What are Income Law Requirements in the State of Mississippi?
Tax is the contribution to the state revenue levied by the government on income and business profits. It is also added to the cost of goods and services, and financial transactions. Where there is income, there is the tax. Everyone who makes an earning is liable to pay a certain amount as tax. These tax rates differ from state to state as well as the mode of income or financial transaction.
Mississippi Department of Revenue in Mississippi
The Mississippi Department of Revenue was formerly known as the State Tax Commission. It is responsible for the collection and administration of tax revenue in the state of Mississippi. It is headed by the Commissioner of Revenue for 6 years. The commissioner of Revenue is appointed by the Governor.
The Department of Revenue is responsible for registration and titling or motor vehicles. It is also responsible for the valuation of properties and enforcement of Prohibition and Local Option Law. The Department of Revenue in Mississippi has divided tax into the following:
Individual Income Tax Mississippi
The state of Mississippi has three tax brackets: 3%, 4% and 5% based on the personal income of the individual. Married couples are allowed to file combined tax returns. Each spouse can calculate the tax liability separately and add the results. Mississippi allows tax exemption up to a certain amount depending on the filing status. The criteria for exemption are, married spouse deceased, married filing separate, head of the family with at least one dependent, senior citizen and such.
Business taxes in Mississippi
It includes petroleum tax, gaming tax, interstate commercial vehicle tax and many others related to business.
Sales and use tax: The Mississippi Department of Revenue administers sales tax of 7% for several local governments. The tax is based on the type of business. An online sales tax rate calculator is also provided to determine the tax rates. A fact sheet is issued on special local taxes.
Use tax refers to the tax levied on personal property acquired for use, storage or consumption within Mississippi. Use tax of 7% is calculated based on the purchase price, installation and service charges, and freight.
Withholding tax: is the tax deducted at source. It is levied by a country on interest or dividend paid to a person residing outside the country.
Tags and titles
Tags and titles refer to tax levied upon motor vehicles ad valorem. When the tax is calculated based on the value of the motor vehicle multiplied by the millage rate set by the local government, it is called ‘motor ad valorem tax.’
Alcoholic beverage control
Alcoholic beverages include liquors, spirits and wine with more than 5% alcohol. Any beverage that contains less than 5% alcohol is taxed under a different statue. Native wine tax, mark-up tax, and excise tax on alcoholic beverages are to be paid.
Property tax in Mississippi
Personal and real property taxes: A fixed percentage of the market value of the property is calculated as the tax. When the tax is calculated based on the value of a transaction or of property, it is called ‘ad valorem tax.' To assess the ad valorem tax, taxable property is divided into five classes.
Class 1: 10% - Single/family, owner-occupied residential real property
Class 2: 15% - All other real property
Class 3: 15% - Personal property
Class 4: 30% - Public service property assessed by the state or county
Class 5: 30% - Motor Vehicle
Inheritance and estate tax
The Mississippi state does not charge inheritance and estate tax anymore.
The tax rates change year by year. Keeping up-to-date on the tax rates and also gaining more information about the tax laws of Mississippi before filing for tax will be helpful.