State Taxes on Social Security Benefits to Phase Out Faster
Thursday, May 5, 2022
Older Nebraskans will be keeping more of their hard-earned Social Security benefits even sooner, after Gov. Pete Ricketts signed Legislative Bill 873 into law.
All state income taxes on Social Security checks will now be eliminated by 2025, five years earlier than outlined in a measure passed last year.
Todd Stubbendieck, state director for AARP Nebraska, said dropping the tax is the right thing to do for nearly 350,000 Nebraska seniors facing rising prices at supermarkets and at the gas pump.
"This program was never designed to be a revenue raiser for the states," Stubbendieck explained. "This is hard-earned Social Security benefits, all of it should be in seniors' pockets spending how they want it to be spent."
Stubbendieck noted the vast majority of older Nebraskans are not wealthy with big pensions, they are middle-income people living on a fixed budget. Nearly 55% of beneficiaries rely on Social Security for half or more of their income, and about 28% rely on Social Security for at least 90% of their income.
Stubbendieck emphasized removing taxes from benefits will help Nebraskans live their retirement years independently and with dignity, and will also boost local economies. Nebraskans age 50 and older account for 56 cents out of every dollar spent in the state, creating an annual economic impact of $50 billion.
"We're past the point of savings, we're at the point of spending our savings," Stubbendieck stressed. "The dollars that are going to go into people's pockets because of this tax cut are going to be spent in our local economies, and are going to be a big economic driver in those communities."
Older Nebraskans will see immediate benefits from the measure, which reduces taxes on Social Security benefits this year by 40%. Next year, seniors will see an exemption of 60%. In 2024 the exemption rises to 80%, with all state taxes on benefits set to end in 2025.
get more stories like this via email
Many of California's 13.5 million children and teens have not bounced back after the pandemic, especially children of color, according to the just-…
Americans continue to report low trust in mainstream media, with many younger than 30 saying they trust information from social media nearly as much …
A Minnesota House committee heard testimony Thursday about the governor's proposed spending plan for education. As these talks unfold, public polling …
Health and Wellness
Health-care professionals say low pay and a worker shortage have led a dramatic number of nursing homes in rural Iowa to close their doors. They hope …
Health and Wellness
Health-care professionals and advocates in Connecticut have said it will take sweeping reforms to bolster the state's flailing public health system…
By nearly every measure, voter fraud in U.S. elections is rare, but that isn't stopping the Texas Legislature from considering dozens of bills this …
A Republican-sponsored bill in the Arkansas Legislature would make it illegal to circulate petitions at or near polling places during elections…
New Mexico residents have two weeks to submit written comments to the Environmental Protection Agency about its proposal to implement stronger standar…