TIN ComplianceA resource from TIN Comply
Backup withholding
No
Nonresident payments
Yes, 4%
Threshold
$600
Forms
941N, 20
State withholding

Nebraska backup withholding and nonresident contractor withholding

Nebraska excludes federal backup withholding payments from its definition of withholdable payments (Neb. Rev. Stat. 77-2753(6)) and has two nonresident rules instead. Under 77-2753(2), a payer withholds on personal services performed substantially in Nebraska by a nonresident individual, or by an entity 80 percent owned by the individuals performing the services, at 4 percent of net payments under $28,000 and 6 percent at $28,000 or more, once payments pass $600 (payor with a Nebraska office) or $5,000. Under 77-2753(3), any contractor paying another contractor for construction services in Nebraska withholds 5 percent if the payee is not in the Nebraska Contractor Database. Forms W-4NA and W-4NB handle the computation and the exemption.

State backup withholding not requiredNonresident non-wage withholding requiredSources checked November 1, 2026Updated November 1, 2026
In this guide
  1. Status
  2. Withholding on non-wage payments to nonresidents
  3. What Nebraska does not require
  4. Pass-through entity withholding
  5. From the source
  6. Sources

Status

State backup withholdingNot required

Primary source (statute, regulation or agency publication saved in full)

Non-wage payments to nonresidentsRequired

Primary source (statute, regulation or agency publication saved in full)

Federal backup withholding under IRC 3406 (24 percent on a missing or mismatched TIN) applies in Nebraska exactly as everywhere else; this page covers only what the state adds. The 50-state tables put Nebraska next to its neighbours, and the Nebraska 1099 filing page covers whether the state wants its own copy of the 1099.

Withholding on non-wage payments to nonresidents

Applies to
(1) Nonresident individuals (non-employees not subject to federal wage withholding) paid for personal services performed substantially in Nebraska: consultants, entertainers, athletes, performers, public speakers, professional services, non-construction contractors. (2) Corporations, partnerships and LLCs where 80% or more of the ownership is held by the individuals performing the services (loan-out style entities); withholding allocated to owners. (3) Separately, any contractor paying another contractor for construction services in Nebraska withholds 5% if the payee is not registered in the Nebraska Contractor Database (applies to residents too).
Threshold
Personal services: payments exceed $600 if the payor maintains an office or transacts business in Nebraska, otherwise payments exceed $5,000. Construction contractor rule: payments exceed $600.
Rate
Personal services: 4% of net payments (payment minus allowed expenses capped at 50%) if total net payments for the service are under $28,000; 6% if $28,000 or more. Unregistered construction contractors: 5% of payments.
Statute
Neb. Rev. Stat. 77-2753(2) (personal services), 77-2753(3) (construction contractors); 316 Neb. Admin. Code ch. 21; Information Guide 8-515 (Jan 2012); Circular EN
Withholding return
Form 941N (Nebraska Income Tax Withholding Return) and W-3N annual reconciliation; register with Form 20
Exemption certificate or waiver
Form W-4NA (Nebraska Withholding Certificate for Nonresident Individuals, computes withholding and allocates to owners); Form W-4NB (payor/payee agreement that withholding is not required, e.g., entity not 80% owned by performers); treaty statement for nonresident aliens; Contractor Database lookup for construction
Payee statement
Federal Form 1099-NEC (or 1042-S) by January 31 or within 30 days after services end; separate 1099-NECs to each performing owner of an entity
Due dates
Reported and paid with regular withholding on Form 941N; 1099-NEC by January 31 (or 30 days after service); W-3N annual
Exceptions
Nonresident aliens providing a treaty statement; payments subject to the 5% construction contractor withholding; services where capital furnished by the nonresident is a material income-producing factor (over 50% of payment); board of directors services (tax years from 2025); entities not 80% owned by performers (Form W-4NB); nonresident contractors furnishing material capital; wages

What Nebraska does not require

State backup withholding

No state backup withholding: Neb. Rev. Stat. 77-2753(6) defines payments subject to withholding as employer payments to employees “except such payments subject to 26 U.S.C. 3406”, gambling winnings, requested pension withholding, and independent contractor payments; Circular EN: 'Backup withholding on interest and dividends is not required for Nebraska income tax withholding purposes.'

Basis: Primary source (statute, regulation or agency publication saved in full).

Pass-through entity withholding (out of scope)

Nebraska requires pass-through entities to withhold for nonresident individual owners (77-2727). Entity-level withholding on distributions to nonresident owners is a duty of the entity, not of a payer, and is not covered on this page.

From the source

“except such payments subject to 26 U.S.C. 3406”

Neb. Rev. Stat. 77-2753(6), read November 1, 2026

“four percent, and for all other payments, the percentage shall be six percent”

Neb. Rev. Stat. 77-2753(2)(b), read November 1, 2026

“Backup withholding on interest and dividends is not required for Nebraska income tax withholding purposes”

Nebraska DOR, 2026 Circular EN, read November 1, 2026

Sources

Each source below was read and saved on November 1, 2026; the page is built from the saved text. Statutes are cited to the section; department pages and publications to their title and, where shown, revision date.

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