Mississippi Conformity

As the Tax Cuts & Jobs Act celebrated its first birthday as federal tax law on December 22, 2018, Mississippi began issuing the final guidelines on its conformity with the changes found within the Tax Cuts & Jobs Act.

 

2018 Federal Law Changes

2018 Mississippi Conformity

Deduction of State & Local Taxes by Individuals

Individuals may claim an itemized deduction on Sch A. of up to $10,000 for state & local property taxes, sales tax, & income taxes.

Individuals may claim an itemized deduction of up to $10,000 for state & local property taxes, sales tax, & income taxes.

Home Mortgage Interest Deduction

Provides an itemized deduction for home mortgage interest on mortgages up to $750,000.

Provides an itemized deduction for home mortgage interest on mortgages up to $750,000.

Deduction for Personal Casualty & Theft Losses

Personal casualty & theft loss deduction suspended, except in the case of a federally declared emergency.

Personal casualty & theft loss deduction suspended, except in the case of a federally declared emergency.

Suspension of Overall Limitation on Itemized Deductions

Overall limitation on itemized deduction is suspended until 2025.

Overall limitation on itemized deduction is suspended until 2025.

Deduction for Alimony & Separate Maintenance Payments

Alimony & separate maintenance payments are not deductible.

Alimony & separate maintenance payments are not deductible.

Limitation on Excess Business Losses

Business losses in excess of $250,000 are not allowed to offset non-business income.

No explicit directive has been issued with respects to Mississippi following excess business loss rules.

Changes to Net Operating Loss Rules

Net operating losses are eligible to be carried forward 20 years & utilized to offset up to 80% of taxable income.

No effect on existing Mississippi law.

Limitation on Like-Kind Property Exchanges

Deferral of gain on like-kind exchanges allowed for real property.

Deferral of gain on like-kind exchanges allowed for real & personal property.

Increase in Section 179 Expensing

Provides for a deduction up to $1,000,000 for assets placed in service during the current tax year.

Provides for a deduction up to $1,000,000 for assets placed in service during the current tax year.

Increase in Bonus Depreciation

Provides a deduction of 100% of the cost of assets place in service during the current tax year.

No deduction for bonus depreciation.

Qualified Business Income Deduction

Non-corporate taxpayers are allowed a deduction from taxable income up to 20% of qualified business income.

No deduction is permitted on qualified business income, as the deduction did not arise from the activities of a trade of business.

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