How Much Would You Save: Nebraska vs Florida Taxes

Nebraska has been on an aggressive path to lower its income tax burden. Governor Jim Pillen signed LB 754 into law, setting a trajectory to cut the state's top individual income tax rate from 6.84% down to 3.99% by 2027. The reductions are phased in over several years, and for 2026 the top rate is 4.55%. While this is a meaningful improvement for Cornhusker State residents, it still leaves Nebraska well above the zero-percent rate that Florida offers.

Income taxes, however, are only part of the picture. Nebraska consistently ranks among the highest-property-tax states in the country, with an effective rate of roughly 1.54%, placing it 6th nationally. For a homeowner with a property valued at $250,000, that translates to nearly $3,850 per year in property taxes alone. Florida's effective property tax rate, by contrast, is about 0.78%, and the Sunshine State offers a generous homestead exemption that further reduces the taxable value of a primary residence.

Nebraska is also one of only six states that still levies an inheritance tax, and it is collected at the county level rather than by the state. Rates range from 1% for close relatives to as high as 18% for distant relatives or unrelated beneficiaries. This can create unexpected tax bills when assets pass between generations, particularly for families with farmland or business interests. Florida imposes no estate tax and no inheritance tax, making it a far more favorable state for long-term wealth transfer and estate planning.

Retirees considering a move should note that Nebraska retirement-income rules need a separate review from this wage model; do not apply its wage rate to all Social Security benefits. On a positive note, military retirement pay has been fully exempt from Nebraska state income tax since 2022. Still, retirees drawing income from pensions, 401(k) distributions, or investment gains will pay Nebraska's standard income tax rates on that income, while Florida taxes none of it.

Even with the ongoing rate reductions under LB 754, the math continues to favor Florida for most high-earning professionals. At $100,000 of annual wage income, this model estimates $3,670 of Nebraska state income tax for a single filer, versus no Florida individual income tax. This is a full-year comparison, excludes local taxes and does not calculate a move-year return. Property and inheritance taxes require separate review. In Florida, that same worker pays zero state income tax, benefits from lower property taxes, and faces no inheritance or estate tax. For workers who have the flexibility to establish residency elsewhere, the cumulative savings over a career can reach six figures, making the case for Florida residency as compelling as ever.