An income tax credit is available for a business enterprise engaged in commercial, industrial or professional activities operating as a corporation, limited liability company, partnership or sole proprietorship. A credit is allowed against the taxes imposed by Miss. Code Ann. Sections 27-7-5, 27-15-103, 27-15-109 and 27-15-123, for voluntary cash contributions during the taxable year to an eligible charitable organization (ECO). The amount of credit that may be utilized in a taxable year shall be limited to an amount not to exceed fifty percent (50%) of the total tax liability of the business enterprise for the taxes imposed by such sections of law.
Beginning January 1, 2021, Miss. Code Ann. §27-7-22.41 provides that the aggregate amount of tax credits that may be allocated by the Department of Revenue to certain business enterprises making voluntary cash contributions to ECOs cannot exceed ten million dollars ($10,000,000) in a calendar year.
Up to five million dollars ($5,000,000) of the tax credits allocated during a calendar year may be allocated for contributions to ECOs that are either licensed by, under contract, or have an agreement with the MS Department of Child Protection Services related to adoption and/or foster care related activities with no more than twenty-five percent (25%) of such credits being allocated for contributions to a single ECO; this results in a per ECO cap of $1,250,000.
Up to five million dollars ($5,000,000) of the tax credits allocated during a calendar year may be allocated for contributions to ECOs certified by the Department as educational services (ESCO), job training (JTCO), or workforce development (WDCO) charitable organizations with no more than five percent (5%) of such credits may be allocated for contributions to a single ECO certified as such; this results in a per ECO cap of $250,000.
Businesses claiming their contribution(s) on their tax return must have their contribution(s) certified by completing the following application and sending it to the Department for review. Instructions are included in the application.