NE LB846

Amends Nebraska Revised Statutes section 77-2716.01 governing individual income tax deductions, effective for taxable years beginning on or after January 1, 2026

Creates a new limitation on the state and local income tax (SALT) deduction for Nebraska taxpayers who itemize federal deductions

Caps the SALT deduction at the federal limitation amount set under Internal Revenue Code section 164(b)(7) for taxable years beginning after calendar year 2029

Maintains existing rules for taxable years before January 1, 2026, which excluded the full amount of state or local income taxes from Nebraska itemized deductions before any federal disallowance

Preserves taxpayers' ability to claim the greater of the standard deduction or itemized deductions when calculating Nebraska taxable income