Nebraska does not tax long-term capital gains at a lower rate. A gain from stocks, a business or real estate is part of your federal adjusted gross income, and the Nebraska return taxes it with the rest of your taxable income on one graduated schedule. The top rate for 2026 is 4.55%. There is one gain-specific exclusion in the Department's forms, a limited election for employees who sell stock of a qualifying corporation, and a separate subtraction for gold and silver bullion.
This guide uses the Nebraska Department of Revenue's 2026 estimated tax booklet (Form 1040N-ES), its 2025 individual income tax booklet, its 2026 Form 4797N and two IRS pages, all read on 3 November 2026. We could not open the Nebraska Revised Statutes website from our system, so every rule below is stated as the Department's forms state it, and the Department's 2026 Form 4797N and 2027 estimated tax form are the newest documents we found.
Nebraska uses a graduated schedule with three effective rates for 2026. The Department's 2026 estimated tax booklet says the tax year 2026 individual income tax rates for the third and fourth brackets are at the same rate of 4.55%, so in practice the rates are 2.46%, 3.51% and 4.55%. For comparison, the Department's 2025 tax table applies 5.20% to Nebraska taxable income above $77,760.
The table shows where each rate starts for 2026, from the Department's 2026 rate schedule. Married filing separately uses the same thresholds as single.
| Filing status | 2.46% up to | 3.51% from | 4.55% above |
|---|---|---|---|
| Single / married filing separately | $4,130 | $4,130 to $24,760 | $24,760 |
| Head of household | $7,700 | $7,700 to $39,620 | $39,620 |
| Married filing jointly / surviving spouse | $8,250 | $8,250 to $49,530 | $49,530 |
One caution: the Department labels this schedule as for computing 2026 estimated tax only and not for completing a return. The final 2026 tax table will be in the 2026 return booklet, which we have not seen, so confirm the thresholds there before you file. The same worksheet shows 2026 standard deductions of $8,850 single, $17,700 married filing jointly, $12,950 head of household and $8,850 married filing separately, and a $176 personal exemption credit.
Form 1040N line 5 starts with federal adjusted gross income, the amount reported on your federal return. A capital gain on your federal return is therefore already in your starting figure. Nebraska taxable income then equals line 11 plus the Schedule I increases minus the Schedule I decreases. We read no Nebraska rule that treats short-term and long-term gains differently.
IRS Topic 409 says that if you have a net capital gain, a lower tax rate may apply than the rate on your ordinary income, and that you generally have a long-term gain if you hold the asset more than one year. That federal difference does not appear in Nebraska's rate schedule, which applies to taxable income as a whole.
The Schedule I instructions give two other gain items. First, Nebraska subtracts any net capital gain from the sale or exchange of gold or silver bullion to the extent it is in federal adjusted gross income, and adds back a net capital loss on bullion. The subtraction does not apply to a gain from bullion sold as a taxable distribution from a retirement plan account. Second, capital gains from the sale of U.S. government obligations are not deductible, even though interest on those obligations may be.
Nebraska Schedule I allows a special capital gains and extraordinary dividend deduction, claimed on Form 4797N (line 21 according to the 2026 Form 4797N; line 19 in the 2025 booklet we read). It is available only to Nebraska residents, or to a part-year resident while a resident, and Form 4797N, federal Schedule D and either Form 8949 or Part IV of Form 4797N must be attached. A part-year resident does not include the amount on Schedule III line 1. The details below come from the 2026 Form 4797N, whose rules match the 2025 version in every respect described here; the Department's 2026 individual return booklet was not yet posted when we checked, so confirm the current form before relying on it.
This election is narrow. The form lists stock received through the creation or purchase of a corporation by an investor who is not an employee, and stock received for services by a non-employee, as non-qualified.
Because Nebraska starts from federal adjusted gross income, the federal loss rules carry into the Nebraska return. IRS Topic 409 says that if your capital losses exceed your capital gains, the excess loss you can claim to lower your income is the lesser of $3,000 ($1,500 if married filing separately) or your total net loss, and that a larger net loss can be carried forward to later years. The Nebraska bullion add-back mentioned above is the one loss adjustment we found in the instructions we read.
These figures are our arithmetic using the Department's 2026 single rate schedule, not an official calculation. They ignore credits, the personal exemption credit and adjustments, and round to cents.
| Nebraska taxable income (single) | Tax on the 2026 schedule |
|---|---|
| $10,000 | $307.64 |
| $25,000 | $836.63 |
| $50,000 | $1,974.13 |
| $100,000 | $4,249.13 |
| $200,000 | $8,799.13 |
Worked example (ours): a single filer has $60,000 of wages and a $50,000 long-term gain in 2026, takes the $8,850 standard deduction and has no Schedule I adjustments. Taxable income without the gain would be $51,150 and tax $2,026.45. With the gain it is $101,150 and tax $4,301.45. The gain adds $2,275.00, which is $50,000 times 4.55% because the whole gain sits above $24,760. A smaller example: with $10,000 of taxable income, a $20,000 gain takes taxable income to $30,000, so the tax goes from $307.64 to $1,064.13, an increase of $756.49, because part of the gain is taxed at 3.51% and the rest at 4.55%. Real returns differ because of credits and other items.
The Department defines a resident as someone whose domicile is in Nebraska, or who is physically present in the state and maintains a permanent place of abode there for an aggregate of more than six months. It adds that a person with a permanent place of abode in Nebraska who is present at least 183 days in the tax year is a Nebraska resident even if domiciled in another state.
Nonresidents and part-year residents must complete and attach Schedule III even if all their income is earned in Nebraska. They enter their total federal adjusted gross income on line 5, not just Nebraska-source income, and the tax is apportioned by a ratio of Nebraska income to total income. The ratio cannot exceed 100%, and Schedule III line 9 multiplies the Nebraska tax after the personal exemption credit by that ratio. Nonresidents are not allowed any credits in the line 6 calculation. The Schedule III list of Nebraska-source income includes gain or loss, and for a part-year resident it also covers sales of intangibles while a resident, to the extent the income is not taxed by another state. The booklet refers readers to the Department's website for the detailed list; we did not find in the pages we read a rule for when a nonresident's stock sale counts as Nebraska-source, so we state none.
A full-year Nebraska resident who paid income tax to another state on the same income completes Schedule II. The allowable credit is the least of the amounts on lines 1, 4 and 5 of that schedule. The special capital gains election above is not available to nonresidents.
We found no separate Nebraska home sale rule in the pages we read. IRS Topic 701 says you may qualify to exclude up to $250,000 of the gain on the sale of your main home from your income, or up to $500,000 if you file a joint return with your spouse. Because Nebraska starts from federal adjusted gross income, we read the effect as leaving only the gain above the federal exclusion for Nebraska to tax; the Department's pages we read do not say this in so many words. For the federal test, see our home sale capital gains guide.
The Department has posted a 2027 Form 1040N-ES (Rev. 9-2026). A copy in its drafts folder is stamped as a draft as of 25 September 2026; the copy in its 2026 forms folder, last modified 15 October 2026, carries no draft stamp and the same figures. It shows the third and fourth brackets at 3.99%, with the single-filer thresholds at $4,270 and $25,570 and a single standard deduction of $9,100. Like the 2026 schedule, it says it is for computing estimated tax only and not for completing a return. We could not open the Nebraska Revised Statutes site to confirm the enacted law behind it, so check the Department before timing a large sale.