TAX CREDITS

Jobs Tax Credit:  Businesses that locate or expand in a Tier 3 county and create at least 10 new jobs may receive a non-refundable and non-transferable corporate income tax credit.  In more developed counties, the minimum job creation threshold to qualify for the program increases to 15 jobs in a Tier 2 county and 20 jobs in a Tier 1 county.   The credit is calculated as a percentage of eligible payroll and ranges from 2.5% to 10% of payroll depending on the tier level of the county where the project is located.  Credits may be claimed for 5 years and can be used to offset up to 50% of a company’s tax liability in a given year.  Unused credits may be carried forward for up to 5 years.

Businesses also have the option of monetizing the tax credit for job training purposes.  Should a company elect to monetize the credit; the Mississippi Development Authority (MDA) will issue a grant to a two-year college or state university to support job training and retaining.  The grant will cover up to 75% of training costs with a maximum incentive of $1,000 per job in Tier 1 counties, $1,500 per job in Tier 2 counties and $2,000 per job in Tier 3 counties.

National or Regional Headquarters Tax Credit: Businesses that establish a national or regional corporate headquarters in Mississippi may receive a tax credit of $500-$2,000 for each full-time job created.  The actual credit will be based on the wage levels of the newly created jobs. A minimum of 20 new headquarters jobs must be created to be eligible for the credit which can be used to offset up to 50% of a company’s tax liability in a given year.  Unused credits may be carried forward for up to 5 years.

Research and Development Skills Tax Credit: Tax credits equal to $1,000 per employee per year for a 5 year period may be claimed by a business for any position that requires research or development skills. Unused credits may be carried forward for up to 5 years.

Manufacturing Investment Tax Credit:  To support the retention and expansion of manufacturers, Mississippi offers an investment tax credit to companies that have maintained a manufacturing facility in the state for at least 2 years.  To qualify, a business must invest at least $1 million in buildings and/or equipment.  A corporate income tax credit equal to 5% of eligible investment may be awarded to qualifying manufacturers with a maximum available credit of $1 million per project. These non-refundable and non-transferable credits can be used to offset up to 50% of a company’s tax liability in a given year.  Unused credits may be carried forward for up to 5 years.

GRANTS

Job Protection Grant: This program provides incentives to companies in “at-risk industries” to encourage them to retain business operations in Mississippi.  Qualifying companies must have had operated a business facility in the state for at least 3 years and have had to eliminate jobs or are at risk of cutting jobs as a result of outsourcing.  Grants must be used to retain jobs and improve productivity. The value of the grants cannot exceed 50% of the project costs.

CASH REBATES

Advantage Jobs Incentive Program: Qualified businesses that create at least 25 jobs may receive a rebate equal to a percentage of a company’s payroll for up to 10 years. The amount of the rebate is equal to 90% of the actual state income taxes withheld from employees.  To qualify, a business must pay its employees an annual average wage that is 110% of the county average wage where the project is located or the state average wage, whichever is less.

SPECIAL ZONING

Growth and Prosperity (GAP) Program: Eligible businesses that create at least 10 jobs and locate or expand in one of 18 GAP-eligible counties that have been designated as economically distressed may receive a 10-year exemption from state income and franchise taxes.  Additional incentives include an exemption from real and business personal property taxes as well as sales and use taxes.

TAX EXEMPTIONS

Sales and Use Tax Exemptions: Exemptions are available for the materials used in some construction and expansion projects, machinery and equipment and some purchases made with bond proceeds. Exemptions are also available for eligible businesses that establish a national or regional headquarters in Mississippi.  In addition, aerospace, clean energy, and data center projects that meet certain job creation and capital investment requirements may receive exemptions and other incentives.

 

Last updated: May 2016

 


 
BIGGINS LACY SHAPIRO & COMPANY
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