MISSISSIPPI LEGISLATURE
2025 Regular Session
To: Ways and Means
By: Representative Hall
AN ACT TO AUTHORIZE AN INCOME TAX CREDIT AND CORPORATION FRANCHISE TAX CREDIT FOR FINANCIAL INSTITUTIONS FOR QUALIFIED LOANS OR QUALIFIED LONG-TERM INVESTMENTS MADE TO COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS THAT ARE CERTIFIED BY THE UNITED STATES DEPARTMENT OF THE TREASURY'S COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND; TO PROVIDE FOR THE AMOUNT OF THE CREDIT; TO AUTHORIZE AN INCOME TAX CREDIT AND CORPORATION FRANCHISE TAX CREDIT FOR FINANCIAL INSTITUTIONS FOR GRANTS, CONTRIBUTIONS, OR QUALIFIED LOW-RATE LOANS MADE TO COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS THAT ARE CERTIFIED BY THE UNITED STATES DEPARTMENT OF THE TREASURY'S COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS FUND; TO PROVIDE FOR THE AMOUNT OF THE CREDIT; TO DEFINE THE TERMS "FINANCIAL INSTITUTION", "QUALIFIED LOAN", "QUALIFIED LONG-TERM INVESTMENT" AND "QUALIFIED LOW-RATE LOAN" FOR PURPOSES OF THIS ACT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. (1) For the purposes of this section, the following words and phrases shall have the meanings ascribed in this subsection unless the context clearly indicates otherwise:
(b) "Qualified loan" means a loan that is at least two percent (2%) below the prime rate, as published by the Wall Street Journal at the time the loan is approved, that does not qualify as a qualified low-rate loan.
(c) "Qualified long-term investment" means an equity investment made for a period of more than five (5) years.
(d) "Qualified low-rate loan" means a loan that is at least four percent (4%) below the prime rate, as published by the Wall Street Journal at the time the loan is approved.
(2) (a) Except as otherwise provided in this subsection, a financial institution shall be allowed a credit against the taxes imposed under this chapter and Section 27-13-1 et seq., in an amount equal to either:
(ii) Three percent (3%) annually of the unpaid principal balance of a qualified loan made to a community development financial institution that is certified by the United States Department of the Treasury's Community Development Financial Institutions Fund as of December 31 of each year for the life of the loan or fifteen (15) years, whichever is earlier.
(b) The amount of credit that may be utilized by a taxpayer under this subsection in a taxable year shall be limited to an amount not to exceed the total tax liability of the taxpayer for the taxes imposed under this chapter and Section 27-13-1 et seq. for the taxable year. Any tax credit claimed under paragraph (a)(i) of this subsection but not used in any taxable year may be carried forward for fifteen (15) consecutive years from the close of the tax year in which the credits were earned.
(3) (a) Except as otherwise provided in this subsection, a financial institution shall be allowed a credit against the taxes imposed under this chapter and Section 27-13-1 et seq., in an amount equal to either:
(a) Ten percent (10%) of a grant, contribution, or qualified low-rate loan made to a community development financial institution that is certified by the United States Department of the Treasury's Community Development Financial Institutions Fund, or
(b) Five percent (5%) annually of the unpaid principal balance of a qualified low-rate loan made to a community development financial institution that is certified by the United States Department of the Treasury's Community Development Financial Institutions Fund as of December 31 of each year for the life of the loan or fifteen (15) years, whichever is earlier.
The amount of credit that may be utilized by a taxpayer under this subsection in a taxable year shall be limited to an amount not to exceed the total tax liability of the taxpayer for the taxes imposed under this chapter and Section 27-13-1 et seq. for the taxable year. Any tax credit claimed under paragraph (a)(i) of this subsection but not used in any taxable year may be carried forward for fifteen (15) consecutive years from the close of the tax year in which the credits were earned.
(4) The Department of Revenue shall have all powers necessary to implement and administer this section, and the department shall promulgate rules, in accordance with the Mississippi Administrative Procedures Law, as necessary for the implementation of this section.
SECTION 2. Section 1 of this act shall be codified as a new section in Chapter 7, Title 27, Mississippi Code of 1972.
SECTION 3. This act shall take effect and be in force from and after January 1, 2025.