Nebraska Tax Relief Programs

Nebraska taxpayers have access to programs designed to lower property tax bills, reduce state income tax, and refund property taxes paid in prior years. In 2024 alone, Nebraska distributed over $400 million in property tax relief, helping thousands of homeowners, farmers, and businesses offset rising tax bills. These programs are part of the state’s effort to keep property taxes affordable and simplify how taxpayers receive credits.

Understanding Nebraska tax relief programs is key to getting the most out of the benefits available to you. Several opportunities exist to lower what you owe from the Homestead Exemption for seniors and veterans to school district property tax credits and recent income tax rate reductions. Some credits automatically apply to your tax bill, while others require you to file a claim or include them on your state income tax return.

This article breaks down the main Nebraska tax relief programs for 2024 and 2025, explains who qualifies, and shows how to claim your credits. You will also learn the consequences of missing deadlines, options for resolving unpaid taxes, and how to get professional help from state resources. By the end, you will know which programs to use and how to apply for them before the next tax year begins.

What Is the Nebraska Tax Relief Program?

Nebraska tax relief programs are a group of state-administered benefits designed to lower the overall tax burden for residents. These programs focus primarily on property tax credits, income tax reductions, and targeted exemptions for specific groups such as seniors, veterans, and people with disabilities. The goal is to offset rising property taxes and ensure taxpayers can keep more of their income while funding essential public services.

The Nebraska Department of Revenue and local county assessor offices work together to make these programs available each year. Some are applied automatically, like the statewide real property tax credit and the school district property tax credit that began appearing directly on tax statements in 2024. Others require an application or filing, such as the Homestead Exemption (filed with Form 458) or refundable income tax credits for property taxes paid in prior years.

Legislation passed in 2023 and 2024 created new credits and restructured how relief is provided. For example, the school district credit moved from a refundable income tax credit to an upfront credit applied directly to property tax bills. Nebraska also began phasing in lower individual income tax rates, with additional changes scheduled through 2025 and beyond.

These programs give taxpayers multiple ways to reduce property and income tax obligations. Knowing which credits apply to your situation—and whether you must file to claim them—is essential to avoid missing out on available savings.

Why Did You Receive a Tax Credit or Notice?

Taxpayers often see new credits or messages from the state and county offices on their property tax statements. Here are the most common reasons you might receive one:

• The school district property tax credit appears on your bill: Starting in 2024, Nebraska automatically applies a percentage of school property taxes paid as a credit on your current property tax statement.
  
  
• Real property tax credit reduces your total due: This statewide credit is funded by Nebraska’s property tax credit cash fund and is distributed each year directly to county treasurers to lower tax bills for property owners.
  
  
• Homestead exemption confirmation arrives by mail: If you filed Form 458 and qualified, you may receive a notice confirming that your home’s taxable value has been reduced.
  
  
• A refundable income tax credit eligibility notice has been sent: Some taxpayers are reminded to claim credits for property taxes paid in previous years by filing or amending a state income tax return.
  
  
• Adjustment notices are issued after reappraisal: If your property was reassessed or damaged, you may get a new statement showing a lower taxable value and adjusted taxes owed.

Consequences of Ignoring Nebraska Tax Relief Opportunities

Not taking advantage of Nebraska tax relief programs can be costly. Each consequence has a direct financial or legal impact that taxpayers should consider:

• You would pay more property tax than necessary: Skipping exemptions or credits leads to higher bills, sometimes by hundreds of dollars annually.
  
  
• You could lose eligibility for the current tax year: Programs such as the Homestead Exemption require annual filing, and missing the deadline means you cannot benefit until the following year.
  
  
• You may forfeit refundable credits from prior years: The Nebraska Department of Revenue allows only a limited time to claim credits for property taxes paid, so waiting too long can permanently eliminate your refund.
  
  
• You might face penalties and interest on unpaid balances: Counties add fees to delinquent accounts, which can increase your total amount owed.
  
  
• You could miss valuable income tax savings: Social Security exemptions and lower income tax rates only help if you file correctly and report income accurately.

Relief and Resolution Options for Property and Income Taxes

Nebraska offers several ways to lower both property taxes and state income taxes. Understanding these programs helps taxpayers file correctly and avoid missing valuable credits.

Property Tax Relief Programs

• Homestead Exemption: This program reduces the taxable value of a home for qualifying seniors, disabled individuals, and veterans. You must file Form 458 with your county assessor annually to keep receiving the benefit.
  
  
• School District Property Tax Credit: Beginning in 2024, this credit is automatically applied to property tax bills. Taxpayers do not need to file any additional forms to receive it.
  
  
• Community College Property Tax Credit: This refundable credit applies to community college property taxes paid before the funding shift in 2024. If eligible, taxpayers can still claim this credit on prior-year state income tax returns.
  
  
• Special Valuation for Agricultural Land: This program assesses agricultural or horticultural land near development pressure at its use value. It helps farmers and landowners avoid inflated property taxes caused by non-agricultural market prices.

Income Tax Relief Options

• Social Security Exemption: Nebraska fully exempts Social Security benefits from state income tax starting with the 2025 tax year. This change lowers taxable income for many retirees.
  
  
• Lower Income Tax Rates: Nebraska is phasing in lower individual income tax rates through 2027. As rates decrease, taxpayers will see reduced liability each year.
  
  
• Nebraska National Guard Pay Exclusion: Starting in 2025, qualifying National Guard pay can be excluded from Nebraska taxable income. This provides additional relief for service members.

How to Respond to the Notice or Claim Your Credit

When you receive a notice or see a credit on your property tax bill, you must act quickly to confirm eligibility or file any required forms. Here are the key steps to follow:

• Review your property tax statement carefully. Confirm that the school district property tax credit and the statewide real property tax credit have been applied correctly.
  
  
• File Form 458 for the Homestead Exemption. Submit this form to your county assessor during the filing window (usually February through June) to reduce your home’s taxable value.
  
  
• Use the Department of Revenue’s lookup tool. This online service helps you verify property taxes paid in prior years to claim any refundable credits you are eligible for.
  
  
• Claim credits on your state income tax return. If you qualify for refundable credits for past school district or community college taxes, include them on your current or amended return.
  
  
• Submit Form 425 if your property was damaged. This form ensures your property value is reassessed for the current year, lowering your tax bill.
  
  
• Keep copies of all forms and correspondence. This documentation protects you in case of disputes or follow-up questions from the county or state.

Consider setting up a payment plan with your county treasurer for taxpayers who cannot pay their full balance. 

Professional Help and Resources

Nebraska taxpayers do not have to navigate property tax credits or income tax changes alone. The Nebraska Department of Revenue website provides detailed guidance, and county assessor offices can confirm local filing deadlines for exemptions and credits. Free taxpayer assistance programs are also available for low-income residents who need help completing forms.

Ordering your IRS account transcript is one of the most effective steps for those who want a clear picture of their tax history before filing. An IRS transcript shows prior-year tax payments, credits, and adjustments in one place, making it easier to confirm you are claiming everything you are entitled to.

Our IRS Account Transcript Service retrieves your full transcript and gives you a plain-English summary of your tax history. This helps you find missed property tax credits, confirm income reporting, and prepare accurate returns for 2024–2025.

FAQs

Who qualifies for the Nebraska Homestead Exemption?

The Nebraska Homestead Exemption is available to homeowners 65 or older, specific disabled individuals, and qualifying veterans or surviving spouses. Applicants must meet the state's income and home value limits each year. You must file Form 458 with your county assessor between February and June annually to receive the exemption for that tax year.

Can I still claim property taxes paid in 2023 or 2024?

Many taxpayers can still claim refundable credits for school district or community college property taxes paid in 2023 or early 2024. You must file or amend your Nebraska income tax return to receive the credit. The Nebraska Department of Revenue offers a lookup tool to verify your property taxes paid before you claim the credit on your return.

How do I apply for a property tax refund if my home was damaged?

If your property was significantly damaged between January 1 and July 1, you can request a reassessment for that tax year. File Form 425 with your county assessor by the mid-July deadline. This ensures your property value is adjusted based on the damage and lowers your tax bill accordingly. Keep copies of your filing and assessor’s decision for your records.

What happens if I do not file for my exemption on time?

If you miss the filing deadline for programs like the Homestead Exemption, you will lose eligibility for that year’s tax relief. You must wait until the next filing window to reapply. Missing the deadline could increase property taxes by several hundred dollars, so filing on time each year is essential.

Are Nebraska income tax rates changing in 2025?

Yes, Nebraska continues to phase in lower income tax rates through 2027. For 2025, the top individual rate will continue its scheduled step-down, with the long-term goal of reaching 3.99 percent by 2027. These reductions mean taxpayers may owe less each year, but they still must file accurately to benefit from the lower rates.

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