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Insurance offered through OnPay Insurance Agency, LLC (CA License #0L29422)
Updated: January 6, 2023
A perfect Saturday morning in the fall is all about watching the Huskers run while biting into a good old-fashioned Runza. Life in Nebraska doesn’t get any better than that, and that’s why you started a small business here. But whether you own an auto shop in Lincoln or a steakhouse in Omaha, there’s one thing that makes life a little more complicated: payroll taxes.
We also want you to spend more time watching football and less time worrying about payroll taxes, so we designed a nifty payroll calculator — just with you in mind. The calculator can figure out all of the federal and Nebraska state payroll taxes for you and your employees. All you have to do is input wage and W-4 information for each employee into the calculator, and it will do the rest.
First and foremost, we have to take care of federal taxes. Here’s a quick overview of the components that go into federal payroll tax withholdings. If you would like a more detailed explanation of all of the steps below, we invite you to head on over to our comprehensive step-by-step guide.
Now that we’ve paid Uncle Sam his due, let’s look at Nebraska state income taxes. The state charges a progressive income tax, broken down into four tax brackets. The 2023 tax rates range from 2.46% to 6.84%.
There are no local taxes, so all of your employees will pay the same state income tax no matter where they live.
As an employer in Nebraska, you have to pay unemployment insurance to the state. The 2022 rates range from 0% to 5.4% on the first $9,000 in wages paid to each employee in a calendar year.
If you’re a new employer (congratulations on getting started!), you pay a flat rate of 1.25%. If you’re in the construction industry, your rate is 5.4%.
Time for another Runza run! You’ve checked payroll taxes off your to-do list so you can focus on growing your small business. Once each employee’s net pay is calculated, you’re good to cut some checks.
All you have to worry about is getting your employees paid on time as well as setting aside whatever you owe in FICA and unemployment taxes. Those numbers can add up quickly!
You will need to fill out Form 941 to file federal taxes on a quarterly basis, and Form 940 to report your annual FUTA liabilities. You can pay taxes online using the EFTPS payment system. All the IRS employment tax due dates can be found here.
If you would like to learn more about Nebraska payroll taxes, here are some helpful links to state websites that we think can be useful:
Nebraska Department of Labor (402) 471-9898 | Register Online | Employer’s Guide to Unemployment Insurance
Nebraska Department of Revenue (402) 471-5729 | Register Online | Income Tax Withholding FAQs
Try OnPay out yourself to see how easy payroll and HR can be. To get started, just share a few basic details about your business. Our team of pros will set everything up and import your employees’ information for you.