Department of Revenue; revise provisions regarding tax liens and compromise of doubtful claims.

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To: Ways and Means
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Representative Lamar

HOUSE BILL NO. 1486

AN ACT TO AMEND SECTION 85-11-21, MISSISSIPPI CODE OF 1972, 1
TO PROVIDE THE TIME WITHIN WHICH THE DEPARTMENT OF REVENUE MAY 2
TAKE ACTION TO COLLECT AGAINST A TAX LIEN FOR A FINALLY DETERMINED 3
TAX LIABILITY; TO AMEND SECTION 31-19-27, MISSISSIPPI CODE OF 4
1972, TO PROVIDE THAT A DOUBTFUL CLAIM IS A CLAIM FOR WHICH A 5
NOTICE OF TAX LIEN HAS BEEN ENROLLED IN THE UNIFORM STATE TAX LIEN 6
REGISTRY FOR A FINALLY DETERMINED TAX LIABILITY AND FOR WHICH THE 7
DEPARTMENT OF REVENUE IS PROHIBITED UNDER SECTION 85-11-21 FROM 8
TAKING ANY ACTION FOR COLLECTION AGAINST THE TAX LIEN FOR SUCH 9
LIABILITY; TO AMEND SECTION 31-19-30, MISSISSIPPI CODE OF 1972, TO 10
PROVIDE CERTAIN CRITERIA RELATING TO THE SETTLEMENT AND COMPROMISE 11
OF CERTAIN DOUBTFUL CLAIMS; AND FOR RELATED PURPOSES. 12
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 13
SECTION 1. Section 85-11-21, Mississippi Code of 1972, is 14
amended as follows: 15
85-11-21. All tax liens currently enrolled appearing on the 16
judgment rolls of the counties of this state as of January 1, 17
2015, and which the department does not show as satisfied or as 18
issued in error and which were last enrolled or reenrolled on the 19
judgment rolls within seven (7) years before January 1, 2015, 20
shall be immediately enrolled on the tax lien registry on January 21
1, 2015, and shall have the force and effect of a judgment on all 22
real and personal property belonging to the debtor anywhere in the 23
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state for a duration of seven (7) years effective from the date of 24
the enrollment on the tax lien registry unless and until such time 25
as either the notice of tax lien is released or the department 26
reenrolls the tax lien in the tax lien registry. However, for all 27
tax liens initially enrolled on the tax lien registry on or after 28
July 1, 2026, the department shall not take any action to collect 29
against a tax lien for a finally determined tax liability more 30
than three (3) years after the date that the tax lien for such 31
liability was initially enrolled on the tax lien registry. For 32
all tax liens initially enrolled and/or reenrolled on the tax lien 33
registry before July 1, 2026, and appearing on the tax lien 34
registry on such date, the department shall not take any action 35
after July 1, 2029, to collect against a tax lien for such a 36
finally determined tax liability. 37
SECTION 2. Section 31-19-27, Mississippi Code of 1972, is 38
amended as follows: 39
31-19-27. (1) A doubtful claim of the state, or of the 40
county, city, town, village, or levee board is one for which 41
judgment has been rendered and for the collection of which the 42
ordinary process of law has been ineffectual; debts due by 43
drainage districts or other taxing districts or sinking funds to 44
counties under the Rehabilitation Act of 1928, being Chapter 88, 45
Laws of 1928, and Chapter 16 of the Acts of the Special Session of 46
1931; those debts due counties by drainage districts, which the 47
Reconstruction Finance Corporation has heretofore refused to 48
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refinance; those debts due a municipal utility system as 49
authorized under Section 31-19-30; debts due for sixteenth section 50
township school fund loans made to churches, where the board of 51
supervisors finds that the value of the security given therefor is 52
insufficient or inadequate to pay or satisfy the principal and 53
interest of said loan, and when the church repays the principal of 54
said loan; and debts due by counties and townships to drainage 55
districts for drainage district assessments or taxes levied and 56
assessed upon sixteenth section lands. 57
(2) For the purposes of Section 31-19-30, a doubtful claim 58
is (a) one for which a notice of tax lien has been enrolled in the 59
Uniform State Tax Lien registry for a finally determined tax 60
liability and for the collection of which the ordinary process of 61
law has been ineffectual and/or (b) one for which a notice of tax 62
lien has been enrolled in the Uniform State Tax Lien registry for 63
a finally determined tax liability and for which the Department of 64
Revenue is prohibited under Section 85-11-21 from taking any 65
action for collection against the tax lien for such liability. 66
SECTION 3. Section 31-19-30, Mississippi Code of 1972, is 67
amended as follows: 68
31-19-30. (1) The Commissioner of Revenue shall develop 69
procedures for the receipt and consideration of offers to 70
compromise and settle doubtful claims as defined in Section 71
31-19-27. If the commissioner makes a determination that a 72
finally determined tax liability is a doubtful claim as defined in 73
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Section 31-19-27 and should be settled and compromised, that 74
recommendation shall be made to the Governor as provided in 75
Section 31-19-29. 76
(2) (a) Upon the advice of the Attorney General, the 77
Commissioner of Revenue is authorized to enter into an agreement 78
with a taxpayer under which a finally determined tax liability 79
that is a doubtful claim is settled and compromised. The 80
settlement agreement shall be binding and a taxpayer's liabilities 81
for taxes, interest and penalties will be fully and finally 82
compromised. If the Commissioner of Revenue later determines that 83
the taxpayer misrepresented, whether intentionally or not, the 84
financial condition of the taxpayer or any property belonging to 85
the taxpayer or other person liable for the tax, all compromised 86
liabilities may be reestablished without regard to any statute of 87
limitations that otherwise may be applicable. 88
(b) From and after July 1, 2026, the following 89
additional provisions apply to any doubtful claim as defined in 90
Section 31-19-27(2)(b) that is settled and compromised under this 91
section: 92
(i) For a doubtful claim for which a notice of tax 93
lien has been initially enrolled on the Uniform State Tax Lien 94
registry on or after July 1, 2026, and which has been so enrolled 95
for at least three (3) years but not more than ten (10) years 96
after the date that the tax lien for such liability was initially 97
enrolled on the tax lien registry, the amount required by the 98
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commissioner to compromise such claim shall not exceed fifty 99
percent (50%) of the taxpayer's liability for taxes, excluding 100
interest and penalties. If the notice of tax lien for the claim 101
has been so enrolled for at least ten (10) years after the date 102
that the tax lien for such liability was initially enrolled on the 103
tax lien registry, there shall be no amount required by the 104
commissioner and the claim shall be settled and compromised. 105
(ii) For a doubtful claim for which a notice of 106
tax lien was initially enrolled and/or reenrolled on the Uniform 107
State Tax Lien registry before July 1, 2026, and appearing on the 108
tax lien registry on such date, and which has been so enrolled for 109
at least ten (10) years before July 1, 2026, the amount required 110
by the commissioner to compromise such claim shall not exceed 111
twenty-five percent (25%) of the taxpayer's liability for taxes, 112
excluding interest and penalties. 113
Funds received by the Department of Revenue from the 114
settlement and compromise of doubtful claims under this paragraph 115
(b) shall be deposited into a special fund created in the State 116
Treasury and used by the department, upon appropriation by the 117
Legislature, for the purposes of reviewing claims that have become 118
doubtful claims as defined in Section 31-19-27(2)(b) and working 119
with taxpayers to settle and compromise such claims. 120
(3) The Commissioner of Revenue and the Department of 121
Revenue may discuss with and provide the Attorney General or his 122
designated representative with information related to an offer to 123
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ST: Department of Revenue; revise provisions
regarding tax liens and compromise of doubtful
claims.
compromise and settle any doubtful claim under this section. Such 124
discussions shall be subject to the confidentiality requirements 125
of Sections 27-3-73, 27-7-83, 27-13-57 and/or 27-65-81, as the 126
case may be. 127
(4) The Commissioner of Revenue shall have all powers 128
necessary to implement and administer this section, and shall 129
promulgate rules and regulations, in accordance with the 130
Mississippi Administrative Procedures Law, necessary for the 131
implementation of this section. 132
SECTION 4. This act shall take effect and be in force from 133
and after July 1, 2026. 134