Mississippi uses a flat state income tax rate of 4.7% on income over $10,000. The state recently simplified its tax system by moving to a flat rate and eliminating lower brackets, with plans to continue reducing the rate.
Mississippi Tax Structure
| Taxable Income | Tax Rate |
|---|---|
| $0 - $10,000 | 0% |
| Over $10,000 | 4.7% |
Mississippi eliminated its lower tax brackets in 2023, creating a simplified two-tier system. Based on Mississippi Department of Revenue guidelines.
What You'll See on Your Paystub
A Mississippi worker's paystub includes both federal income tax withholding and state deductions:
| Deduction | Rate | Notes |
|---|---|---|
| Federal Income Tax | Varies | Based on W-4 and income |
| Social Security | 6.2% | Up to $181,200 wage base |
| Medicare | 1.45% | No wage limit |
| Mississippi State Income Tax | 0% - 4.7% | 0% on first $10,000, then 4.7% |
The $10,000 zero bracket means no state tax on the first $10,000 of income. This effectively reduces your overall tax burden compared to states with no zero bracket.
Mississippi Standard Deduction
Mississippi provides a standard deduction:
| Filing Status | Standard Deduction (2026) |
|---|---|
| Single | $2,300 |
| Married Filing Jointly | $4,600 |
| Head of Household | $3,400 |
No Local Income Taxes
Mississippi does not allow cities or counties to impose local income taxes. Your state withholding covers all Mississippi income tax obligations.
Jackson Metro Workers
Jackson is Mississippi's capital and largest city:
- State government headquarters
- Healthcare (UMMC, Baptist, St. Dominic)
- Finance and insurance
- No city income tax
Gulf Coast Workers
The Mississippi Gulf Coast has unique employment:
- Casinos (Biloxi, Gulfport)
- Shipbuilding (Ingalls Shipbuilding in Pascagoula)
- Keesler Air Force Base (Biloxi)
- Tourism and hospitality
- No local income taxes
Ingalls Shipbuilding is one of Mississippi's largest private employers, building Navy destroyers and amphibious ships. Defense industry workers enjoy no local income taxes.
North Mississippi Workers
North Mississippi has strong ties to Memphis, Tennessee:
- DeSoto County is part of the Memphis metro
- Toyota manufacturing (Blue Springs)
- Furniture manufacturing heritage
- Many workers commute to Tennessee
Mississippi-Tennessee Border
Tennessee has no state income tax, which creates considerations for border workers:
- Live in MS, work in TN: Pay Mississippi tax on all income
- Live in TN, work in MS: Pay Mississippi tax on Mississippi-source income
Living in Tennessee and working in Mississippi means you'd pay Mississippi tax on your wages but avoid the higher overall burden of living in Mississippi. However, cost of living and commute should also factor in.
Golden Triangle Workers
The Golden Triangle (Columbus, Starkville, West Point) has growing industry:
- Steel Dynamics steel mill
- Yokohama Tire manufacturing
- Mississippi State University
- Columbus Air Force Base
Automotive Manufacturing
Mississippi has attracted automotive investment:
- Toyota (Blue Springs)
- Nissan (Canton)
- Many supplier plants
- Competitive wages with low cost of living
Retirement Income
Mississippi is tax-friendly for retirees:
- Social Security benefits are fully exempt
- Qualified retirement income is fully exempt (pensions, 401k, IRA distributions)
- Military retirement pay is fully exempt
- The $10,000 zero bracket provides additional relief
Mississippi exempts all qualified retirement income from state income tax, making it one of the most retirement-friendly states in the nation.
Military Personnel
Mississippi has several military installations:
- Keesler Air Force Base (Biloxi)
- Columbus Air Force Base
- Naval Construction Battalion Center (Gulfport)
- Camp Shelby (Army National Guard)
Military considerations:
- Active duty pay taxed based on legal residence
- Military retirement pay is fully exempt
- Military spouses can use service member's residence state
Mississippi vs. Neighboring States
| State | Tax Structure | Top Rate |
|---|---|---|
| Mississippi | Flat (with zero bracket) | 4.7% |
| Tennessee | None | 0% |
| Alabama | Progressive | 5% |
| Louisiana | Progressive | 4.25% |
| Arkansas | Progressive | 4.4% |
Comparing Take-Home Pay
Here's how a $60,000 annual salary compares in the region:
| State | Effective Rate | Annual State Tax |
|---|---|---|
| Mississippi | ~3.9% | ~$2,350 |
| Tennessee | 0% | $0 |
| Alabama | ~3.5% | ~$2,100 |
| Louisiana | ~3.5% | ~$2,100 |
| Arkansas | ~3.8% | ~$2,280 |
Mississippi's $10,000 zero bracket lowers the effective rate for most workers. Combined with no local taxes and a low cost of living, Mississippi offers good take-home pay value.
Planned Rate Reductions
Mississippi has plans to further reduce income taxes:
| Year | Tax Rate |
|---|---|
| 2026 | 4.7% |
| 2027 | 4.4% |
| 2028 | 4% |
| Long-term goal | Possible elimination |
Mississippi has committed to reducing its income tax rate, with some legislators advocating for eventual elimination. Monitor updates from the Department of Revenue.
Key Takeaways
- Mississippi has a flat 4.7% rate on income over $10,000
- The $10,000 zero bracket means no tax on the first $10,000 of income
- No local income taxes anywhere in the state
- All retirement income (Social Security, pensions, 401k, IRA) is exempt
- Rates are scheduled to decrease in coming years
- Low cost of living enhances take-home pay value