This bill proposes an amendment to section 77-2716 of the Revised Statutes Cumulative Supplement, 2024, to introduce an income tax adjustment specifically for income received from overtime compensation. The aim is to provide a more equitable tax treatment for individuals earning additional income through overtime work, potentially reducing their overall tax burden. The bill also includes a repeal of the original section, indicating a significant restructuring of how income tax adjustments are applied.

In addition to the new provision for overtime compensation, the bill allows individuals to subtract amounts received as student loan repayment assistance under the Teach in Nebraska Today Act, health insurance premiums paid by retired firefighters or law enforcement officers, and annuities from the Civil Service Retirement System. It also provides exclusions for income related to military service for members of the Nebraska National Guard and the discharge of medical debt under the Medical Debt Relief Act. Furthermore, the bill specifies the treatment of capital gains and losses from the sale of gold or silver bullion, with net capital losses added to federal adjusted gross income and net capital gains subtracted, subject to certain exceptions. The significant insertion in the bill is the provision allowing individuals to subtract income received from overtime compensation under the Fair Labor Standards Act, effective for taxable years beginning on or after January 1, 2025.

Statutes affected:
Introduced: 77-2716