Senate Bill 2988

AN ACT TO CREATE A NEW SECTION IN TITLE 27, CHAPTER 7, MISSISSIPPI CODE OF 1972, TO AUTHORIZE AN INCOME TAX CREDIT FOR VOLUNTARY CASH CONTRIBUTIONS BY INDIVIDUALS TO HABITAT FOR HUMANITY MISSISSIPPI CAPITAL AREA; TO LIMIT THE AMOUNT OF THE CREDIT; TO ALLOW EXCESS AMOUNTS OF THE CREDIT TO BE CARRIED FORWARD FOR FIVE CONSECUTIVE YEARS; TO PROVIDE THAT THE CREDIT AUTHORIZED BY THIS ACT IS IN LIEU OF CHARITABLE DEDUCTIONS TAKEN UNDER THE INTERNAL REVENUE CODE AND UTILIZED FOR STATE TAX PURPOSES; TO CREATE A NEW SECTION IN TITLE 27, CHAPTER 7, MISSISSIPPI CODE OF 1972, TO AUTHORIZE AN INCOME TAX CREDIT FOR VOLUNTARY CASH CONTRIBUTIONS BY BUSINESS ENTERPRISES TO HABITAT FOR HUMANITY MISSISSIPPI CAPITAL AREA; TO LIMIT THE AMOUNT OF THE CREDIT; TO ALLOW EXCESS AMOUNTS OF THE CREDIT TO BE CARRIED FORWARD FOR FIVE CONSECUTIVE YEARS; TO PROVIDE THAT THE CREDIT AUTHORIZED BY THIS ACT IS IN LIEU OF CHARITABLE DEDUCTIONS TAKEN UNDER THE INTERNAL REVENUE CODE AND UTILIZED FOR STATE TAX PURPOSES; AND FOR RELATED PURPOSES.

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

SECTION 1. (1) Except as provided in subsections (2) and (3) of this section, a credit is allowed against the taxes imposed by this chapter for voluntary cash contributions by the taxpayer during the taxable year to Habitat for Humanity Mississippi Capital Area, not to exceed:

(a) The lesser of Four Hundred Dollars ($400.00) or the amount of the contribution in any taxable year for a single individual or a head of household.

(b) The lesser of Eight Hundred Dollars ($800.00) or the amount of the contribution in any taxable year for a married couple filing a joint return.

(2) A husband and wife who file separate returns for a taxable year in which they could have filed a joint return may each claim only one-half (1/2) of the tax credit that would have been allowed for a joint return.

(3) If the allowable tax credit exceeds the taxes otherwise due under this chapter on the claimant's income, or if there are no taxes due under this chapter, the taxpayer may carry forward the amount of the claim not used to offset the taxes under this chapter for not more than five (5) consecutive taxable years' income tax liability.

(4) The credit allowed by this section is in lieu of a deduction pursuant to Section 170 of the Internal Revenue Code and taken for state tax purposes.

(5) Taxpayers taking a credit authorized by this section shall provide the amount of the contribution to the department on forms provided by the department.

(6) The aggregate amount of tax credits that may be awarded under this section in any calendar year shall not exceed One Million Dollars ($1,000,000.00).

(7) A taxpayer shall apply for credits with the department on forms prescribed by the department. In the application, the taxpayer shall certify to the department the dollar amount of the contributions made or to be made during the calendar year. Within thirty (30) days after the receipt of an application, the department shall allocate credits based on the dollar amount of contributions as certified in the application. However, if the department cannot allocate the full amount of credits certified in the application due to the limit on the aggregate amount of credits that may be awarded under this section in a calendar year, the department shall so notify the applicant within thirty (30) days with the amount of credits, if any, that may be allocated to the applicant in the calendar year. Once the department has allocated credits to a taxpayer, if the contribution for which a credit is allocated has not been made as of the date of the allocation, then the contribution must be made not later than sixty (60) days from the date of the allocation. If the contribution is not made within such time period, the allocation shall be cancelled and returned to the department for reallocation. Upon final documentation of the contributions, if the actual dollar amount of the contributions is lower than the amount estimated, the department shall adjust the tax credit allowed under this section.

(8) This section shall be repealed from and after January 1, 2028.

SECTION 2. (1) (a) The tax credit authorized in this section shall be available only to a taxpayer that is a business enterprise engaged in commercial, industrial or professional activities and operating as a corporation, limited liability company, partnership or sole proprietorship. Except as otherwise provided in this section, a credit is allowed against the taxes imposed by Sections 27-7-5, 27-15-103, 27-15-109 and 27-15-123 for voluntary cash contributions made by a taxpayer during the taxable year to Habitat for Humanity Mississippi Capital Area. The amount of credit that may be utilized by a taxpayer in a taxable year shall be limited to an amount not to exceed fifty percent (50%) of the total tax liability of the taxpayer for the taxes imposed by such sections of law. Any tax credit claimed under this section but not used in any taxable year may be carried forward for five (5) consecutive years from the close of the tax year in which the credits were earned.

(b) A contribution to Habitat for Humanity Mississippi Capital Area for which a credit is claimed under this section does not qualify for and shall not be included in any credit that may be claimed under Section 1 of this act.

(c) A contribution for which a credit is claimed under this section may not be used as a deduction by the taxpayer for state income tax purposes.

(2) Taxpayers taking a credit authorized by this section shall provide the amount of the contribution to the department on forms provided by the department.

(3) Tax credits authorized by this section that are earned by a partnership, limited liability company, S corporation or other similar pass-through entity shall be allocated among all partners, members or shareholders, respectively, either in proportion to their ownership interest in such entity or as the partners, members or shareholders mutually agree as provided in an executed document.

(4) A taxpayer shall apply for credits with the department on forms prescribed by the department. In the application, the taxpayer shall certify to the department the dollar amount of the contributions made or to be made during the calendar year. Within thirty (30) days after the receipt of an application, the department shall allocate credits based on the dollar amount of contributions as certified in the application. However, if the department cannot allocate the full amount of credits certified in the application due to the limit on the aggregate amount of credits that may be awarded under this section in a calendar year, the department shall so notify the applicant within thirty (30) days with the amount of credits, if any, that may be allocated to the applicant in the calendar year. Once the department has allocated credits to a taxpayer, if the contribution for which a credit is allocated has not been made as of the date of the allocation, then the contribution must be made not later than sixty (60) days from the date of the allocation. If the contribution is not made within such time period, the allocation shall be cancelled and returned to the department for reallocation. Upon final documentation of the contributions, if the actual dollar amount of the contributions is lower than the amount estimated, the department shall adjust the tax credit allowed under this section.

(5) The aggregate amount of tax credits that may be allocated by the department under this section during a calendar year shall not exceed Five Million Dollars ($5,000,000.00).

SECTION 3. Sections 1 and 2 of this act shall be codified in Title 27, Chapter 7, Mississippi Code of 1972.

SECTION 4. This act shall take effect and be in force from and after July 1, 2024.