refers to the taxing of a company for doing business in the state. Franchise taxes are dependent on the type of business structure and can be either an amount based on the company's net worth or a flat fee.

Nebraska incorporates both a corporate income tax and a franchise tax, referred to as the corporation occupation tax. Businesses may be required to pay both, one, or neither of these taxes based on their type of business structure. Personal income taxes apply to pass-through entities in Nebraska, as well. The corporation occupation tax affects both traditional and S corporations and pays taxes every two years based on the business's net worth.

Fee amounts vary, depending on the sum of paid-up capital stock in the corporation. The tax rate fluctuates corresponding to the amount of money that a company received from its investors or shareholders in exchange for shares of stock. Graduated tax, or varying tax rates, means the more money a company received, the more taxes they must pay.

  • Paid-up capital stock < or equal to $10,000
    • Fees start at $26
  • Paid-up capital stock > $100 million
    • Fees up to $23,990 or more

Nebraska traditional corporations have two different income rates:

  • Taxable income < or equal to $100,000 are taxed at 5.58 percent
  • Taxable income > $100,000 are taxed at a rate of 7.81 percent

Personal income rates range from 2.46 to 6.84 percent in the state of Nebraska.

  • $0-2,400 — 2.56 percent
  • $2,400-17,500 — 3.57 percent
  • $17,500-27,000 — 5.12 percent
  • $27,000+ — 6.84 percent

Tax Return Deadline

In Nebraska, corporate income tax returns are due on March 15. However, extensions are available through the Nebraska Tax Extension.

  • Granted a seven-month extension, due on October 15 of the same calendar year.
  • To request an extension, file Nebraska Form 7004N prior to the official March 15 deadline.
  • Even when the state grants an extension, the business is required to pay Nebraska state tax by March 15th to avoid fees and interest costs.

Nebraska Business Tax: 5 Types of Corporations

Business is taxed based on its legal form. In the state of Nebraska, the primary business structures include:


  • A legal entity that is separate and distinct from its owners
  • Pay federal and state corporate income taxes
  • Must pay the corporation occupation tax
  • File Tax Form 1120N

S Corporations

  • Pass-through entity
  • Exempt from federal and state corporate income taxes
  • Must pay the corporation occupation tax
  • Each shareholder pays personal income tax on their profits from the company
  • File Tax Form 1120-SN

Limited Liability Company

  • Pass-through entity
  • Does not have to pay federal or state corporate income taxes
  • Exempt from Nebraska's corporation occupation tax
  • Income from the business passes through to individual members of the LLC
  • Members pay federal and state personal income taxes based on their earned profits.
  • Tax rates depend on individual taxable income


  • In Nebraska, organizations do not have to pay the state's corporation occupation tax or business income tax.
  • The same with other pass-through entities, the partners are required to pay federal and state personal income taxes based on profits.
  • File Tax Form 1065N

Sole Proprietorship

  • Only the owner of the company is subject to pay tax on income from their business on their personal federal and state tax returns.
  • Exempt from corporation occupation tax and corporate income tax
  • File Tax Form 1040N

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