Tax Benefits and Credits for Immigrants in Nebraska in 2025

Key Takeaways

• Nebraska State EITC remains 10% of federal EITC for 2025, fully refundable for qualifying immigrants.
• No state child tax credit in 2025; bill pending to create a $1,000 refundable credit per child.
• New employer relocation tax credit effective 2025 benefits immigrants moving to Nebraska for eligible jobs.

As of July 11, 2025, several important updates affect the tax benefits and credits available to immigrants living and working in Nebraska. These changes, along with ongoing legislative proposals and new programs, shape the financial landscape for immigrant families, students, and workers across the state. This update provides a clear summary of what has changed, who is affected, effective dates, required actions, and the practical implications for both new and pending applications. The focus is on the Nebraska State Earned Income Tax Credit, the child tax credit, and other state-level programs that directly or indirectly impact immigrants.

Summary of Key Changes for 2025

• The Nebraska State Earned Income Tax Credit (EITC) remains at 10% of the federal EITC, with no increase for 2025.
• Nebraska still does not have a state-level child tax credit, but a bill proposing one is pending in the legislature.
• The Child and Dependent Care Tax Credit continues to offer significant support, especially for lower-income families, with refundability based on income.
• A new employer relocation tax credit takes effect in 2025, indirectly benefiting immigrants who move to Nebraska for work.
• The Nonresident Income Tax Tuition Credit remains available for immigrant students who paid Nebraska income tax in the previous year.
• Healthcare premium tax credits under the Affordable Care Act (ACA) continue to help many immigrants, though future funding is uncertain.

Let’s break down each program, explain who qualifies, what actions are needed, and what these changes mean for immigrants in Nebraska.

Nebraska State Earned Income Tax Credit (EITC): What’s New and Who Qualifies

The Nebraska State Earned Income Tax Credit is a key support for working families, including immigrants. For 2025, the credit remains 10% of the federal EITC amount. This means if you qualify for the federal EITC, you automatically qualify for the Nebraska state version.

Key Details:
– Fully refundable: If your credit is more than what you owe in state taxes, you get the extra money as a refund.
– Eligibility: You must qualify for the federal EITC. This usually means you have earned income from work, meet income limits, and have a valid Social Security number. Immigrants who are authorized to work and have a Social Security number can claim this credit.
– No recent increase: Although there were efforts to raise the Nebraska EITC to 15% or 20%, the rate stays at 10% for 2025.

Who is affected:
All immigrants in Nebraska who meet the federal EITC rules and file a state tax return are eligible. This includes families with children as well as some single workers.

Effective date:
This rate and eligibility apply to tax year 2025.

Required actions:
– File a Nebraska state income tax return using Nebraska Form 1040N and attach proof of your federal EITC eligibility.
– Make sure you have a valid Social Security number and meet all federal requirements.

Implications for pending applications:
If you are waiting for a decision on your federal EITC, you can still prepare your Nebraska return. Once your federal EITC is approved, you will automatically qualify for the state credit.

Nebraska Child Tax Credit: Current Status and What’s Next

As of mid-2025, Nebraska does not offer a state-level child tax credit. This means there is no extra state money for families with children beyond what is available from the federal government.

Pending Legislation:
Senator Danielle Conrad introduced Legislative Bill 294 in 2023, which would create a refundable state child tax credit of up to $1,000 per child. However, this bill is still in committee and has not become law.

Who is affected:
Immigrant families in Nebraska do not receive a state child tax credit at this time. Only the federal child tax credit is available, and you must have a valid Social Security number to claim it.

Effective date:
No state child tax credit is available for the 2025 tax year. If the bill passes in the future, updates will be provided.

Required actions:
– Continue to claim the federal child tax credit if you qualify.
– Watch for news about the state bill, as it could provide new benefits in future years.

Implications for pending applications:
There is no state child tax credit to apply for in 2025. If the law changes, families will need to follow new instructions from the Nebraska Department of Revenue.

Child and Dependent Care Tax Credit (CDCTC): Support for Working Families

Nebraska offers a state child and dependent care tax credit that helps families pay for child care or care for other dependents. The amount you get depends on your income and is based on a percentage of the federal credit.

How it works:
– Income-based percentages: Lower-income families get a higher percentage of the federal credit, up to 90%. As income increases, the percentage drops, and for higher-income families, the credit is not refundable.
– Refundability: For incomes below $29,000, the credit is fully refundable. This means you can get money back even if you owe no state tax.

Income brackets and credit percentages:
– $22,000–$22,999: 90% of federal credit (fully refundable)
– $23,000–$23,999: 80% (fully refundable)
– $24,000–$24,999: 70% (fully refundable)
– $25,000–$25,999: 60% (fully refundable)
– $26,000–$26,999: 50% (fully refundable)
– $27,000–$27,999: 40% (fully refundable)
– $28,000–$28,999: 30% (fully refundable)
– $29,000 and above: 25% (not refundable)

Who is affected:
Immigrant families who work and pay for child or dependent care, and who qualify for the federal credit, can claim this Nebraska credit.

Effective date:
These rules apply for the 2025 tax year.

Required actions:
– Calculate your federal child and dependent care credit first.
– Use the Nebraska income brackets to find your state credit percentage.
– File with your Nebraska state return.

Implications for pending applications:
If you have already filed for the federal credit, you can use that information to claim the Nebraska credit. If your income changes, check which bracket you fall into for the state credit.

Employer Relocation Tax Credit: New for 2025

A new program, created by Legislative Bill 1023, starts in 2025. This refundable income tax credit is for employers who pay relocation expenses for employees moving to Nebraska for work.

Key details:
– Employers can claim 50% of relocation expenses, up to $5,000 per employee.
– The employee’s salary must be between $70,000 and $250,000 per year.
– If the employee leaves Nebraska within two years, the credit is taken back.
– The total amount of credits given out is capped at $5 million per year.

Who is affected:
This credit is for employers, but it can help immigrants who are recruited to Nebraska for jobs. Employers may be more willing to cover moving costs, making it easier for immigrants to relocate.

Effective date:
Applies to relocation expenses paid in 2025 and after.

Required actions:
– Immigrants moving for work should ask potential employers if they participate in this program.
– Employers must keep records and apply for the credit through the Nebraska Department of Revenue.

Implications for pending applications:
If you are negotiating a job offer or planning to move, check if your employer will use this credit to help with your relocation costs.

Nonresident Nebraska Income Tax Tuition Credit: Help for Immigrant Students

Immigrant students who are not Nebraska residents but paid Nebraska income tax in the previous year can get a tuition credit for the 2024–2025 academic year.

How it works:
– The credit equals the amount of Nebraska income tax paid, up to the nonresident portion of tuition.
– This can lower the cost of attending Nebraska universities for immigrant students.

Who is affected:
Nonresident immigrant students who worked and paid Nebraska income tax.

Effective date:
Applies to the 2024–2025 academic year.

Required actions:
– File Nebraska income tax returns for the prior year.
– Submit an application to the University of Nebraska-Lincoln Student Accounts Office.

Implications for pending applications:
Students waiting for tuition bills or tax return processing should keep records and follow up with the university for credit application status.

Nebraska State Income Tax Rates and Deductions: What Immigrants Need to Know

For 2025, Nebraska’s income tax rates range from 2.46% to 5.20% across four brackets. The standard deduction is $7,900 for singles and $15,800 for married couples. Legislative Bill 754 is gradually lowering the top tax rates through 2027.

Who is affected:
All immigrants who file Nebraska state tax returns.

Required actions:
– Use the correct tax rate and deduction for your filing status.
– Plan your tax payments and credits accordingly.

Implications for pending applications:
If you are waiting for a tax refund or have questions about your tax bracket, check the latest tables from the Nebraska Department of Revenue.

Healthcare Premium Tax Credits: Indirect Financial Support

About 111,000 Nebraskans, including many immigrants, get help paying for health insurance through Affordable Care Act (ACA) premium tax credits. These credits are federal, not state, but they are important for many immigrant families.

Who is affected:
Immigrants who qualify for ACA coverage and meet income guidelines.

Effective date:
Credits are available for 2025, but future funding is not guaranteed.

Required actions:
– Apply for health insurance through the federal marketplace.
– Check if you qualify for premium tax credits.

Implications for pending applications:
If you are waiting for ACA enrollment or premium tax credit approval, keep your documents ready and watch for updates on federal funding.

Summary Table: Nebraska Tax Benefits for Immigrants in 2025

Practical Guidance and Next Steps for Immigrants

• Claiming Nebraska EITC:
  File Nebraska Form 1040N with your state return and include your federal EITC documentation.
• Child and Dependent Care Credit:
  Calculate your federal credit, check your income bracket, and claim the correct percentage on your Nebraska return.
• Monitor Legislative Changes:
  Stay informed about the progress of LB 294, which could create a new state child tax credit.
• Employer Relocation Credit:
  If you are moving for work, ask your employer if they will claim the new relocation credit and help with your moving costs.
• Nonresident Tuition Credit:
  If you are a student, file your taxes and apply through your university’s student accounts office.
• Healthcare Premium Credits:
  Apply for ACA coverage and check your eligibility for premium tax credits.

For more details, visit the Nebraska Department of Revenue’s official website, which provides up-to-date forms, instructions, and legislative updates.

Implications for Pending Applications and Stakeholders

• Immigrants:
  The Nebraska State Earned Income Tax Credit and the child and dependent care credit remain the most important state-level supports for working immigrant families. The lack of a state child tax credit means families must rely on federal benefits for now.
• Employers:
  The new relocation tax credit may encourage more companies to recruit immigrant workers and help with moving costs.
• Students:
  The nonresident tuition credit can make higher education more affordable for immigrant students who work and pay taxes in Nebraska.
• Healthcare:
  ACA premium credits continue to help many immigrant families, but future funding is uncertain.

As reported by VisaVerge.com, these programs and credits play a vital role in supporting Nebraska’s immigrant community, helping families manage living costs, access education, and settle into new jobs.

Conclusion and Actionable Takeaways

Immigrants in Nebraska should take the following steps to make the most of available tax benefits in 2025:
– File all required state and federal tax forms on time.
– Check eligibility for the Nebraska State Earned Income Tax Credit and child and dependent care credit.
– Ask employers about relocation support if moving for work.
– Monitor legislative news for updates on the state child tax credit.
– Apply for ACA premium tax credits if you need help with health insurance.
– Seek help from tax professionals or immigrant advocacy groups if you have questions.

Staying informed and proactive will help immigrants and their families benefit from Nebraska’s tax programs and prepare for any changes in the future.

Learn Today

Earned Income Tax Credit (EITC) → A refundable federal and state credit for low-to-moderate income workers based on earned income and family size.
Child and Dependent Care Tax Credit → A tax credit helping families pay for child or dependent care costs, varying by income level.
Refundable Credit → A tax credit that can result in a payment to taxpayers if it exceeds their tax owed.
Relocation Tax Credit → A credit given to employers covering part of employee relocation expenses to encourage work-related moves.
Nonresident Income Tax Tuition Credit → A Nebraska credit for nonresident students who paid state income tax, reducing tuition costs.

This Article in a Nutshell

Nebraska’s immigrant tax credits for 2025 include a steady 10% EITC, no state child credit, and a new employer relocation credit aiding immigrant workers’ moves.
— By VisaVerge.com