Compare taxes and see how much you save moving from Nebraska to Iowa
Nebraska and Iowa are both cutting their income taxes aggressively — but Iowa moved faster. Iowa reached a flat 3.8% in 2025 (down from 8.53%), with a further cut to 3.5% in 2026. Nebraska is on a path from 5.84% (2024) to a flat 3.99% by 2027, with some forecasts suggesting further reductions. Today: Iowa is clearly cheaper — at $100,000 income, Iowa saves approximately $2,040 in income taxes vs Nebraska. By 2027, the gap narrows: Iowa at 3.5% vs Nebraska at 3.99% — a $490/year difference at $100,000. On property taxes, Nebraska's ~1.73% is higher than Iowa's ~1.57%; on a $250,000 home, approximately $400/year more. Iowa wins the comparison at every income level today, and maintains a modest advantage by 2027. Nebraska's Omaha metro offers a larger professional economy than Des Moines, which may justify the slightly higher near-term tax cost for career-focused movers.
Top Rate (reducing to 3.99% flat by 2027)
Progressive 2.46%–5.84% (2024); legislated flat 3.99% by 2027; property tax ~1.73%
Flat Rate (2025)
Flat 3.8% since 2025 (from 8.53% top); further cut to 3.5% in 2026; property tax ~1.57%
At $100,000 income:
That is $200/month back in your pocket!
| Income | NE Tax | IA Tax | Savings | 10-Year |
|---|---|---|---|---|
| $50,000 | $2,256 NE income tax (~4.51% effective); ~$2,595 property ($150K × 1.73%) = ~$4,851 total | $1,900 IA income tax (3.8%); ~$2,355 property ($150K × 1.57%) = ~$4,255 total | IA saves ~$596 | $5,960 |
| $75,000 | $3,900 NE income tax (~5.2% effective); ~$3,460 property ($200K × 1.73%) = ~$7,360 total | $2,850 IA income tax; ~$3,140 property ($200K × 1.57%) = ~$5,990 total | IA saves ~$1,370 | $13,700 |
| $100,000 | $5,340 NE income tax (~5.34% effective); ~$4,325 property ($250K × 1.73%) = ~$9,665 total | $3,800 IA income tax; ~$3,925 property ($250K × 1.57%) = ~$7,725 total | IA saves ~$1,940 | $19,400 |
| $150,000 | $8,400 NE income tax (~5.6% effective); ~$6,055 property ($350K × 1.73%) = ~$14,455 total | $5,700 IA income tax; ~$5,495 property ($350K × 1.57%) = ~$11,195 total | IA saves ~$3,260 | $32,600 |
| $200,000 | $11,296 NE income tax (~5.65% effective); ~$7,785 property ($450K × 1.73%) = ~$19,081 total | $7,600 IA income tax; ~$7,065 property ($450K × 1.57%) = ~$14,665 total | IA saves ~$4,416 | $44,160 |
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Moving between Nebraska and Iowa? Both states' income tax rates are changing rapidly — partial-year returns and rate transition planning need specialist help. Get matched with a CPA who specialises in Great Plains state moves.
Get Matched With a CPA →Nebraska's income tax reform is phased. In 2024: progressive brackets of 2.46%, 3.51%, 5.01%, and 5.84%. The reform signed in 2023 (LB 754) consolidates Nebraska to a two-bracket system in 2025 (2.46% and 5.20%) and then a single flat rate of 3.99% in 2027. The 2026 rate is an intermediate step with brackets converging toward 3.99%. Nebraska's Governor Pillen has expressed interest in further reductions beyond 3.99%, potentially matching Iowa's trajectory toward 3.5% or lower in subsequent years. For planning purposes: assume 3.99% flat as Nebraska's target rate from 2027 onward.
Both are affordable Midwest metros, but Omaha is larger and has deeper corporate infrastructure. Omaha (metropolitan population ~1 million) vs Des Moines (~700,000). Omaha advantages: Berkshire Hathaway investment culture, Union Pacific HQ, TD Ameritrade/Charles Schwab operations, Mutual of Omaha, and a broader financial services talent pool. Des Moines advantages: Principal Financial, growing tech startup scene (backed by Iowa's universities), and slightly lower taxes today. Housing is comparable in both metros ($220,000–280,000 median). Both cities have lower cost of living than Minneapolis, Chicago, or Kansas City. For finance and insurance careers: Omaha has a modest edge. For entrepreneurship and emerging tech: Des Moines's growing ecosystem is competitive.
Nebraska offers a homestead exemption for qualifying individuals rather than a universal reduction. The Nebraska homestead exemption provides full or partial property tax exemption for: (1) qualified elderly individuals (age 65+) with income below certain thresholds (approximately $46,000 for 2024); (2) veterans with service-connected disabilities at 100%; (3) totally disabled individuals below income thresholds. The exemption is means-tested, not universal. Nebraska's overall effective property tax rate of ~1.73% for non-exempt properties is the result, placing Nebraska above the national median. Iowa similarly does not offer a broad universal homestead exemption that materially reduces effective rates.
Both states are among the top agricultural states in the US, but they have different agricultural focuses. Iowa: #1 US corn producer, #1 US soybean producer, #1 US pork producer, #1 ethanol producer. Nebraska: #1 US cattle state, #3 corn producer, significant wheat and sorghum production. For farmers, the tax comparison has an additional dimension: agricultural property in both states is often assessed at agricultural use value (not market value), producing effective rates much lower than the residential averages quoted here. Nebraska's agricultural property tax has been a subject of significant political debate and reform pressure. Iowa's agricultural land is subject to special assessment rules that moderately reduce effective rates for farm operations.
Iowa is better for most retirees on taxes. Iowa exempts Social Security benefits for filers below $75,000 (single) / $100,000 (joint) and provides pension exclusions for filers 55+. Iowa's flat 3.8% rate on other retirement income is lower than Nebraska's current top effective rate. Nebraska taxes Social Security benefits at the same rates as federal (full inclusion), though Nebraska has enacted a phased reduction of the Social Security tax — reducing it to 60% of the federal amount in 2024, 40% in 2025, and fully exempting it in 2026. Once Nebraska fully exempts Social Security in 2026, the retirement tax comparison narrows. Property tax is the other major retiree consideration — at similar fixed incomes and home values, both states are broadly comparable with Iowa's lower rate providing a modest advantage.