Tax credits; authorize for business taxpayer contributions to certain charitable organizations.

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To: Finance
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Senator(s) Johnson

SENATE BILL NO. 2841

AN ACT TO AUTHORIZE A CREDIT AGAINST INCOME AND INSURANCE 1
PREMIUM TAXES FOR VOLUNTARY CASH CONTRIBUTIONS BY CERTAIN BUSINESS 2
ENTERPRISES TO CERTAIN TAX-EXEMPT ORGANIZATIONS OPERATING AS 3
MEMBERS OF A STATEWIDE ALLIANCE, OFFERING PROGRAMS TO ADVANCE 4
MISSISSIPPI YOUTH IN EDUCATION ACHIEVEMENT, PHYSICAL DEVELOPMENT 5
AND SOCIAL/EMOTIONAL DEVELOPMENT WHILE ALSO SUPPORTING WORKFORCE 6
DEVELOPMENT; TO AUTHORIZE A CREDIT AGAINST AD VALOREM TAXES ON 7
REAL PROPERTY FOR SUCH CONTRIBUTIONS BY CERTAIN BUSINESS 8
ORGANIZATIONS NOT OPERATING AS CORPORATIONS; TO LIMIT THE AMOUNT 9
OF THE CREDITS; TO ALLOW EXCESS AMOUNTS OF THE CREDIT TO BE 10
CARRIED FORWARD FOR FIVE CONSECUTIVE YEARS; AND FOR RELATED 11
PURPOSES. 12
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 13
SECTION 1. (1) For the purposes of this section, the 14
following words and phrases shall have the meanings ascribed in 15
this section unless the context clearly indicates otherwise: 16
(a) "Department" means the Department of Revenue. 17
(b) "Eligible charitable organization" means an 18
organization that is exempt from federal income taxation under 19
Section 501(c)(3) of the Internal Revenue Code and is consistently 20
providing programs that advance Mississippi youth in education 21
achievement, physical development and social/emotional development 22
while also supporting workforce development. 23
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(2) (a) The tax credit authorized in this section shall be 24
available only to a taxpayer that is a business enterprise engaged 25
in commercial, industrial or professional activities and operating 26
as a corporation, limited liability company, partnership or sole 27
proprietorship. Except as otherwise provided in this section, a 28
credit is allowed against the taxes imposed by Sections 27-7-5, 29
27-15-103, 27-15-109 and 27-15-123, for voluntary cash 30
contributions made by a taxpayer during the taxable year to an 31
eligible charitable organization. A credit is also allowed 32
against ad valorem taxes assessed and levied on real property for 33
voluntary cash contributions made by the taxpayer during the 34
taxable year to an eligible charitable organization. The amount 35
of credit that may be utilized by a taxpayer in a taxable year 36
shall be limited to (i) an amount not to exceed fifty percent 37
(50%) of the total tax liability of the taxpayer for the taxes 38
imposed by Sections 27-7-5, 27-15-103, 27-15-109 and 27-15-123, 39
and (ii) an amount not to exceed fifty percent (50%) of the total 40
tax liability of the taxpayer for ad valorem taxes assessed and 41
levied on real property. Any credit claimed under this section 42
but not used in the tax year in which it was earned may be carried 43
forward for five (5) consecutive years from the close of the tax 44
year in which it was earned. 45
(b) A contribution for which a credit is claimed under 46
this section may not be used as a deduction by the taxpayer for 47
state income tax purposes. 48
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(3) A taxpayer taking a credit authorized by this section 49
shall provide the name of the eligible charitable organization and 50
the amount of the contribution to the department on forms provided 51
by the department. 52
(4) To be considered an eligible charitable organization 53
under this section, an organization shall provide the department 54
with a written certification that it meets all criteria. The 55
organization shall also notify the department of any changes that 56
may affect eligibility under this section. 57
(5) The eligible charitable organization's written 58
certification must be signed by an officer of the organization 59
under penalty of perjury. The written certification shall include 60
the following: 61
(a) Verification of the organization's status under 62
Section 501(c)(3) of the Internal Revenue Code; 63
(b) A statement that the organization will use the 64
contribution only for support of programs that advance Mississippi 65
youth in education achievement, physical development and 66
social/emotional development while also supporting workforce 67
development; and 68
(c) Any other information that the department requires 69
in order to administer this section. 70
(6) The department shall review each written certification 71
and determine whether the organization meets all the criteria to 72
be considered an eligible charitable organization and shall notify 73
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the organization of its determination. The department may also 74
periodically request recertification from the organization. The 75
department shall compile and make available to the public a list 76
of eligible charitable organizations. 77
(7) Tax credits authorized by this section that are earned 78
by a partnership, limited liability company, S corporation or 79
other similar pass-through entity, shall be allocated among all 80
partners, members or shareholders, respectively, either in 81
proportion to their ownership interest in such entity or as the 82
partners, members or shareholders mutually agree as provided in an 83
executed document. 84
(8) (a) A taxpayer shall apply for credits with the 85
department on forms prescribed by the department. In the 86
application, the taxpayer shall certify to the department the 87
dollar amount of the contributions made or to be made during the 88
calendar year. Within thirty (30) days after the receipt of an 89
application, the department shall allocate credits based on the 90
dollar amount of contributions as certified in the application. 91
However, if the department cannot allocate the full amount of 92
credits certified in the application due to the limit on the 93
aggregate amount of credits that may be awarded under this section 94
in a calendar year, the department shall so notify the applicant 95
within thirty (30) days with the amount of credits, if any, that 96
may be allocated to the applicant in the calendar year. Once the 97
department has allocated credits to a taxpayer, if the 98
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contribution for which a credit is allocated has not been made as 99
of the date of the allocation, then the contribution must be made 100
not later than sixty (60) days from the date of the allocation. 101
If the contribution is not made within such time period, the 102
allocation shall be cancelled and returned to the department for 103
reallocation. Upon final documentation of the contribution, if 104
the actual dollar amount of the contribution is lower than the 105
amount estimated, the department shall adjust the tax credit 106
allowed under this section. 107
(b) For the purposes of using a tax credit against ad 108
valorem taxes assessed and levied on real property, a taxpayer 109
shall present to the appropriate tax collector the tax credit 110
documentation provided to the taxpayer by the department, and the 111
tax collector shall apply the tax credit against such ad valorem 112
taxes. The tax collector shall forward the tax credit 113
documentation to the department along with the amount of the tax 114
credit applied against ad valorem taxes, and the department shall 115
disburse funds to the tax collector for the amount of the tax 116
credit applied against ad valorem taxes. Such payments by the 117
department shall be made from current tax collections. 118
(9) The aggregate amount of tax credits that may be 119
allocated by the department under this section during a calendar 120
year shall not exceed Two Hundred Fifty Thousand Dollars 121
($250,000.00). 122
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ST: Tax credits; authorize for business
taxpayer contributions to certain charitable
organizations.
SECTION 2. Section 1 of this act shall be codified as a new 123
section in Chapter 7, Title 27, Mississippi Code of 1972. 124
SECTION 3. Nothing in this act shall affect or defeat any 125
claim, assessment, appeal, suit, right or cause of action for 126
taxes due or accrued under the income tax laws, insurance premium 127
tax laws or ad valorem tax laws before the date on which this act 128
becomes effective, whether such claims, assessments, appeals, 129
suits or actions have been begun before the date on which this act 130
becomes effective or are begun thereafter; and the provisions of 131
the income tax laws, insurance premium tax laws and ad valorem tax 132
laws are expressly continued in full force, effect and operation 133
for the purpose of the assessment, collection and enrollment of 134
liens for any taxes due or accrued and the execution of any 135
warrant under such laws before the date on which this act becomes 136
effective, and for the imposition of any penalties, forfeitures or 137
claims for failure to comply with such laws. 138
SECTION 4. This act shall take effect and be in force from 139
and after January 1, 2026. 140