Nebraska Hourly Paycheck Calculator
Paying your Nebraska employees means more than just writing paychecks. There are the taxes, deadlines, and paycheck rules and laws you’ll need to follow. But don’t let that sideline you from growing your business. We’ve summarized all the Nebraska payroll taxes and paycheck rules for you here.
Nebraska state payroll taxes
Nebraska withholding tax
As an employer, you’re responsible for taking state income tax out of employees’ paychecks. But how do you know what amount to withhold?
Employees are required to complete Nebraska Form W-4N, Employee’s Nebraska Withholding Allowance Certificate, when they start working for you. This form will let you know the critical information you’ll need to make the tax calculation.
Using your employee’s gross wages and Nebraska’s withholding tax tables, you can determine the amount of tax to deduct. But you can save yourself time by using payroll software that has the tax tables built into it. With just a few clicks you’ll have withholding calculations made automatically.
Paying Nebraska withholding tax
Depending on how much tax you withhold, you’ll need to make monthly or quarterly payments. Regardless of when you make payments, you’ll also need to file quarterly reports using Form 941N, Nebraska Income Tax Withholding Return.
A quarterly report is still required even if you paid no wages. You can receive a fine for failing to file these “zero reports.” Some businesses may be allowed to file a single Form 941N for the entire year. These companies usually have small payrolls and must receive a special license from the state to qualify as an annual filer.
All employers must file an annual reconciliation of income tax withheld using Form W-3N. Along with this report, you’ll need to send copies of your federal Form W-2 and 1099s that have Nebraska tax withheld.
Nebraska unemployment tax
Nebraska’s unemployment tax system classifies employers into one of 20 categories based primarily on your experience using the unemployment program. Tax rates range from 0% to 5.4%.
New non-construction industry employers with no or little experience with the unemployment system pay a 1.25% tax rate. New construction employers pay the highest rate of 5.4%.
Most employers will pay unemployment tax on the first $9,000 of each employee’s wages each year. However, employers in category 20 (the highest taxed category) pay tax on the first $24,000 of each worker’s pay each year.
You’ll need to pay your unemployment tax and file wage reports each quarter. Wage reports are required even if you had no payroll for the quarter.
Nebraska paycheck rules and laws
Payroll in Nebraska is about more than just payroll taxes. There are paycheck laws to comply with too. Keep these in mind.
- New hire reporting: Employers have 20 days from the hire date to report new employees to the state directory.
- Minimum wage: Nebraska’s minimum wage is $9.00 per hour.
- Final paychecks: Employers have until the next regularly scheduled payday, but no more than two weeks after their final day, to provide final wages to employees who leave.
- Overtime: Nebraska has no state law governing overtime pay. So the federal rules under the Fair Labor Standards Act apply, which requires hourly employees to be paid at least 1 ½ times their hourly rate for hours worked over 40 in a week.
- Jury leave: Employees selected to serve on a jury must be paid their regular pay rate for the duration of the jury duty. Employers may deduct the $35 per day the Court pays the juror.
- Voting leave: Employers are required to provide up to two paid hours of leave to allow workers to vote.
- Workers’ Compensation insurance: Requirements to obtain Workers’ Compensation vary by state, this table outlines some of these requirements. If you determine that your company is required to purchase Workers’ Compensation insurance in your state, learn how to sign up for this insurance with Gusto.
Sometimes, companies get a request for a workers’ comp audit—head to this article and click the workers’ comp audit reports dropdown for more information.
Federal payroll taxes in Nebraska
All Nebraska employers and employees pay various federal payroll taxes. There are four withholding taxes that you will send to the Internal Revenue Service:
- Federal income tax (FIT)
- Additional Medicare tax
- Federal unemployment tax (FUTA)
Taxes paid by both the employer and employee:
- Social Security and Medicare tax (FICA)
Federal income tax (FIT)
Use Form W-4, Employee’s Withholding Certificate, to determine the amount of federal income taxes to withhold from your employees’ paychecks. Employees should complete this form when hired and whenever they have changes that may impact the amount of tax they will owe.
Use the information on Form W-4 and tax tables to compute the amount of tax to take out. To make it easier on you, payroll software can help with the math by making the calculations for you.
Don’t mail the W-4s to the IRS; just file them away in case of an audit.
Social Security and Medicare tax (FICA)
The Federal Insurance Contributions Act, or FICA tax, is made up of the Medicare tax and the Social Security tax. In 2022, the Social Security tax requires employers and employees to each contribute 6.2% of wages up to $147,000. The Medicare tax requires each to contribute 1.45% of all wages. See the IRS webpage for details, like maximum thresholds.
Federal unemployment tax (FUTA)
Like the state, the federal government also has an unemployment tax. It’s called FUTA and it’s an annual tax employers pay on the first $7,000 of each employee’s wages. The FUTA rate for 2022 is 6%, but most employers only have to pay 0.6% each year.
Filing and paying Federal payroll taxes
You’ll need to send the withheld taxes and your portion of FICA to the IRS either monthly or semi-weekly, depending on how much tax you owe. And each quarter, you’ll need to do a summary report on Form 941, Employer’s Quarterly Federal Tax Return.
For federal unemployment tax, you’ll need to make quarterly payments if your tax is more than $500. If your tax is less than $500 a year, you can pay the tax when you complete your annual summary report on Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return.