Income tax; authorize credit for investments in qualified clean-burning motor vehicle fuel property.

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To: Ways and Means
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Representative Johnson

HOUSE BILL NO. 119

AN ACT TO PROVIDE AN INCOME TAX CREDIT FOR A PERCENTAGE OF 1
THE COST OF INSTALLING NEW ALTERNATIVE FUELING INFRASTRUCTURE FOR 2
CERTAIN ALTERNATIVE FUELS; TO PROVIDE AN INCOME TAX CREDIT FOR A 3
PERCENTAGE OF THE COST OF INSTALLING A RESIDENTIAL COMPRESSED 4
NATURAL GAS FUELING SYSTEM; TO DEFINE CERTAIN TERMS USED IN THIS 5
ACT; TO PRESCRIBE THE MAXIMUM AMOUNT OF THE ONE-TIME CREDIT, BASED 6
ON THE TYPE OF QUALIFIED CLEAN-BURNING MOTOR VEHICLE FUEL 7
PROPERTY, WHICH MAY BE CLAIMED IN A TAXABLE YEAR; TO PROVIDE THAT 8
ANY UNUSED PORTION OF THE CREDIT MAY BE CARRIED FORWARD FOR THE 9
SUCCEEDING FIVE TAX YEARS; AND FOR RELATED PURPOSES. 10
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 11
SECTION 1. (1) As used in this section, the following words 12
and phrases have the meanings ascribed in this subsection unless 13
the context clearly indicates otherwise: 14
(a) "Qualified clean-burning motor vehicle fuel 15
property" means any one of the following: 16
(i) Equipment installed to modify a motor vehicle 17
that is propelled by gasoline or diesel fuel so that the vehicle 18
may be propelled by compressed natural gas, liquefied natural gas, 19
liquefied petroleum gas or propane gas. The equipment covered by 20
this subparagraph (i) must: 21
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1. Be new, not have been used previously to 22
modify or retrofit any vehicle propelled by gasoline or diesel 23
fuel and have been installed by an alternative fuels equipment 24
technician who is certified in accordance with the Alternative 25
Fuels Technician Certification Act; 26
2. Meet all Federal Motor Vehicle Safety 27
Standards set forth in 49 CFR 571; or 28
3. For any commercial motor vehicle (CMV), 29
follow the Federal Motor Carrier Safety Regulations or similar 30
applicable Mississippi regulations; 31
(ii) A motor vehicle originally equipped so that 32
the vehicle may be propelled by compressed natural gas, liquefied 33
natural gas, liquefied petroleum gas or propane gas, but only to 34
the extent of the portion of the basis of the motor vehicle which 35
is attributable to the storage of such fuel, the delivery to the 36
engine of the motor vehicle of such fuel, and the exhaust of gases 37
from combustion of such fuel; 38
(iii) Property, not including a building and its 39
structural components, which is either: 40
1. Related directly to the delivery of 41
compressed natural gas, liquefied natural gas or liquefied 42
petroleum gas for commercial purposes or for a fee or charge, into 43
the fuel tank of a motor vehicle propelled by such fuel, including 44
compression equipment and storage tanks for such fuel at the point 45
where the fuel is delivered, but only if the property is not used 46
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to deliver such fuel into any other type of storage tank or 47
receptacle and the fuel is not used for any purpose other than to 48
propel a motor vehicle; or 49
2. A metered-for-fee, public access 50
recharging system for motor vehicles propelled, in whole or in 51
part, by electricity. The property covered by this item 2 must be 52
new and must not have been installed previously or used previously 53
to refuel vehicles powered by compressed natural gas, liquefied 54
natural gas, liquefied petroleum gas, propane gas or electricity; 55
or 56
(iv) Property that is related directly to the 57
compression and delivery of natural gas from a private home or 58
residence, for noncommercial purposes, into the fuel tank of a 59
motor vehicle propelled by compressed natural gas. The property 60
covered by this subparagraph (iv) must be new and must not have 61
been installed previously or used previously to refuel vehicles 62
powered by natural gas. 63
(b) "Motor vehicle" means a motor vehicle originally 64
designed by the manufacturer to operate lawfully and principally 65
on streets and highways. 66
(2) There shall be allowed a one-time credit against the 67
income tax imposed by this chapter for investments in qualified 68
clean-burning motor vehicle fuel property. 69
(3) The credit provided for in subsection (2) of this 70
section shall be as follows: 71
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(a) For the qualified clean-burning motor vehicle fuel 72
property defined in subsection (1)(a)(i) or, subsection (1)(a)(ii) 73
of this section, fifty percent (50%) of the cost of the qualified 74
clean-burning motor vehicle fuel property. 75
(b) For qualified clean-burning motor vehicle fuel 76
property defined in subsection (1)(a)(iii) of this section, a 77
per-location credit of seventy-five percent (75%) of the cost of 78
the qualified clean-burning motor vehicle fuel property. 79
(c) For qualified clean-burning motor vehicle fuel 80
property defined in subsection (1)(a)(iv) of this section, a 81
per-location credit of the lesser of fifty percent (50%) of the 82
cost of the qualified clean-burning motor vehicle fuel property or 83
Two Thousand Five Hundred Dollars ($2,500.00). 84
(4) In cases where no credit has been claimed under 85
subsection (3)(a) of this section by any prior owner and in which 86
a motor vehicle is purchased by a taxpayer with qualified 87
clean-burning motor vehicle fuel property installed by the 88
manufacturer of the motor vehicle and the taxpayer is unable or 89
elects not to determine the exact basis that is attributable to 90
such property, the taxpayer may claim a credit in an amount not 91
exceeding the lesser of ten percent (10%) of the cost of the motor 92
vehicle or Two Thousand Five Hundred Dollars ($2,500.00). 93
(5) If the tax credit allowed under this section exceeds the 94
amount of income taxes due or if there are no state income taxes 95
due on the income of the taxpayer, the amount of the credit not 96
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used as an offset against the income taxes of a taxable year may 97
be carried forward as a credit against subsequent income tax 98
liability for a period not to exceed five (5) years. 99
(6) A husband and wife who file separate returns for a 100
taxable year in which they could have filed a joint return may 101
each claim only one-half (1/2) of the tax credit that would have 102
been allowed for a joint return. 103
(7) The Department of Revenue is empowered to promulgate 104
rules by which the purpose of this section shall be administered, 105
including the power to establish and enforce penalties for 106
violations of this section. 107
SECTION 2. Section 1 of this act shall be codified as a new 108
section in Chapter 7, Title 27, Mississippi Code of 1972. 109
SECTION 3. Nothing in this act shall affect or defeat any 110
claim, assessment, appeal, suit, right or cause of action for 111
taxes due or accrued under the income tax laws before the date on 112
which this act becomes effective, whether such claims, 113
assessments, appeals, suits or actions have been begun before the 114
date on which this act becomes effective or are begun thereafter; 115
and the provisions of the income tax laws are expressly continued 116
in full force, effect and operation for the purpose of the 117
assessment, collection and enrollment of liens for any taxes due 118
or accrued and the execution of any warrant under such laws before 119
the date on which this act becomes effective, and for the 120
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ST: Income tax; authorize credit for
investments in qualified clean-burning motor
vehicle fuel property.
imposition of any penalties, forfeitures or claims for failure to 121
comply with such laws. 122
SECTION 4. This act shall take effect and be in force from 123
and after January 1, 2026. 124