MISSISSIPPI LEGISLATURE
2026 Regular Session
To: Ways and Means
By: Representative Steverson
AN ACT TO CREATE THE MISSISSIPPI WORK AND SAVE PROGRAM, WHICH IS A RETIREMENT SAVINGS PROGRAM SPONSORED BY THE STATE FOR CERTAIN EMPLOYERS WHO DO NOT ALREADY OFFER A RETIREMENT PLAN THAT WILL ALLOW THOSE EMPLOYERS TO OFFER ELIGIBLE EMPLOYEES THE CHOICE TO CONTRIBUTE TO AN INDIVIDUAL RETIREMENT ACCOUNT (IRA) THROUGH A PAYROLL DEDUCTION; TO PROVIDE THE POWERS, AUTHORITY AND DUTIES OF THE STATE TREASURER TO DESIGN, DEVELOP AND IMPLEMENT THE PROGRAM; TO PROVIDE THAT THE IRA TO WHICH CONTRIBUTIONS ARE MADE WILL BE A ROTH IRA AND THE STANDARD PACKAGE WILL BE A ROTH IRA WITH A TARGET DATE FUND INVESTMENT AND A SPECIFIED CONTRIBUTION PERCENTAGE; TO PROVIDE CERTAIN PROTECTION FROM LIABILITY FOR EMPLOYERS IN THE PROGRAM AND FOR THE STATE; TO PROVIDE FOR THE CONFIDENTIALITY OF PARTICIPANT AND ACCOUNT INFORMATION; TO CREATE THE MISSISSIPPI WORK AND SAVE ADMINISTRATIVE FUND AS A SPECIAL FUND IN THE STATE TREASURY FOR THE PURPOSES AUTHORIZED IN THIS ACT; TO AUTHORIZE THE ISSUANCE OF STATE GENERAL OBLIGATION BONDS TO PROVIDE FUNDS FOR THE MISSISSIPPI WORK AND SAVE ADMINISTRATIVE FUND; TO AMEND SECTION 27-7-15, MISSISSIPPI CODE OF 1972, TO REVISE THE DEFINITION OF THE TERM "GROSS INCOME" UNDER THE STATE INCOME TAX LAW TO EXCLUDE NIL COMPENSATION; TO AMEND SECTION 27-65-22, MISSISSIPPI CODE OF 1972, TO EXEMPT FROM SALES TAXATION ADMISSIONS CHARGED AT ANY ATHLETIC GAMES OR CONTESTS BETWEEN UNIVERSITIES OR COLLEGES; AND FOR RELATED PURPOSES.
WHEREAS, the Legislature finds that too many Mississippi citizens have no or inadequate savings for retirement, and many Mississippi working families, including employees, independent contractors, and the self-employed, have no access to an employer-sponsored retirement plan or program or any other easy way to save at work; and
WHEREAS, it is the policy of the state to assist the Mississippi private-sector workforce, particularly moderate- and lower-income working households, to voluntarily save for retirement, including by facilitating saving in individual retirement accounts (IRAs) and by encouraging employers to adopt retirement savings and other retirement plans for employees in the state; and
WHEREAS, more adequate, portable, low-cost and consumer-protective retirement saving by Mississippi households will enhance their retirement security and ultimately reduce the pressure on state public assistance programs for retirees and other elderly citizens and the potential burden on Mississippi taxpayers to finance such programs; and
WHEREAS, the Legislature establishes the Mississippi Work and Save Program to use the services of competent and qualified private-sector entities to administer the program and manage the funds on behalf of the program participants and that shall, to the extent necessary or desirable, endeavor to collaborate, cooperate, coordinate, contract and combine resources, investments and administrative functions with other entities, including retirement savings programs of other states that are compatible with the program, through contracts, agreements, memoranda of understanding, arrangements, partnerships or similar arrangements as appropriate to achieve economies of scale and other efficiencies designed to minimize costs for the program and its participants; and
WHEREAS, the Mississippi Affordable College Savings Program (MACS) has demonstrated the feasibility of a public-private partnership that outsources investment and administration to assist private citizens of the state to save on a voluntary and cost-efficient basis; NOW, THEREFORE,
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Title. This act shall be known and may be cited as the Mississippi Work and Save Program.
SECTION 2. Definitions. For purposes of this act, the following terms have the meanings as defined in this section, unless the context clearly indicates otherwise:
(a) "Covered employee" means an individual who is employed by a covered employer, who has wages or other compensation that is allocable to the state, who is at least eighteen (18) years of age, and who voluntarily participates in the program. The term "covered employee" does not include:
(i) Any employee covered under the federal Railway Labor Act (45 USC Section 151).
(ii) Any employee on whose behalf an employer makes contributions to a Taft-Hartley multiemployer pension trust fund.
(iii) Any individual who is an employee of the federal government, the state or any other state, any county or municipality, or any of the state's, any other state's, or the federal government's units or instrumentalities.
(b) "Covered employer" means a person or entity engaged in a business, industry, profession, trade or other enterprise in the state, whether for profit or not for profit, excluding the federal government, the state, any county, any municipal corporation, or any of the state's or the federal government's units or instrumentalities, and that voluntarily participate in the program. The term "covered employer" does not include an employer that maintains a specified tax-favored retirement plan for its employees or has done so effective in form and operation at any time within the current or two (2) preceding calendar years. If an employer does not maintain a specified tax-favored retirement plan for a portion of a calendar year ending on or after July 1, 2026, and adopts such a plan effective for the remainder of that calendar year, the employer is exempt from "covered employer" status for that remainder of the year.
(c) "ERISA" means the Employee Retirement Income Security Act of 1974, as amended (29 USC Section 1001 et seq.).
(d) "Internal Revenue Code" means the Internal Revenue Code of 1986, as amended (Title 26 of the United States Code).
(e) "IRA" means a traditional or Roth individual retirement account or individual retirement annuity under Section 408(a), 408(b) or 408A of the Internal Revenue Code.
(f) "Mississippi Work and Save Administrative Fund" or "fund" is the fund established in Section 10 of this act.
(g) "Mississippi Work and Save Program" or "program" means the retirement savings program established by this act.
(h) "Participant" means an individual who is contributing to an IRA under the program or has an IRA account balance under the program.
(i) "Participating employer" means a covered employer that provides for covered employees a payroll deduction IRA provided for by this act.
(j) "Payroll deduction IRA arrangement" or "payroll deduction IRA" means an arrangement by which an employer allows employees to contribute to an IRA through payroll deduction.
(k) "Roth IRA" means a Roth individual retirement account or individual retirement annuity under Section 408A of the Internal Revenue Code.
(l) "Specified tax-favored retirement plan" means a retirement plan that is tax-qualified under or is described in and satisfies the requirements of Section 401(a), 401(k), 403(a), 403(b), 408(k)(Simplified Employee Pension) or 408(p)(SIMPLE-IRA) of the Internal Revenue Code.
(m) "Total fees and expenses" means all fees, costs and expenses, including, but not limited to, administrative expenses, investment expenses, investment advice expenses, accounting costs, actuarial costs, legal costs, marketing expenses, education expenses, trading costs, insurance annuitization costs, and other miscellaneous costs.
(n) "Traditional IRA" means a traditional individual retirement account or traditional individual retirement annuity under Section 408(a) or (b) of the Internal Revenue Code.
(o) "Trust" means the trust in which the assets of the program are held. Where applicable, except as otherwise specified, references throughout this act to the program generally are intended to refer also to the trust (including the assets, facilities, costs and expenses, receipts, expenditures, activities, operations, administration or management of the trust).
SECTION 3. Powers, authority, and duties of the State Treasurer. (1) The State Treasurer shall design, develop and implement the program and, to that end, may conduct market, legal and feasibility analyses.
(2) The State Treasurer shall:
(a) Cause the program, trust and arrangements and accounts established under the program to be designed and operated:
(i) In accordance with best practices for retirement saving vehicles;
(ii) To encourage participation, saving, sound investment practices, and appropriate selection of investment options, including any default investments;
(iii) To maximize simplicity and ease of administration for covered employers;
(iv) To minimize costs, including by collective investment and other measures to achieve economies of scale and other efficiencies in program design and administration;
(v) To promote portability of benefits; and
(vi) To avoid preemption of the program by federal law;
(b) Arrange for collective, common and pooled investment of assets of the program and trust, including investments in conjunction with other funds with which these assets are permitted by law to be collectively invested, with a view to achieving economies of scale and other efficiencies designed to minimize costs for the program and its participants;
(c) Develop and disseminate information designed to educate participants and citizens about the benefits of planning and saving for retirement and information to help them decide the level of participation and savings strategies that may be appropriate for them, including information to increase financial capability and financial literacy;
(d) If necessary, determine the eligibility of an employer, employee or other individual to participate in the program;
(e) Adopt rules and regulations necessary or advisable for the implementation of this act and the administration and operation of the program consistent with the Internal Revenue Code and regulations thereunder, including to ensure that the program and arrangements established under the program satisfy all criteria for favorable federal tax treatment and comply, to the extent necessary, with any other applicable federal or state law;
(f) Arrange for and facilitate compliance by the program or arrangements established under the program with all applicable requirements for the program under the Internal Revenue Code, including requirements for favorable tax treatment of the IRAs, and under any other applicable federal or state law and accounting requirements, including using its best efforts to implement procedures minimizing the risk that covered employees will contribute more to an IRA than the amount they are eligible for under the Internal Revenue Code to contribute to the IRA on a tax-favored basis, and otherwise providing or arranging for assistance to covered employers and covered employees in complying with applicable law and tax-related requirements in a cost-effective manner. The State Treasurer may establish any processes that he or she reasonably deems necessary or advisable to verify whether an employer is a covered employer (including reference to online data and possible use of questions in employer state tax filings);
(g) Employ or retain a program administrator, executive director, staff, trustee, recordkeeper, investment managers, investment advisors, other administrative, professional, expert advisors and service providers, and determine their duties and compensation. The State Treasurer may authorize the executive director and other officials to oversee requests for proposals or other public competitions and enter into contracts. The State Treasurer may authorize the executive director to enter into contracts, as described in paragraph (m) of this subsection (2), on behalf of the State Treasurer or conduct any business necessary for the efficient operation of the program;
(h) Establish procedures for the timely and fair resolution of participant and other disputes related to accounts or program operation;
(i) Develop and implement an investment policy that defines the program's investment objectives, consistent with the objectives of the program, and that provides for policies and procedures consistent with those investment objectives. The State Treasurer shall designate appropriate default investments that include a mix of asset classes, such as target date and balanced funds. The State Treasurer shall seek to minimize participant fees and expenses of investment and administration. The State Treasurer shall strive to design and implement investment options available to holders of accounts established as part of the program and other program features that are intended to achieve maximum possible income replacement balanced with an appropriate level of risk in an IRA-based environment consistent with the investment objectives under the policy. The investment options may encompass a range of risk and return opportunities and allow for a rate of return commensurate with an appropriate level of risk in view of the investment objectives under the policy. The menu of investment options shall be determined taking into account the nature and objectives of the program, the desirability (based on behavioral research findings) of limiting investment choices under the program to a reasonable number, and the extensive investment choices available to participants if they roll over to an IRA outside the program. In accordance with paragraph (g) of this subsection (2), the State Treasurer, to the extent he or she deems it necessary or advisable, in carrying out his or her responsibilities and exercising his powers under this and other paragraphs and provisions of this act, shall employ or retain appropriate entities or personnel to assist or advise him or her or to whom to delegate the carrying out of such responsibilities and exercise of such powers;
(j) Discharge his or her duties as a fiduciary with respect to the program solely in the interest of the participants as follows:
(i) For the exclusive purpose of providing benefits to participants and defraying reasonable expenses of administering the program; and
(ii) With the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in a like capacity and familiar with those matters would use in the conduct of an enterprise of a like character and with like aims;
(k) Cause expenses incurred to initiate, implement, maintain and administer the program to be paid from contributions to, or investment returns or assets of, the program or other money collected by or for the program or pursuant to arrangements established under the program to the extent permitted under federal and state law;
(l) Collect application, account or administrative fees and accept any grants, gifts, legislative appropriation, loans and other monies from the state, any unit of federal, state or local government, or any other person, firm or entity to defray the costs of administering and operating the program;
(m) Make and enter into competitively procured contracts, agreements, memoranda of understanding, partnerships or other arrangements, to collaborate and cooperate with, and to retain, employ and contract with or for any of the following to the extent necessary or desirable, for the effective and efficient design, implementation and administration of the program consistent with the purposes set forth in this act and to maximize outreach to covered employers and covered employees:
(i) Services of private and public financial institutions, depositories, consultants, actuaries, counsel, auditors, investment advisors, investment administrators, investment management firms, other investment firms, third-party administrators, other professionals and service providers, and state public retirement systems;
(ii) Research, technical, financial, administrative and other services; and
(iii) Services of other state agencies to assist the State Treasurer in the exercise of his or her powers and duties;
(n) Make and enter into contracts, agreements, memoranda of understanding, partnerships or other arrangements to collaborate, cooperate, coordinate, contract or combine resources, investments or administrative functions with other governmental entities, including states or their agencies or instrumentalities that maintain or are establishing retirement savings programs compatible with the program, including collective, common or pooled investments with other funds of other states' programs with which the assets of the program and trust are permitted by law to be collectively invested, to the extent necessary or desirable for the effective and efficient design, administration and implementation of the program consistent with the purposes set forth in this act, including the purpose of achieving economies of scale and other efficiencies designed to minimize costs for the program and its participants and the provisions of Section 4(j) and (l) of this act.
(o) Develop and implement an outreach plan to gain input and disseminate information regarding the program and retirement savings in general, including timely information to covered employers regarding the program and how it applies to them, with special emphasis on their ability at any time to sponsor a specified tax-favored retirement plan that would exempt them from any responsibilities under the program;
(p) Cause monies to be held and invested and reinvested under the program;
(q) Ensure that all contributions to IRAs under the program may be used only to:
(i) Pay benefits to participants under the program;
(ii) Pay the cost of administering the program; and
(iii) Make investments for the benefit of the program, and that no assets of the program or trust are transferred to the State General Fund or to any other fund of the state or are otherwise encumbered or used for any purpose other than those specified in this subsection (2);
(r) Make provision for the payment of costs of administration and operation of the program and trust;
(s) Consider whether or not procedures should be promulgated to allow employers that are not covered employers because they are exempt from covered employer status to voluntarily participate in the program by enrolling their employees in payroll deduction IRAs, taking into account, among other considerations, the potential legal consequences and the degree of employer demand to participate or facilitate participation by employees;
(t) Evaluate the need for, and procure if and as needed, insurance against any and all loss in connection with the property, assets or activities of the program, and evaluate the need for, and procure if and as deemed necessary, pooled private insurance;
(u) Indemnify, including through the procurement of insurance if and as needed for this purpose, the State Treasurer from personal loss or liability resulting from his or her action or inaction;
(v) Collaborate with, and evaluate the role of, financial advisors or other financial professionals, including in assisting and providing guidance for covered employees; and
(w) Carry out his or her powers and duties under the program pursuant to this act and exercise any and all other powers as are appropriate for the effectuation of the purposes, objectives and provisions of this act pertaining to the program.
(3) The State Treasurer and his or her staff shall not:
(a) Directly or indirectly have any interest in the making of any investment under the program or in gains or profits accruing from any such investment;
(b) Borrow any program-related funds or deposits, or use any such funds or deposits in any manner, for himself or herself or as an agent or partner of others; or
(c) Become an endorser, surety or obligor on investments made under the program.
SECTION 4. Requirements for the Mississippi Work and Save Program. The program developed and established under this act must:
(a) Allow eligible individuals in the state to choose whether or not to contribute to an IRA under the program, including allowing covered employees in the state the choice to contribute to an IRA through payroll deduction under the program;
(b) Allow each covered employer to offer its employees to choose whether or not to contribute to a payroll deduction IRA by permitting automatic enrollment where employees may opt-out of participation;
(c) Provide that the IRA to which contributions are made will be a Roth IRA, except that the State Treasurer shall have the authority at any time, to add an option for all participants to affirmatively elect to contribute to a traditional IRA as an alternative to the Roth IRA;
(d) Provide that the standard package shall be a Roth IRA with a target date fund investment, and a contribution rate that begins at five percent (5%) of salary or wages (unless the State Treasurer in regulations specifies three percent (3%), four percent (4%), or six percent (6%)), provided that the covered employee can choose to stop participation altogether, to use a traditional IRA and a different investment from among the options available, and to contribute at a higher or lower contribution rate, subject to the IRA contribution dollar limits applicable under the Internal Revenue Code;
(e) Provide on a uniform basis, if and when the State Treasurer so determines, in his or her discretion, for annual increases of each participant's contribution rate, by not more than one percent (1%) of salary or wages per year up to a maximum of eight percent (8%). Any such increases shall apply to participants, as determined by the State Treasurer, by default or only if initiated by affirmative participant election (including as part of the standard package), in either case subject to the IRA contribution limits applicable under the Internal Revenue Code;
(f) Provide for direct deposit of contributions into investments under the program;
(g) Be professionally managed;
(h) Permit no employer contributions by covered employers;
(i) Provide for reports on the status of each participant's account to be provided to each participant at least annually;
(j) When possible and practicable, use existing or new employer, other private-sector, and public infrastructure and common, collective or pooled investment arrangements to the extent desirable to facilitate and enhance the effectiveness and efficiency of program outreach, enrollment, contributions, recordkeeping, investment, distributions, compliance and other aspects of program design, administration and implementation consistent with the purposes set forth in this act, including the purpose of achieving economies of scale and other efficiencies designed to minimize costs for the program and its participants and the provisions of paragraph (l) of this section;
(k) Provide that each account holder owns the contributions to or earnings on amounts contributed to his or her account under the program and that the state and employers have no proprietary interest in those contributions or earnings;
(l) Be designed and implemented in a manner consistent with federal law, including favorable federal tax treatment, to the extent that it applies and is consistent with the program not being preempted by ERISA;
(m) Make provision for the participation in the program of individuals who are not employees;
(n) Keep total fees and expenses as low as practicable and in any event each year not in excess of seventy-five hundredths of one percent (0.75%) of the total assets of the program, except that this limit shall not apply during a start-up period of three (3) years beginning with the initial implementation of the program;
(o) Establish rules and procedures governing the distribution of funds from the program, including such distributions as may be permitted or required by the program and any applicable provisions of tax laws, with the objectives of maximizing financial security in retirement, helping to protect spousal rights, and assisting participants with the challenges of decumulation of savings. The State Treasurer shall have the authority, in his or her discretion, to provide for one or more reasonably priced distribution options to provide a source of fixed regular retirement income, including income for life or for the participant's life expectancy (or for joint lives and life expectancies, as applicable); and
(p) Establish rules and procedures promoting portability of benefits, including the ability to make tax-free rollovers or transfers from IRAs under the program to other IRAs or to tax-qualified plans that accept such rollovers or transfers provided any roll-over is initiated by participants and not solicited by agents or brokers.
SECTION 5. Rules for the Mississippi Work and Save Program. The State Treasurer shall adopt rules to implement the program that:
(a) Establish the processes for enrollment and contributions to payroll deduction IRAs under the program, including elections by covered employees, withholding by covered employers of employee payroll deduction contributions from wages and remittance for deposit to IRAs, and voluntary enrollment and contributions by others, including self-employed individuals and independent contractors, through payroll deduction or otherwise;
(b) Establish the processes for withdrawals, rollovers and direct transfers from IRAs under the program in the interest of facilitating portability and maximization of benefits;
(c) Establish processes for phasing in enrollment of eligible individuals;
(d) Conduct outreach to individuals, employers, other stakeholders and the public regarding the program. Specify the contents, frequency, timing and means of required disclosures from the program to covered employees, participants, other individuals eligible to participate in the program, covered employers and other interested parties. These disclosures shall include, but need not be limited to:
(i) The benefits associated with tax-favored retirement saving;
(ii) The potential advantages and disadvantages associated with contributing to Roth IRAs and, if applicable, traditional IRAs under the program;
(iii) The eligibility rules for Roth IRAs and, if applicable, traditional IRAs;
(iv) That the individual (and not the employer, the state, any state official or the program) will be solely responsible for determining whether, and, if so, how much, the individual is eligible to contribute on a tax-favored basis to an IRA;
(v) The penalty for excess contributions to IRAs and the method of correcting excess contributions;
(vi) Instructions for enrolling, making elections to contribute or to decline to contribute, and making elections regarding contribution rates, type of IRA and investments;
(vii) Instructions for implementing and for changing the elections;
(viii) The potential availability of a saver's tax credit, including the eligibility conditions for the credit and instructions on how to claim it;
(ix) That employees seeking tax, investment or other financial advice should contact appropriate professional advisors, and that covered employers are not in a position to provide such advice and are not liable for decisions individuals make in relation to the program;
(x) That the payroll deduction IRAs are not intended to be employer-sponsored retirement plans and that the program is not an employer-sponsored retirement plan;
(xi) The potential implications of account balances under the program for the application of asset limits under certain public assistance programs;
(xii) That the account owner is solely responsible for investment performance, including market gains and losses, and that IRA accounts and rates of return are not guaranteed by any employer, the state, any state official or the program;
(xiii) Additional information about retirement and saving and other information designed to promote financial literacy and capability (which may take the form of links to, or explanations of how to obtain, such information); and
(xiv) How to obtain additional information about the program.
SECTION 6. Protection from liability for employers. (1) A covered employer or other employer is not and shall not be liable for or bear responsibility for:
(a) An employee's decision to participate in or not to participate in the program or a participant's specific elections under the program;
(b) Participants' or the State Treasurer's investment decisions;
(c) The administration, investment, investment returns or investment performance of the program, including, without limitation, any interest rate or other rate of return on any contribution or account balance, provided they play no role;
(d) The program design or the benefits paid to participants;
(e) Individuals' awareness of or compliance with the conditions and other provisions of the tax laws that determine which individuals are eligible to make tax-favored contributions to IRAs, in what amount, and in what time frame and manner; or
(f) Any loss, failure to realize any gain, or any other adverse consequences, including, without limitation, any adverse tax consequences or loss of favorable tax treatment, public assistance or other benefits, incurred by any person as a result of participating in the program.
(2) No covered employer or other employer shall be, or shall be considered to be, a fiduciary in relation to the program or trust or any other arrangement under the program.
SECTION 7. Protection from liability for the state. (1) The state, any state official, commission or agency, any member, officer or employee thereof, and the program:
(a) Have no responsibility for compliance by individuals with the conditions and other provisions of the Internal Revenue Code that determine which individuals are eligible to make tax-favored contributions to IRAs, in what amount, and in what time frame and manner;
(b) Have no duty, responsibility, or liability to any party for the payment of any benefits under the program, regardless of whether sufficient funds are available under the program to pay such benefits;
(c) Do not and shall not guarantee any interest rate or other rate of return on or investment performance of any contribution or account balance; and
(d) Are not and shall not be liable or responsible for any loss, deficiency, failure to realize any gain, or any other adverse consequences, including, without limitation, any adverse tax consequences or loss of favorable tax treatment, public assistance or other benefits, incurred by any person as a result of participating in the program.
(2) The debts, contracts and obligations of the program are not the debts, contracts and obligations of the state, and neither the faith and credit nor the taxing power of the state is pledged directly or indirectly to the payment of the debts, contracts and obligations of the program.
SECTION 8. Confidentiality of participant and account information. Individual account information relating to accounts under the program and relating to individual participants (including, but not limited to, names, addresses, telephone numbers, email addresses, personal identification information, investments, contributions and earnings) is confidential and must be maintained as confidential:
(a) Except to the extent necessary to administer the program in a manner consistent with this act, the tax laws of this state, and the Internal Revenue Code; or
(b) Unless the individual who provides the information or is the subject of the information expressly agrees in writing to the disclosure of the information.
SECTION 9. Intergovernmental collaboration and cooperation.
The State Treasurer may enter into an intergovernmental agreement or memorandum of understanding with the state and any agency of the state to receive outreach, technical assistance, enforcement and compliance services, collection or dissemination of information pertinent to the program (subject to such obligations of confidentiality as may be agreed or required by law), or other services or assistance. The state and any agencies of the state that enter into such agreements or memoranda of understanding shall collaborate to provide the outreach, assistance, information and compliance or other services or assistance to the State Treasurer. The memoranda of understanding may cover the sharing of costs incurred in gathering and disseminating information and the reimbursement of costs for any enforcement activities or assistance.
SECTION 10. Funding of program. (1) The Mississippi Work and Save Administrative Fund is created as a special fund in the State Treasury for the sole purpose of paying the administrative costs and expenses of the program. Monies in the fund shall be expended by the State Treasurer, upon appropriation of the Legislature, for the purposes authorized in this act. The fund shall consist of:
(a) Monies appropriated to or transferred into the fund by the Legislature, or otherwise made available by the Legislature in any manner;
(b) Monies transferred to the fund from the federal government, other state agencies, or local governments;
(c) Monies from the payment of application, account, administrative, or other fees and the payment of other monies due the State Treasurer;
(d) Any gifts, donations, or grants made to the state for deposit in the fund;
(e) Monies collected for the fund from contributions to, or investment returns or assets of, the program or other monies collected by or for the program or pursuant to arrangements established under the program to the extent permitted under federal and state law; and
(f) Earnings on monies in the fund.
(2) The State Treasurer shall accept any grants, gifts, appropriations or other monies from the state, any unit of federal, state or local government, or any other person, firm, partnership, corporation or other entity solely for deposit into the fund, whether for investment or administrative expenses.
(3) Unexpended amounts remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund, and any interest earned or investment earnings on amounts in the fund shall be deposited into such fund.
(4) To enable or facilitate the start-up and continuing operation, maintenance, administration and management of the program until the program accumulates sufficient balances and can generate sufficient funding through fees assessed on program accounts for the program to become financially self-sustaining: (a) The State Treasurer may borrow from the state, any unit of federal, state or local government, or any other person, firm, partnership, corporation or other entity working capital funds and other funds as may be necessary for this purpose, provided that such funds are borrowed in the name of the program only and that any such borrowings shall be payable solely from the revenues of the program; and
(b) The State Treasurer may enter into long-term procurement contracts with one or more financial providers that provide a fee structure that would assist the program in avoiding or minimizing the need to borrow or to rely upon general assets of the state.
(5) The state may pay administrative costs associated with the creation, maintenance, operation and management of the program and trust until sufficient assets are available in the fund for that purpose. Thereafter, all administrative costs of the fund, including any repayment of start-up funds provided by the state, shall be repaid only out of monies on deposit in the fund. However, private funds or federal funding received in order to implement the program until the fund is self-sustaining shall not be repaid unless those funds were offered contingent upon the promise of such repayment.
(6) The State Treasurer may use the monies in the fund solely to pay the administrative costs and expenses of the program and the administrative costs and expenses the State Treasurer incurs in the performance of his or her duties under this act.
SECTION 11. Audits and annual reports. (1) The State Treasurer shall cause an accurate account of all of the program's, trust's and State Treasurer's activities, operations, receipts and expenditures to be maintained. Each year, a full audit of the books and accounts of the State Treasurer pertaining to those activities, operations, receipts and expenditures, personnel, services or facilities shall be conducted by a certified public accountant and shall include, but not be limited to, direct and indirect costs attributable to the use of outside consultants, independent contractors, and any other persons who are not state employees for the administration of the program. For the purposes of the audit, the auditors shall have access to the properties and records of the program and may prescribe methods of accounting and the rendering of periodic reports in relation to projects undertaken by the program.
(2) By August 1 of each year, the State Treasurer shall submit to the Governor, the State Treasurer and the appropriate committees of the Senate and House an audited financial report, prepared in accordance with generally accepted accounting principles, detailing the activities, operations, receipts and expenditures of the program during the preceding calendar year. The report shall also include projected activities of the program for the current calendar year.
(3) The State Treasurer shall prepare an annual report on the operation of the program to be available to all citizens and provided to appropriate state officials.
SECTION 12. Applicability dates. (1) The State Treasurer shall establish the program so that individuals can begin contributing under the program not later than August 1, 2028.
(2) The State Treasurer may phase in the program so that the ability to contribute first applies on different dates for different classes of individuals, including employees of employers of different sizes or types and individuals who are not employees (self-employed, independent contractors, etc.). However, any such staged or phased-in implementation schedule must be substantially completed not later than twenty-four (24) months after the effective date of this act.
(3) The State Treasurer shall not implement the program if and to the extent that he or she determines that the program is preempted by ERISA. Accordingly, the State Treasurer may implement the program in a severable fashion if the State Treasurer determines:
(a) That a portion or aspect of the program is preempted by ERISA, then the State Treasurer shall not implement that portion or aspect of the program but shall proceed to implement the remainder of the program to the extent practicable; or
(b) That some but not all of the payroll deduction IRA arrangements or other arrangements under the program are or would be employee benefit plans under ERISA, then the State Treasurer shall proceed to implement the program with respect to the other arrangements under the program to the extent practicable.
SECTION 13. (1) As used in this section, the following words shall have the meanings ascribed herein unless the context clearly requires otherwise:
(a) "Accreted value" of any bonds means, as of any date of computation, an amount equal to the sum of (i) the stated initial value of such bond, plus (ii) the interest accrued thereon from the issue date to the date of computation at the rate, compounded semiannually, that is necessary to produce the approximate yield to maturity shown for bonds of the same maturity.
(b) "State" means the State of Mississippi.
(c) "Commission" means the State Bond Commission.
(2) (a) The commission, at one time, or from time to time, may declare by resolution the necessity for issuance of general obligation bonds of the State of Mississippi to provide funds for the Mississippi Work and Save Administrative Fund created in Section 10 of this act. Upon the adoption of a resolution by the Department of Finance and Administration declaring the necessity for the issuance of any part or all of the general obligation bonds authorized by this subsection, the department shall deliver a certified copy of its resolution or resolutions to the commission. Upon receipt of such resolution, the commission, in its discretion, may act as the issuing agent, prescribe the form of the bonds, determine the appropriate method for sale of the bonds, advertise for and accept bids or negotiate the sale of the bonds, issue and sell the bonds so authorized to be sold, and do any and all other things necessary and advisable in connection with the issuance and sale of such bonds. The total amount of bonds issued under this section shall not exceed Two Hundred Thousand Dollars ($200,000.00). No bonds authorized under this section shall be issued after July 1, 2030.
(b) The proceeds of bonds issued pursuant to this section shall be deposited into the Mississippi Work and Save Administrative Fund created pursuant to Section 10 of this act. Any investment earnings on bonds issued pursuant to this section shall be used to pay debt service on bonds issued under this section, in accordance with the proceedings authorizing issuance of such bonds.
(3) The principal of and interest on the bonds authorized under this section shall be payable in the manner provided in this subsection. Such bonds shall bear such date or dates, be in such denomination or denominations, bear interest at such rate or rates (not to exceed the limits set forth in Section 75-17-101, Mississippi Code of 1972), be payable at such place or places within or without the State of Mississippi, shall mature absolutely at such time or times not to exceed twenty-five (25) years from date of issue, be redeemable before maturity at such time or times and upon such terms, with or without premium, shall bear such registration privileges, and shall be substantially in such form, all as shall be determined by resolution of the commission.
(4) The bonds authorized by this section shall be signed by the chairman of the commission, or by his facsimile signature, and the official seal of the commission shall be affixed thereto, attested by the secretary of the commission. The interest coupons, if any, to be attached to such bonds may be executed by the facsimile signatures of such officers. Whenever any such bonds shall have been signed by the officials designated to sign the bonds who were in office at the time of such signing but who may have ceased to be such officers before the sale and delivery of such bonds, or who may not have been in office on the date such bonds may bear, the signatures of such officers upon such bonds and coupons shall nevertheless be valid and sufficient for all purposes and have the same effect as if the person so officially signing such bonds had remained in office until their delivery to the purchaser, or had been in office on the date such bonds may bear. However, notwithstanding anything herein to the contrary, such bonds may be issued as provided in the Registered Bond Act of the State of Mississippi.
(5) All bonds and interest coupons issued under the provisions of this section have all the qualities and incidents of negotiable instruments under the provisions of the Uniform Commercial Code, and in exercising the powers granted by this section, the commission shall not be required to and need not comply with the provisions of the Uniform Commercial Code.
(6) The commission shall act as the issuing agent for the bonds authorized under this section, prescribe the form of the bonds, determine the appropriate method for sale of the bonds, advertise for and accept bids or negotiate the sale of the bonds, issue and sell the bonds so authorized to be sold, pay all fees and costs incurred in such issuance and sale, and do any and all other things necessary and advisable in connection with the issuance and sale of such bonds. The commission is authorized and empowered to pay the costs that are incident to the sale, issuance and delivery of the bonds authorized under this section from the proceeds derived from the sale of such bonds. The commission shall sell such bonds on sealed bids at public sale or may negotiate the sale of the bonds for such price as it may determine to be for the best interest of the State of Mississippi. All interest accruing on such bonds so issued shall be payable semiannually or annually.
If the bonds are to be sold on sealed bids at public sale, notice of the sale of any such bonds shall be published at least one time, not less than ten (10) days before the date of sale, and shall be so published in one or more newspapers published or having a general circulation in the City of Jackson, Mississippi, selected by the commission.
The commission, when issuing any bonds under the authority of this section, may provide that bonds, at the option of the State of Mississippi, may be called in for payment and redemption at the call price named therein and accrued interest on such date or dates named therein.
(7) The bonds issued under the provisions of this section are general obligations of the State of Mississippi, and for the payment thereof the full faith and credit of the State of Mississippi is irrevocably pledged. If the funds appropriated by the Legislature are insufficient to pay the principal of and the interest on such bonds as they become due, then the deficiency shall be paid by the State Treasurer from any funds in the State Treasury not otherwise appropriated. All such bonds shall contain recitals on their faces substantially covering the provisions of this subsection.
(8) Upon the issuance and sale of bonds under the provisions of this section, the commission shall transfer the proceeds of any such sale or sales to the Mississippi Work and Save Administrative Fund created in Section 10 of this act. The proceeds of such bonds shall be disbursed as provided in such section under such restrictions, if any, as may be contained in the resolution providing for the issuance of the bonds.
(9) The bonds authorized under this section may be issued without any other proceedings or the happening of any other conditions or things other than those proceedings, conditions and things which are specified or required by this section. Any resolution providing for the issuance of bonds under the provisions of this section shall become effective immediately upon its adoption by the commission, and any such resolution may be adopted at any regular or special meeting of the commission by a majority of its members.
(10) The bonds authorized under the authority of this section may be validated in the Chancery Court of the First Judicial District of Hinds County, Mississippi, in the manner and with the force and effect provided by Chapter 13, Title 31, Mississippi Code of 1972, for the validation of county, municipal, school district and other bonds. The notice to taxpayers required by such statutes shall be published in a newspaper published or having a general circulation in the City of Jackson, Mississippi.
(11) Any holder of bonds issued under the provisions of this section or of any of the interest coupons pertaining thereto may, either at law or in equity, by suit, action, mandamus or other proceeding, protect and enforce any and all rights granted under this section, or under such resolution, and may enforce and compel performance of all duties required by this section to be performed, in order to provide for the payment of bonds and interest thereon.
(12) All bonds issued under the provisions of this section shall be legal investments for trustees and other fiduciaries, and for savings banks, trust companies and insurance companies organized under the laws of the State of Mississippi, and such bonds shall be legal securities which may be deposited with and shall be received by all public officers and bodies of this state and all municipalities and political subdivisions for the purpose of securing the deposit of public funds.
(13) Bonds issued under the provisions of this section and income therefrom shall be exempt from all taxation in the State of Mississippi.
(14) The proceeds of the bonds issued under this section shall be used solely for the purposes therein provided, including the costs incident to the issuance and sale of such bonds.
(15) The State Treasurer is authorized, without further process of law, to certify to the Department of Finance and Administration the necessity for warrants, and the Department of Finance and Administration is authorized and directed to issue such warrants, in such amounts as may be necessary to pay when due the principal of, premium, if any, and interest on, or the accreted value of, all bonds issued under this section; and the State Treasurer shall forward the necessary amount to the designated place or places of payment of such bonds in ample time to discharge such bonds, or the interest thereon, on the due dates thereof.
(16) This section shall be deemed to be full and complete authority for the exercise of the powers therein granted, but this section shall not be deemed to repeal or to be in derogation of any existing law of this state.
SECTION 14. Section 27-7-15, Mississippi Code of 1972, is amended as follows:
27-7-15. (1) For the purposes of this article, except as otherwise provided, the term "gross income" means and includes the income of a taxpayer derived from salaries, wages, fees or compensation for service, of whatever kind and in whatever form paid, including income from governmental agencies and subdivisions thereof; or from professions, vocations, trades, businesses, commerce or sales, or renting or dealing in property, or reacquired property; also from annuities, interest, rents, dividends, securities, insurance premiums, reinsurance premiums, considerations for supplemental insurance contracts, or the transaction of any business carried on for gain or profit, or gains, or profits, and income derived from any source whatever and in whatever form paid. The amount of all such items of income shall be included in the gross income for the taxable year in which received by the taxpayer. The amount by which an eligible employee's salary is reduced pursuant to a salary reduction agreement authorized under Section 25-17-5 shall be excluded from the term "gross income" within the meaning of this article.
(2) In determining gross income for the purpose of this section, the following, under regulations prescribed by the commissioner, shall be applicable:
(a) Dealers in property. Federal rules, regulations and revenue procedures shall be followed with respect to installment sales unless a transaction results in the shifting of income from inside the state to outside the state.
(b) Casual sales of property.
(i) Prior to January 1, 2001, federal rules, regulations and revenue procedures shall be followed with respect to installment sales except they shall be applied and administered as if H.R. 3594, the Installment Tax Correction Act of 2000 of the 106th Congress, had not been enacted. This provision will generally affect taxpayers, reporting on the accrual method of accounting, entering into installment note agreements on or after December 17, 1999. Any gain or profit resulting from the casual sale of property will be recognized in the year of sale.
(ii) From and after January 1, 2001, federal rules, regulations and revenue procedures shall be followed with respect to installment sales except as provided in this subparagraph (ii). Gain or profit from the casual sale of property shall be recognized in the year of sale. When a taxpayer recognizes gain on the casual sale of property in which the gain is deferred for federal income tax purposes, a taxpayer may elect to defer the payment of tax resulting from the gain as allowed and to the extent provided under regulations prescribed by the commissioner. If the payment of the tax is made on a deferred basis, the tax shall be computed based on the applicable rate for the income reported in the year the payment is made. Except as otherwise provided in subparagraph (iii) of this paragraph (b), deferring the payment of the tax shall not affect the liability for the tax. If at any time the installment note is sold, contributed, transferred or disposed of in any manner and for any purpose by the original note holder, or the original note holder is merged, liquidated, dissolved or withdrawn from this state, then all deferred tax payments under this section shall immediately become due and payable.
(iii) If the selling price of the property is reduced by any alteration in the terms of an installment note, including default by the purchaser, the gain to be recognized is recomputed based on the adjusted selling price in the same manner as for federal income tax purposes. The tax on this amount, less the previously paid tax on the recognized gain, is payable over the period of the remaining installments. If the tax on the previously recognized gain has been paid in full to this state, the return on which the payment was made may be amended for this purpose only. The statute of limitations in Section 27-7-49 shall not bar an amended return for this purpose.
(c) Reserves of insurance companies. In the case of insurance companies, any amounts in excess of the legally required reserves shall be included as gross income.
(d) Affiliated companies or persons. As regards sales, exchanges or payments for services from one to another of affiliated companies or persons or under other circumstances where the relation between the buyer and seller is such that gross proceeds from the sale or the value of the exchange or the payment for services are not indicative of the true value of the subject matter of the sale, exchange or payment for services, the commissioner shall prescribe uniform and equitable rules for determining the true value of the gross income, gross sales, exchanges or payment for services, or require consolidated returns of affiliates.
(e) Alimony and separate maintenance payments. The federal rules, regulations and revenue procedures in determining the deductibility and taxability of alimony payments shall be followed in this state.
(f) Reimbursement for expenses of moving. There shall be included in gross income (as compensation for services) any amount received or accrued, directly or indirectly, by an individual as a payment for or reimbursement of expenses of moving from one (1) residence to another residence which is attributable to employment or self-employment.
(3) In the case of taxpayers other than residents, gross income includes gross income from sources within this state.
(4) The words "gross income" do not include the following items of income which shall be exempt from taxation under this article:
(a) The proceeds of life insurance policies and contracts paid upon the death of the insured. However, the income from the proceeds of such policies or contracts shall be included in the gross income.
(b) The amount received by the insured as a return of premium or premiums paid by him under life insurance policies, endowment, or annuity contracts, either during the term or at maturity or upon surrender of the contract.
(c) The value of property acquired by gift, bequest, devise or descent, but the income from such property shall be included in the gross income.
(d) Interest upon the obligations of the United States or its possessions, or securities issued under the provisions of the Federal Farm Loan Act of 1916, or bonds issued by the War Finance Corporation, or obligations of the State of Mississippi or political subdivisions thereof.
(e) The amounts received through accident or health insurance as compensation for personal injuries or sickness, plus the amount of any damages received for such injuries or such sickness or injuries, or through the War Risk Insurance Act, or any law for the benefit or relief of injured or disabled members of the military or naval forces of the United States.
(f) Income received by any religious denomination or by any institution or trust for moral or mental improvements, religious, Bible, tract, charitable, benevolent, fraternal, missionary, hospital, infirmary, educational, scientific, literary, library, patriotic, historical or cemetery purposes or for two (2) or more of such purposes, if such income be used exclusively for carrying out one or more of such purposes.
(g) Income received by a domestic corporation which is "taxable in another state" as this term is defined in this article, derived from business activity conducted outside this state. Domestic corporations taxable both within and without the state shall determine Mississippi income on the same basis as provided for foreign corporations under the provisions of this article.
(h) In case of insurance companies, there shall be excluded from gross income such portion of actual premiums received from an individual policyholder as is paid back or credited to or treated as an abatement of premiums of such policyholder within the taxable year.
(i) Income from dividends that has already borne a tax as dividend income under the provisions of this article, when such dividends may be specifically identified in the possession of the recipient.
(j) Amounts paid by the United States to a person as added compensation for hazardous duty pay as a member of the Armed Forces of the United States in a combat zone designated by Executive Order of the President of the United States.
(k) Amounts received as retirement allowances, pensions, annuities or optional retirement allowances paid under the federal Social Security Act, the Railroad Retirement Act, the Federal Civil Service Retirement Act, or any other retirement system of the United States government, retirement allowances paid under the Mississippi Public Employees' Retirement System, Mississippi Highway Safety Patrol Retirement System or any other retirement system of the State of Mississippi or any political subdivision thereof. The exemption allowed under this paragraph (k) shall be available to the spouse or other beneficiary at the death of the primary retiree.
(l) Amounts received as retirement allowances, pensions, annuities or optional retirement allowances paid by any public or governmental retirement system not designated in paragraph (k) or any private retirement system or plan of which the recipient was a member at any time during the period of his employment. Amounts received as a distribution under a Roth Individual Retirement Account shall be treated in the same manner as provided under the Internal Revenue Code of 1986, as amended. The exemption allowed under this paragraph (l) shall be available to the spouse or other beneficiary at the death of the primary retiree.
(m) National Guard or Reserve Forces of the United States compensation not to exceed the aggregate sum of Five Thousand Dollars ($5,000.00) for any taxable year through the 2005 taxable year, and not to exceed the aggregate sum of Fifteen Thousand Dollars ($15,000.00) for any taxable year thereafter.
(n) Compensation received for active service as a member below the grade of commissioned officer and so much of the compensation as does not exceed the maximum enlisted amount received for active service as a commissioned officer in the Armed Forces of the United States for any month during any part of which such members of the Armed Forces (i) served in a combat zone as designated by Executive Order of the President of the United States or a qualified hazardous duty area as defined by federal law, or both; or (ii) was hospitalized as a result of wounds, disease or injury incurred while serving in such combat zone. For the purposes of this paragraph (n), the term "maximum enlisted amount" means and has the same definition as that term has in 26 USCS 112.
(o) The proceeds received from federal and state forestry incentive programs.
(p) The amount representing the difference between the increase of gross income derived from sales for export outside the United States as compared to the preceding tax year wherein gross income from export sales was highest, and the net increase in expenses attributable to such increased exports. In the absence of direct accounting, the ratio of net profits to total sales may be applied to the increase in export sales. This paragraph (p) shall only apply to businesses located in this state engaging in the international export of Mississippi goods and services. Such goods or services shall have at least fifty percent (50%) of value added at a location in Mississippi.
(q) Amounts paid by the federal government for the construction of soil conservation systems as required by a conservation plan adopted pursuant to 16 USCS 3801 et seq.
(r) The amount deposited in a medical savings account, and any interest accrued thereon, that is a part of a medical savings account program as specified in the Medical Savings Account Act under Sections 71-9-1 through 71-9-9; provided, however, that any amount withdrawn from such account for purposes other than paying eligible medical expense or to procure health coverage shall be included in gross income.
(s) Amounts paid by the Mississippi Soil and Water Conservation Commission from the Mississippi Soil and Water Cost-Share Program for the installation of water quality best management practices.
(t) Dividends received by a holding corporation, as defined in Section 27-13-1, from a subsidiary corporation, as defined in Section 27-13-1.
(u) Interest, dividends, gains or income of any kind on any account in the Mississippi Affordable College Savings Trust Fund, as established in Sections 37-155-101 through 37-155-125, to the extent that such amounts remain on deposit in the MACS Trust Fund or are withdrawn pursuant to a qualified withdrawal, as defined in Section 37-155-105.
(v) Interest, dividends or gains accruing on the payments made pursuant to a prepaid tuition contract, as provided for in Section 37-155-17.
(w) Income resulting from transactions with a related member where the related member subject to tax under this chapter was required to, and did in fact, add back the expense of such transactions as required by Section 27-7-17(2). Under no circumstances may the exclusion from income exceed the deduction add-back of the related member, nor shall the exclusion apply to any income otherwise excluded under this chapter.
(x) Amounts that are subject to the tax levied pursuant to Section 27-7-901, and are paid to patrons by gaming establishments licensed under the Mississippi Gaming Control Act.
(y) Amounts that are subject to the tax levied pursuant to Section 27-7-903, and are paid to patrons by gaming establishments not licensed under the Mississippi Gaming Control Act.
(z) Interest, dividends, gains or income of any kind on any account in a qualified tuition program and amounts received as distributions under a qualified tuition program shall be treated in the same manner as provided under the United States Internal Revenue Code, as amended. For the purposes of this paragraph (z), the term "qualified tuition program" means and has the same definition as that term has in 26 USCS 529.
(aa) The amount deposited in a health savings account, and any interest accrued thereon, that is a part of a health savings account program as specified in the Health Savings Accounts Act created in Sections 83-62-1 through 83-62-9; however, any amount withdrawn from such account for purposes other than paying qualified medical expenses or to procure health coverage shall be included in gross income, except as otherwise provided by Sections 83-62-7 and 83-62-9.
(bb) Amounts received as qualified disaster relief payments shall be treated in the same manner as provided under the United States Internal Revenue Code, as amended.
(cc) Amounts received as a "qualified Hurricane Katrina distribution" as defined in the United States Internal Revenue Code, as amended.
(dd) Amounts received by an individual which may be excluded from income as foreign earned income for federal income tax purposes.
(ee) Amounts received by a qualified individual, directly or indirectly, from an employer or nonprofit housing organization that are qualified housing expenses associated with an employer-assisted housing program. For purposes of this paragraph (ee):
(i) "Qualified individual" means any individual whose household income does not exceed one hundred twenty percent (120%) of the area median gross income (as defined by the United States Department of Housing and Urban Development), adjusted for household size, for the area in which the housing is located.
(ii) "Nonprofit housing organization" means an organization that is organized as a not-for-profit organization under the laws of this state or another state and has as one of its purposes:
1. Homeownership education or counseling;
2. The development of affordable housing; or
3. The development or administration of employer-assisted housing programs.
(iii) "Employer-assisted housing program" means a separate written plan of any employer (including, without limitation, tax-exempt organizations and public employers) for the exclusive benefit of the employer's employees to pay qualified housing expenses to assist the employer's employees in securing affordable housing.
(iv) "Qualified housing expenses" means:
1. With respect to rental assistance, an amount not to exceed Two Thousand Dollars ($2,000.00) paid for the purpose of assisting employees with security deposits and rental subsidies; and
2. With respect to homeownership assistance, an amount not to exceed the lesser of Ten Thousand Dollars ($10,000.00) or six percent (6%) of the purchase price of the employee's principal residence that is paid for the purpose of assisting employees with down payments, payment of closing costs, reduced interest mortgages, mortgage guarantee programs, mortgage forgiveness programs, equity contribution programs, or contributions to homebuyer education and/or homeownership counseling of eligible employees.
(ff) For the 2010 taxable year and any taxable year thereafter, amounts converted in accordance with the United States Internal Revenue Code, as amended, from a traditional Individual Retirement Account to a Roth Individual Retirement Account. The exemption allowed under this paragraph (ff) shall be available to the spouse or other beneficiary at the death of the primary retiree.
(gg) Amounts received for the performance of disaster or emergency-related work as defined in Section 27-113-5.
(hh) The amount deposited in a catastrophe savings account established under Sections 27-7-1001 through 27-7-1007, interest income earned on the catastrophe savings account, and distributions from the catastrophe savings account; however, any amount withdrawn from a catastrophe savings account for purposes other than paying qualified catastrophe expenses shall be included in gross income, except as otherwise provided by Sections 27-7-1001 through 27-7-1007.
(ii) Interest, dividends, gains or income of any kind on any account in the Mississippi Achieving a Better Life Experience (ABLE) Trust Fund, as established in Chapter 28, Title 43, to the extent that such amounts remain on deposit in the ABLE Trust Fund or are withdrawn pursuant to a qualified withdrawal, as defined in Section 43-28-11.
(jj) Subject to the limitations provided under Section 27-7-1103, amounts deposited into a first-time homebuyer savings account and any interest or other income earned attributable to an account and monies or funds withdrawn or distributed from an account for the payment of eligible costs by or on behalf of a qualified beneficiary; however, any monies or funds withdrawn or distributed from a first-time homebuyer savings account for any purpose other than the payment of eligible costs by or on behalf of a qualified beneficiary shall be included in gross income. For the purpose of this paragraph (jj), the terms "first-time homebuyer savings account," "eligible costs" and "qualified beneficiary" mean and have the same definitions as such terms have in Section 27-7-1101.
(kk) Amounts paid by an agricultural disaster program as compensation to an agricultural producer, cattle farmer or cattle rancher who has suffered a loss as the result of a disaster or emergency, including, but not limited to, the following United States Department of Agriculture programs:
(i) Livestock Forage Disaster Program;
(ii) Livestock Indemnity Program;
(iii) Emergency Assistance for Livestock, Honey Bees and Farm-raised Fish Program;
(iv) Emergency Conservation Program;
(v) Noninsured Crop Disaster Assistance Program;
(vi) Pasture, Rangeland, Forage Pilot Insurance Program;
(vii) Annual Forage Pilot Program;
(viii) Livestock Risk Protection Insurance Program; and
(ix) Livestock Gross Margin Insurance Plan.
(mm) Any and all cancelled indebtedness provided for under the Coronavirus Aid, Relief, and Economic Security Act and the Consolidated Appropriations Act of 2021.
(nn) Amounts received as payments under Section 27-3-85.
(oo) Amounts received as grants under the 2020 COVID-19 Mississippi Business Assistance Act.
(pp) Amounts received as grants under Section 57-1-521.
( * * *qq) Amounts received as grants under
the Shuttered Venue Operators Grant Program and Restaurant Revitalization Fund
authorized by the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and
Venues Act, and amended by the American Rescue Plan Act.
( * * *rr) Amounts received as grants under
the Mississippi Agriculture Stabilization Act.
(ss) Amounts received as NIL compensation. For the purposes of this paragraph (ss):
(i) "Intercollegiate athlete" means an individual who enrolls in and participates in an intercollegiate athletics program at a postsecondary educational institution located in Mississippi.
(ii) "NIL compensation" means any money, goods, or services provided to an intercollegiate athlete, while enrolled at a postsecondary educational institution located in Mississippi, in exchange for the use of the athlete's name, image, or likeness, including revenue-sharing or name, image, and likeness payments from a postsecondary educational institution or a third-party.
(5) Prisoners of war, missing in action-taxable status.
(a) Members of the Armed Forces. Gross income does not include compensation received for active service as a member of the Armed Forces of the United States for any month during any part of which such member is in a missing status, as defined in paragraph (d) of this subsection, during the Vietnam Conflict as a result of such conflict.
(b) Civilian employees. Gross income does not include compensation received for active service as an employee for any month during any part of which such employee is in a missing status during the Vietnam Conflict as a result of such conflict.
(c) Period of conflict. For the purpose of this subsection, the Vietnam Conflict began February 28, 1961, and ends on the date designated by the President by Executive Order as the date of the termination of combatant activities in Vietnam. For the purpose of this subsection, an individual is in a missing status as a result of the Vietnam Conflict if immediately before such status began he was performing service in Vietnam or was performing service in Southeast Asia in direct support of military operations in Vietnam. "Southeast Asia," as used in this paragraph, is defined to include Cambodia, Laos, Thailand and waters adjacent thereto.
(d) "Missing status" means the status of an employee or member of the Armed Forces who is in active service and is officially carried or determined to be absent in a status of (i) missing; (ii) missing in action; (iii) interned in a foreign country; (iv) captured, beleaguered or besieged by a hostile force; or (v) detained in a foreign country against his will; but does not include the status of an employee or member of the Armed Forces for a period during which he is officially determined to be absent from his post of duty without authority.
(e) "Active service" means active federal service by an employee or member of the Armed Forces of the United States in an active duty status.
(f) "Employee" means one who is a citizen or national of the United States or an alien admitted to the United States for permanent residence and is a resident of the State of Mississippi and is employed in or under a federal executive agency or department of the Armed Forces.
(g) "Compensation" means (i) basic pay; (ii) special pay; (iii) incentive pay; (iv) basic allowance for quarters; (v) basic allowance for subsistence; and (vi) station per diem allowances for not more than ninety (90) days.
(h) If refund or credit of any overpayment of tax for any taxable year resulting from the application of this subsection (5) is prevented by the operation of any law or rule of law, such refund or credit of such overpayment of tax may, nevertheless, be made or allowed if claim therefor is filed with the Department of Revenue within three (3) years after the date of the enactment of this subsection.
(i) The provisions of this subsection shall be effective for taxable years ending on or after February 28, 1961.
(6) A shareholder of an S corporation, as defined in Section 27-8-3(1)(g), shall take into account the income, loss, deduction or credit of the S corporation only to the extent provided in Section 27-8-7(2).
SECTION 15. Section 27-65-22, Mississippi Code of 1972, is amended as follows:
27-65-22. (1) Upon every person engaging or continuing in any amusement business or activity, which shall include all manner and forms of entertainment and amusement, all forms of diversion, sport, recreation or pastime, shows, exhibitions, contests, displays, games or any other and all methods of obtaining admission charges, donations, contributions or monetary charges of any character, from the general public or a limited or selected number thereof, directly or indirectly in return for other than tangible property or specific personal or professional services, whether such amusement is held or conducted in a public or private building, hotel, tent, pavilion, lot or resort, enclosed or in the open, there is hereby levied, assessed and shall be collected a tax equal to seven percent (7%) of the gross income received as admission, except as otherwise provided herein. In lieu of the rate set forth above, there is hereby imposed, levied and assessed, to be collected as hereinafter provided, a tax of three percent (3%) of gross revenue derived from sales of admission to publicly owned enclosed coliseums and auditoriums (except admissions to athletic contests between colleges and universities). There is hereby imposed, levied and assessed a tax of seven percent (7%) of gross revenue derived from sales of admission to events conducted on property managed by the Mississippi Veterans Memorial Stadium, which tax shall be administered in the manner prescribed in this chapter, subject, however, to the provisions of Sections 55-23-3 through 55-23-11.
(2) The operator of any place of amusement in this state shall collect the tax imposed by this section, in addition to the price charged for admission to any place of amusement, and under all circumstances the person conducting the amusement shall be liable for, and pay the tax imposed based upon the actual charge for such admission. Where permits are obtained for conducting temporary amusements by persons who are not the owners, lessees or custodians of the buildings, lots or places where the amusements are to be conducted, or where such temporary amusement is permitted by the owner, lessee or custodian of any place to be conducted without the procurement of a permit as required by this chapter, the tax imposed by this chapter shall be paid by the owner, lessee or custodian of such place where such temporary amusement is held or conducted, unless paid by the person conducting the amusement, and the applicant for such temporary permit shall furnish with the application therefor, the name and address of the owner, lessee or custodian of the premises upon which such amusement is to be conducted, and such owner, lessee or custodian shall be notified by the commission of the issuance of such permit, and of the joint liability for such tax.
(3) The tax imposed by this section shall not be levied or collected upon:
(a) Any admissions charged at any place of amusement operated by a religious, charitable or educational organization, or by a nonprofit civic club or fraternal organization (i) when the net proceeds of such admissions do not inure to any one or more individuals within such organization and are to be used solely for religious, charitable, educational or civic purposes; or (ii) when the entire net proceeds are used to defray the normal operating expenses of such organization, such as loan payments, maintenance costs, repairs and other operating expenses;
(b) Any admissions charged to hear gospel singing when promoted by a duly constituted local, bona fide nonprofit charitable or religious organization, irrespective of the fact that the performers and promoters are paid out of the proceeds of admissions collected, provided the program is composed entirely of gospel singing and not generally mixed with hillbilly or popular singing;
(c) Any admissions charged at any athletic games or contests between universities or colleges, between high schools or between grammar schools;
(d) Any admissions or tickets to or for baseball games between teams operated under a professional league franchise;
(e) Any admissions to county, state or community fairs, or any admissions to entertainments presented in community homes or houses which are publicly owned and controlled, and the proceeds of which do not inure to any individual or individuals;
(f) Any admissions or tickets to organized garden pilgrimages and to antebellum and historic houses when sponsored by an organized civic or garden club;
(g) Any admissions to any golf tournament held under the auspices of the Professional Golf Association or United States Golf Association wherein touring professionals compete, if such tournament is sponsored by a nonprofit association incorporated under the laws of the State of Mississippi where no dividends are declared and the proceeds do not inure to any individual or group;
(h) Any admissions to * * * community college conference,
state, regional or national playoffs or championships;
(i) Any admissions or fees charged by any county or municipally owned and operated swimming pools, golf courses and tennis courts other than sales or rental of tangible personal property;
(j) Any admissions charged for the performance of symphony orchestras, operas, vocal or instrumental artists in which professional or amateur performers are compensated out of the proceeds of such admissions, when sponsored by local music or charity associations, or amateur dramatic performances or professional dramatic productions when sponsored by a children's dramatic association, where no dividends are declared, profits received, nor any salary or compensation paid to any of the members of such associations, or to any person for procuring or producing such performance;
(k) Any admissions or tickets to or for hockey games between teams operated under a professional league franchise;
(l) Any admissions or tickets to or for events sanctioned by the Mississippi Athletic Commission that are held within publicly owned enclosed coliseums and auditoriums;
(m) Guided tours on any navigable waters of this state, which include providing accommodations, guide services and/or related equipment operated by or under the direction of the person providing the tour, for the purposes of outdoor tourism;
(n) Any admissions to events held solely for religious or charitable purposes at livestock facilities, agriculture facilities or other facilities constructed, renovated or expanded with funds from the grant program authorized under Section 18 of Chapter 530, Laws of 1995; and
(o) (i) Any admissions charged at events, activities or entertainments:
1. Which are open to the public and held in or on parks, lands or buildings which are publicly owned, leased, used and/or controlled by a municipality, or any agency thereof;
2. Which are created and sponsored by the municipality, or an agency thereof; and
3. The proceeds of which do not inure to the benefit of any individual or individuals; however,
(ii) The governing authorities of a municipality may require the tax imposed by this section to be levied and collected at events, activities or entertainments described in subparagraph (i) of this paragraph by:
1. Adopting an ordinance requiring the levy and collection of the tax;
2. Providing the Department of Revenue with a certified copy of the ordinance requiring the tax to be levied and assessed at least thirty (30) days prior to the effective date of the ordinance;
(iii) If the ordinance described in subparagraph (ii) of this paragraph is repealed, the municipality shall provide the Department of Revenue with a certified copy of the repeal of the ordinance at least thirty (30) days prior to the effective date of the repeal.
SECTION 16. Section 14 of this act shall take effect and be in force from and after January 1, 2026, and the remaining sections of this act shall take effect and be in force from and after July 1, 2026.