Nebraska Income Tax Withholding

The State of Nebraska requires us to withhold Nebraska state income tax from certain payments made to non-resident companies and individuals who perform services in Nebraska.

Applies To:

  • Nonresidents of Nebraska
  • Who perform services in Nebraska
  • And total payments for the calendar year are, or expected to be over $600


  • Corporations, partnerships, and LLC are exempt unless:  80% or more of the company is held by the shareholder(s) performing the service (the requesting CU department needs to ask this specific question)
  • Caterers and Catering Companies are exempt from this withholding per Department of Revenue.  January 2007
  • Some Booking Agent payments (ask vendor or department):
    Must determine if they are an “independent agent” or a “production company”
    1. Independent agent = no withholding
    2. Production company = yes, withholding

Withholding Rates:

Payment, after unreimbursed expenses* is less than $28,000 = 4%
Payment, after unreimbursed expenses* is $28,000 or greater = 6%

*Unreimbursed Vendor Expenses:  These can be used to reduce the withholding rate up to 50%.  The company must list the UNREIMBURSED expenses on the W4NA lines 3-5.