As 2025 approaches, several legislative changes in Nebraska are set to impact businesses and individuals alike. Understanding and preparing for these changes now can help your organization maximize benefits while ensuring compliance. Here are the key updates and their potential impacts on your operations: 

1. Relocation Incentive Act

Employers who pay to relocate employees to Nebraska will now be eligible for a $5,000 tax credit when certain conditions are met, including salary requirements between $70,000 and $250,000. Additionally, qualifying relocated employees may have their wages excluded from state income tax. This creates a dual benefit: 

• Employers can offset recruitment costs while addressing workforce needs
• Relocated employees benefit from immediate tax savings on their wages 
  

2. Full Expensing for Qualified Property and Research Expenditures

Under LB 1023, Nebraska will allow full expensing on qualified property and qualified improvement property. This change significantly impacts cash flow and tax planning: 

• Immediate write-offs for qualifying capital investments
• Enhanced tax treatment for research and experimental expenditures that are required to be capitalized for federal tax purposes
• Potential acceleration of planned investments to maximize benefits 

3. Changes to Income Tax for Nonresident Individuals

Nonresident individuals earning compensation from a Nebraska-based business, trade, or profession will see adjustments to income taxation, also under LB 1023. This affects: 

• Remote workers and consultants serving Nebraska businesses
• Companies employing out-of-state talent
• Professional service providers crossing state lines 

Lutz Can Help You Navigate These Changes 

At Lutz, we understand that legislative changes can significantly impact your business or personal tax strategy. Our state and local tax team stays current with all Nebraska tax law changes to help you maximize opportunities while ensuring compliance.  

Whether considering employee relocation or planning capital investments, we can help you understand and implement strategies to optimize these new provisions. Contact us to learn how these legislative changes affect you and how we can help you prepare for 2025.