MISSISSIPPI LEGISLATURE

1997 Regular Session

To: Finance

By: Senator(s) Bryan

AN ACT TO PROVIDE THAT CERTAIN INCOME TAX CREDITS SHALL BE LIMITED TO THE INCOME TAX LIABILITIES DERIVED FROM THE BUSINESS INCOME WHICH GENERATED THE CREDITS AND CANNOT BE APPLIED TO OTHER INCOME TAX LIABILITIES UNLESS SPECIFICALLY ALLOWED BY LAW; TO PROVIDE THAT INCOME TAX CREDITS FOR BUSINESSES THAT DO NOT PAY INCOME TAXES MAY BE PASSED TO THE OWNERS OF THE BUSINESS BUT THAT SUCH CREDIT IS LIMITED TO THE TAX LIABILITIES DERIVED FROM THE NET INCOME DIRECTLY ASSOCIATED WITH THE CREDIT UNLESS OTHERWISE PROVIDED BY LAW; AND FOR RELATED PURPOSES. 

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

SECTION 1. All credits against the taxes imposed pursuant to this chapter and authorized pursuant to Sections 27-7-22 through 27-7-22.13, Sections 57-73-21, 57-73-25 and 57-73-27 and any other similar credits, shall be limited to the income tax liabilities derived from the business income which generated the credits and cannot be applied to other income tax liabilities unless specifically allowed by law; provided, however, that credits for businesses that do not pay income taxes, including, but not limited to, Subchapter S corporations, partnerships and limited liability corporations, may be passed to the owners of the businesses on a pro rata basis, but such credits shall be limited to the tax liabilities derived from the net income directly associated with the credits unless otherwise provided by law.

SECTION 2. Section 1 of this act shall be codified in Chapter 7, Title 27, Mississippi Code of 1972.

SECTION 3. This act shall take effect and be in force from and after passage.