MISSISSIPPI LEGISLATURE
2019 Regular Session
To: Ways and Means
By: Representatives Lamar, McGee, White, Bell (21st), Hughes, Steverson, Miles, Shanks, Powell, Corley
AN ACT TO PROVIDE THAT THE GROSS INCOME OF RECENT GRADUATES OF FOUR-YEAR COLLEGES AND UNIVERSITIES IN MISSISSIPPI AND OUTSIDE MISSISSIPPI WHICH IS DERIVED FROM EMPLOYMENT IN A QUALIFYING JOB IN THIS STATE SHALL BE ALLOWED AS A DEDUCTION FROM GROSS INCOME UNDER THE STATE INCOME TAX LAW; TO DEFINE CERTAIN TERMS USED IN THE ACT; TO PROVIDE THAT THE DEDUCTION FROM GROSS INCOME AUTHORIZED BY THIS ACT MAY BE UTILIZED BY A RECENT GRADUATE FOR THREE CONSECUTIVE YEARS IF THE RECENT GRADUATE REMAINS A RESIDENT OF MISSISSIPPI AND EMPLOYED IN A QUALIFYING JOB FOR THAT PERIOD OF TIME; TO PROVIDE THAT A RECENT GRADUATE MAY UTILIZE THE DEDUCTION FROM GROSS INCOME FOR AN ADDITIONAL TWO YEARS IF THE RECENT GRADUATE PURCHASES PROPERTY IN THIS STATE FOR RESIDENTIAL OR COMMERCIAL USE BY THE RECENT GRADUATE, ESTABLISHES A BUSINESS IN THIS STATE THAT IS REGISTERED WITH THE SECRETARY OF STATE AND HAS AT LEAST ONE EMPLOYEE, OTHER THAN THE RECENT GRADUATE, WHOSE WAGES ARE SUBJECT TO INCOME TAX WITHHOLDING UNDER THE STATE INCOME TAX LAW, OR SERVES IN AN INSTRUCTIONAL CAPACITY AS A LICENSED TEACHER IN A PUBLIC SCHOOL OR NONPUBLIC SCHOOL; TO AMEND SECTION 27-7-18, MISSISSIPPI CODE OF 1972, IN CONFORMITY TO THE PROVISIONS OF THIS ACT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. (1) As used in this section, the following words and phrases have the meanings ascribed in this section unless the context clearly indicates otherwise:
(a) "College or university" means (i) any of the state institutions of higher learning listed in Section 37-101-1, (ii) any regionally accredited, nonprofit four-year college or university located in the State of Mississippi, or (iii) any such institution of learning or regionally accredited four-year college or university located outside the State of Mississippi.
(b) "Qualifying job" means employment in the State of Mississippi.
(c) "Recent graduate" means a resident of the State of Mississippi who has been awarded a baccalaureate degree and/or post graduate degree from a college or university no more than one (1) year preceding January 1 of the first calendar year for which the recent graduate claims a deduction under this section.
(2) A recent graduate may deduct from his or her gross income the gross income of the recent graduate derived from employment in a qualifying job. Except as otherwise provided in this section, the deduction from gross income authorized by this section may be utilized by a recent graduate for three (3) consecutive years if the recent graduate remains a resident of this state and employed in a qualifying job for that period of time. However, the deduction from gross income may be utilized by the recent graduate for an additional two (2) years if, in addition to remaining a resident of this state and employed in a qualifying job for that period of time, the recent graduate (a) purchases property in this state for residential or commercial use by the recent graduate, (b) establishes a business in this state that is registered with the Secretary of State and has at least one (1) employee, other than the recent graduate, whose wages are subject to the Mississippi Income Tax Withholding Law of 1968 and/or (c) serves in an instructional capacity as a licensed teacher in a public school or nonpublic school as defined in Section 37-13-91. The maximum aggregate amount of deductions that may be claimed by all taxpayers claiming a deduction under this section in a taxable year shall not exceed One Hundred Million Dollars ($100,000,000.00).
(3) The Department of Revenue shall have all powers necessary to implement and administer the provisions of this section, and the department shall promulgate rules and regulations, in accordance with the Mississippi Administrative Procedures Law, necessary for the implementation of this section.
SECTION 2. Section 27-7-18, Mississippi Code of 1972, is amended as follows:
27-7-18. (1) Alimony payments. In the case of a person described in Section 27-7-15(2)(e), there shall be allowed as a deduction from gross income amounts paid as periodic payments to the extent of such amounts as are includible in the gross income of the spouse as provided in Section 27-7-15(2)(e), payment of which is made within the person's taxable year.
(2) Unreimbursed moving expenses incurred after December 31, 1994, are deductible as an adjustment to gross income in accordance with provisions of the United States Internal Revenue Code, and rules, regulations and revenue procedures thereunder relating to moving expenses, not in direct conflict with the provisions of the Mississippi Income Tax Law.
(3) Amounts paid after December 31, 1998, by a self-employed individual for insurance which constitute medical care for the taxpayer, his spouse and dependents, are deductible as an adjustment to gross income in accordance with provisions of the United States Internal Revenue Code, and rules, regulations and revenue procedures thereunder relating to such payments, not in direct conflict with the provisions of the Mississippi Income Tax Law.
(4) Contributions or payments to a Mississippi Affordable College Savings (MACS) Program account are deductible from gross income as provided in Section 37-155-113. Payments made under a prepaid tuition contract entered into under the Mississippi Prepaid Affordable College Tuition Program are deductible as provided in Section 37-155-17.
(5) (a) Unreimbursed travel expenses, lodging expenses and lost wages an individual incurred as a result of, and related to, the donation, while living, of one or more of his or her organs for human organ transplantation, are deductible from gross income. The deduction from gross income authorized by this subsection may be claimed for only once and may not exceed Ten Thousand Dollars ($10,000.00).
(b) As used in this subsection, "organ" means all or part of a liver, pancreas, kidney, intestine, lung or bone marrow.
(6) In the case of a self-employed individual, there shall be allowed as a deduction from gross income an amount equal to:
(a) Seventeen percent (17%) of the federal self-employment taxes imposed on such individual for taxable years ending in calendar year 2017;
(b) Thirty-four percent (34%) of the federal self-employment taxes imposed on such individual for taxable years ending in calendar year 2018; and
(c) Fifty percent (50%) of the federal self-employment taxes imposed on such individual for taxable years ending in calendar year 2019 and thereafter.
(7) Contributions or payments to a Mississippi Achieving a Better Life Experience (ABLE) Program account are deductible from gross income as provided in Section 43-28-13.
(8) Gross income of a recent graduate derived from employment in a qualifying job is deductible from gross income as provided in Section 1 of this act. For the purposes of this subsection (8), the terms "recent graduate" and "qualifying job" mean and have the same definitions as such terms have in Section 1 of this act.
SECTION 3. A college or university described in Section 1(1)(a)(i) or (ii) of this act must develop a policy and procedure for making information available to students regarding the availability of the income tax deduction provided in Section 1 of this act.
SECTION 4. Section 1 of this act shall be codified as a new section in Chapter 7, Title 27, Mississippi Code of 1972.
SECTION 5. This act shall take effect and be in force from and after January 1, 2019.