MISSISSIPPI LEGISLATURE

1997 Regular Session

To: Finance

By: Senator(s) Bryan

Senate Bill 2964

(As Sent to Governor)

AN ACT TO AMEND SECTION 27-13-1, MISSISSIPPI CODE OF 1972, TO MAKE IT CLEAR THAT ORGANIZATIONS THAT ARE TREATED AS A CORPORATION FOR FEDERAL INCOME TAX PURPOSES SHALL BE TREATED AS A CORPORATION FOR PURPOSES OF THE FRANCHISE TAX LAW. 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 27-13-1, Mississippi Code of 1972, is amended as follows:

27-13-1. The words, terms and phrases when used in this chapter shall have the following meanings ascribed to them:

(a) "Commission" means the State Tax Commission of the State of Mississippi.

(b) "Commissioner" means the Chairman of the State Tax Commission.

(c) "Taxpayer" means any corporation, association or joint stock company liable for or having paid any tax to the State of Mississippi under the provisions of this chapter or any corporation, association or joint stock company subject to the provisions of this chapter.

(d) "Domestic," when applied to a corporation or association, means created or organized under the laws of the State of Mississippi.

(e) "Foreign," when applied to a corporation or association, means created or organized under some authority other than the laws of the State of Mississippi.

(f) "Accounting period" or "accounting year" means a period of twelve (12) months ending on the last day of the month of December, known as a calendar year, or a period of twelve (12) months ending on the last day of any month other than December, known as a fiscal year.

(g) "Corporation," "association" or "joint stock company" means and includes each and every form of organization for pecuniary gain, having authorized capital stock, whether with or without par value, having privileges not possessed by individuals or partnerships; and whether organized with or without statutory authority; and may be referred to as "organizations." When any form of organization is treated as a corporation for federal income tax purposes it shall be treated as a corporation for purposes of this chapter.

(h) "Doing business" means and includes each and every act, power or privilege, including any income-producing activities, exercised or enjoyed in this state as an incident to, or by virtue of, the powers and privileges acquired by the nature of such organization, whether the form of existence be corporate, associate, joint stock company or common law trust.

(i) "Holding corporation" means a corporation, association or joint stock company: (i) owning capital stock of one or more other corporations, associations or joint stock companies, which stock ownership represents at least eighty percent (80%) of the value and at least eighty percent (80%) of the combined voting power of all classes of issued and outstanding capital stock of such other corporation, association or joint stock company; except that for purposes of this definition the term "stock" does not include nonvoting stock which is limited and preferred as to dividends; and (ii) deriving at least ninety-five percent (95%) of its gross receipts from dividends, interest, royalties, rents, services provided to members of an affiliated group (as defined in Section 27-7-37(2)(d)) to the extent of the cost of providing such services, and from such additional sources as the commissioner may specify by regulation. The definition of the various sources of gross receipts referred to herein shall be governed by applicable provisions of Chapter 7, Title 27, Mississippi Code of 1972, and regulations thereunder and shall include only passive categories of receipts in the computation of gross receipts.

(j) "Subsidiary corporation" means a corporation, association or joint stock company of which at least eighty percent (80%) of the value and at least eighty percent (80%) of the combined voting power of all classes of its issued and outstanding capital stock is owned by a holding corporation, except that for purposes of this definition the term "stock" does not include nonvoting stock which is limited and preferred as to dividends.

(k) "Stock or securities" means any share of stock, certificate of stock, or interest in a corporation, note, bond, debenture, or evidence of indebtedness, or any evidence of an interest in or right to subscribe to or purchase any of the foregoing.

SECTION 2. This act shall take effect and be in force from and after its passage.