- Associated Press - Saturday, February 22, 2014

LINCOLN, Neb. (AP) - A legislative panel has advanced a proposal to ensure that Nebraska’s income-tax brackets keep pace with inflation.

The Revenue Committee bill seeks to address cost-of-living salary increases that can bump taxpayers into a higher bracket, where they end up paying more. Committee members moved the measure Friday with an 8-0 vote.

Sen. Galen Hadley, the committee chairman, says indexing the brackets to track inflation amounts to a significant long-term tax cut.

Nebraska’s top income tax rate for a married couple filing jointly kicks in at $58,000. If the brackets had been inflation-adjusted in 1993, that couple wouldn’t pay the top rate until their income hit $84,400.

The bill would also exempt some Social Security income that falls below certain thresholds.

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The bill is LB987

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