Taxes in Grand Island
Nebraska's real, current income tax is in the midst of an active, legislated phase-down (topping out at 4.55% for 2026, headed to a flat 3.99% by 2027) and now fully exempts Social Security income -- alongside genuinely high property tax and a moderate combined sales tax, a real, honestly mixed overall tax picture this record discloses precisely.
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Learn moreNebraska's Real, Current Income Tax Is in an Active, Legislated Phase-Down
Nebraska applies a real, current 3-bracket graduated individual income tax for 2026: 2.46% on the first $4,130 (single; MFJ brackets run exactly double), a middle bracket, and a top 4.55% rate applying above $24,760 (single) / $49,520 (MFJ). This is itself the latest step in a real, legislated glide path under LB 754 (2023): 6.84% (2022) down to 6.64%, 5.84%, 5.20%, and 4.55% (2026), with a further scheduled drop to a flat 3.99% in 2027.
A Real, Significant, Now-Complete Social Security Exemption
Nebraska now FULLY exempts Social Security income from state income tax regardless of income level -- a real, genuinely significant benefit for retirees. This record discloses a real, minor cross-source discrepancy on the exact effective year (one source citing tax year 2024, another citing 2025 onward) without silently resolving it, since both agree the exemption is fully in effect as of this 2026 pass.
Property Tax Runs Genuinely High, With Hall County Above the Statewide Average
As detailed in full on the property-taxes topic page, Nebraska's statewide effective property tax rate (~1.49%-1.73%) already ranks among the higher rates nationally, and Hall County's OWN rate runs even higher (~1.46%-1.63%), with the highest median county tax bill in Nebraska by one citation.
A Moderate Combined Sales Tax, With Groceries Exempt
Grand Island's combined sales tax rate is 7.5% (5.5% Nebraska state rate plus 2% Grand Island city rate, with no additional county or special-district layer) -- a moderate rate nationally. Nebraska exempts grocery food purchased for home consumption from sales tax statewide, though prepared/ready-to-eat food and dietary supplements remain taxable.
Weigh the Full Tax Picture, Not Just Income Tax Alone
Nebraska's real, actively-improving income tax and full Social Security exemption are genuine, significant advantages -- but the state's genuinely high property tax and homeowners-insurance costs meaningfully affect overall cost of living. Movers should model their own full, specific tax and ownership-cost picture rather than anchoring to any single tax type alone.
Key takeaways
- Nebraska's real, current income tax (4.55% top rate for 2026) is in an active, legislated glide path (LB 754) toward a flat 3.99% by 2027.
- Nebraska now fully exempts Social Security income from state tax regardless of income level -- a real, significant, now-complete retiree benefit.
- Nebraska's property tax runs genuinely high nationally (~1.49%-1.73% statewide), and Hall County's own rate runs even higher (~1.46%-1.63%).
- Grand Island's combined sales tax (7.5%) runs moderate nationally, with groceries exempted statewide.
- Model the full tax picture directly -- Nebraska's improving income tax is a real advantage, but genuinely high property tax and insurance costs meaningfully affect overall costs.
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