ms-income-tax

Mississippi Individual Income Tax Skill — Self-Employed / Sole Proprietor

Scope. This skill covers Mississippi Form 80-105 for full-year Mississippi residents who are sole proprietors or single-member LLC owners. Mississippi uses a near-flat tax: 0% on the first $10,000 of taxable income, 4.4% on income above $10,000 (TY 2025). The rate drops to 4.0% for TY 2026, with further reductions planned through 2030+.

Quality tier. Q3 — AI-drafted, not independently verified. All rates and thresholds were researched on 2026-05-22 from official Mississippi Department of Revenue publications. A qualified professional must review before filing.

Section 1: Metadata

Metadata table

Field	Value
Jurisdiction	Mississippi (US-MS)
Tax type	Individual income tax
Primary form	Form 80-105 (Resident Individual Income Tax Return)
Tax year	2025 (filed in 2026) / 2026
Authority	Mississippi Department of Revenue (MSDOR)
Statute	Miss. Code Ann. § 27-7-5 et seq.
Version	0.1
Last updated	2026-05-22
Validation	AI-drafted — Q3

Sources consulted

Sources consulted table

#	Source	URL
1	Mississippi DOR — Tax Rates	https://www.dor.ms.gov/individual/tax-rates
2	Mississippi DOR — General Information	https://www.dor.ms.gov/general-information
3	Miss. Code Ann. § 27-7-5 (rate statute)	https://law.justia.com/codes/mississippi/title-27/chapter-7/section-27-7-5/
4	Build-Up Mississippi Act (income tax phase-out)	https://www.ntu.org/foundation/detail/mississippi-moves-to-end-individual-income-taxheres-what-taxpayers-need-to-know

Section 2: Quick reference — rates and thresholds

Tax rates (all filing statuses)

Tax rates table

Tax year	First $10,000	Over $10,000
2025	0%	4.4%
2026	0%	4.0%
2027	0%	3.75%

Mississippi applies the same rate structure to all filing statuses (single, MFJ, MFS, HoH).

Standard deduction — 2025

Standard deduction table

Filing status	Amount
Single	$2,300
MFJ / Combined	$4,600
MFS	$2,300 (each)
Head of Family	$3,400

Personal exemptions — 2025

Personal exemptions table

Filing status	Amount
Single	$6,000
MFJ	$12,000
MFS	$6,000 (each)
Head of Family	$8,000
Each dependent	$1,500
Blind taxpayer/spouse	$1,500 additional

Key thresholds

Key thresholds table

Item	Value	Source
Filing deadline	April 15, 2026 (for TY 2025)	Miss. Code Ann. § 27-7-41
Extension	Automatic 6-month with federal extension	MSDOR policy
Estimated tax threshold	$200 expected liability after withholding and credits	Miss. Code Ann. § 27-7-320

Section 3: How this skill works with the federal return

• Separate computation process — Mississippi taxable income is computed independently from the federal return — Mississippi does NOT start from federal AGI. Instead: 1. Report all income — Wages, self-employment income, interest, dividends, capital gains, rental income, etc. are reported directly on Form 80-105 and supporting schedules. 2. Adjustments — Mississippi allows its own adjustments (e.g., deduction for 50% of self-employment tax, contributions to MS retirement plans). 3. Deductions — Apply the Mississippi standard deduction OR Mississippi itemized deductions. 4. Personal exemptions — Subtract personal exemptions ($6,000 single, $12,000 MFJ, etc.). 5. Mississippi taxable income — Gross income − adjustments − deductions − exemptions. 6. Tax — 0% on first $10,000; 4.4% on excess (TY 2025). 7. Credits — Apply applicable credits. Key difference: Mississippi is a "separate computation" state. It does NOT piggyback on federal AGI or federal taxable income. The taxpayer must independently compute Mississippi income. (unsure)

Section 4: Self-employed specific rules

• Self-employment income reporting — Report net business income on Form 80-105 directly. Mississippi recognizes the same business income and expenses as the federal return in most cases, but the starting point is gross income, not federal AGI. (unsure)
• Self-employment tax deduction — Mississippi allows a deduction for 50% of self-employment tax paid, mirroring the federal deduction. (unsure)
• Estimated taxes — Self-employed taxpayers must make quarterly estimated payments if expected liability exceeds $200. Due dates: April 15, June 15, September 15, January 15. (unsure)
• Business equipment depreciation — Mississippi generally follows federal depreciation rules, including IRC § 179 expensing. Check conformity for bonus depreciation (IRC § 168(k)). (unsure)
• Health insurance deduction — Self-employed health insurance premiums are deductible for Mississippi purposes, consistent with the federal deduction. (unsure)
• No local income tax — Mississippi does not permit local income taxes. (unsure)

Section 5: Tier 1 rules — deterministic

Tier 1 rules table (see rows)

Rule ID	Rule	Source
MS-T1-01	Compute Mississippi gross income independently (do not start from federal AGI)	Miss. Code Ann. § 27-7-15
MS-T1-02	Apply 50% self-employment tax deduction	Miss. Code Ann. § 27-7-17
MS-T1-03	Apply standard deduction: $2,300 (single), $4,600 (MFJ), $3,400 (HoF)	Miss. Code Ann. § 27-7-17
MS-T1-04	Apply personal exemptions: $6,000 (single), $12,000 (MFJ), $8,000 (HoF)	Miss. Code Ann. § 27-7-21
MS-T1-05	Apply dependent exemptions: $1,500 per qualifying dependent	Miss. Code Ann. § 27-7-21
MS-T1-06	First $10,000 of taxable income: 0%	Miss. Code Ann. § 27-7-5
MS-T1-07	Taxable income over $10,000: 4.4% (TY 2025) / 4.0% (TY 2026)	Miss. Code Ann. § 27-7-5
MS-T1-08	Interest on U.S. government bonds: exempt from Mississippi tax	Miss. Code Ann. § 27-7-15
MS-T1-09	Social Security benefits: fully exempt from Mississippi tax	MSDOR guidance
MS-T1-10	Mississippi does not tax retirement income from MS public retirement systems	Miss. Code Ann. § 27-7-15

Section 6: Tier 2 rules — requires judgment

Tier 2 rules table (see rows)

Rule ID	Rule	Guidance
MS-T2-01	Residency determination — Mississippi uses a domicile test. A person domiciled in Mississippi or spending 183+ days in the state is a resident.	If taxpayer has homes in multiple states, flag for professional review.
MS-T2-02	Separate computation — Mississippi does not start from federal AGI. Verify that all income items are independently reported on Form 80-105.	Cross-check against federal return to ensure nothing is missed.
MS-T2-03	Itemized deductions — Mississippi allows itemized deductions similar to federal Schedule A but with Mississippi-specific limits.	Compare MS itemized vs. standard deduction to choose the better option.
MS-T2-04	Credit for taxes paid to other states — Available to prevent double taxation on income earned in other states.	Requires the other state's return.
MS-T2-05	Income tax phase-out — Rate drops annually (4.4% → 4.0% → 3.75% → ...) with potential full elimination. Confirm the applicable rate for the tax year.	Check MSDOR for the current-year rate before filing.
MS-T2-06	Bonus depreciation conformity — Mississippi's conformity to IRC § 168(k) should be verified for the tax year.	Compare MS conformity date to asset placed-in-service date.

Section 7: Supplier pattern library

Supplier pattern library table (see rows)

Pattern	Treatment	Notes
W-2 wages from Mississippi employer	MS withholding applies; report on Form 80-105	Most common
Schedule C net profit (sole prop)	Report directly on Form 80-105	Independent computation
Rental income	Report on Form 80-105	MS-source if property in MS
Interest on U.S. government bonds	Exempt from Mississippi tax	Miss. Code Ann. § 27-7-15
Interest on non-MS muni bonds	Taxable for MS purposes	Report as income
Social Security benefits	Fully exempt from Mississippi tax	Do not include
Capital gains from asset sale	Report on Form 80-105	No special MS rate
1099-NEC freelance income	Report directly on Form 80-105	Estimated payments likely needed

Section 8: Form mapping

Form mapping table (see rows)

Mississippi form / schedule	What it covers	Federal counterpart
Form 80-105	Resident Individual Income Tax Return	Form 1040
Form 80-205	Non-Resident / Part-Year Resident Return	Form 1040
Form 80-106	Individual Income Tax Adjustments	Schedule 1 (Form 1040)
Form 80-107	Income Tax Credits Summary	N/A
Form 80-108	Schedule of Deductions (Itemized)	Schedule A (Form 1040)
Form 80-320	Estimated Tax Declaration	Form 1040-ES

Section 9: Refusal catalogue

Refusal catalogue table (see rows)

ID	Situation	Action
MS-R-01	Part-year or non-resident return (Form 80-205)	Refuse — out of scope
MS-R-02	Corporate income tax (Form 83-100)	Refuse — out of scope
MS-R-03	Corporate franchise tax	Refuse — out of scope
MS-R-04	Multi-state income apportionment	Refuse — flag for professional review
MS-R-05	Amended returns	Refuse — out of scope
MS-R-06	Tax year other than current	Refuse — rates change annually during phase-out
MS-R-07	Partnership / S-corp pass-through returns	Refuse — out of scope

Disclaimer

This skill and its outputs are provided for informational and computational purposes only and do not constitute tax, legal, or financial advice. Open Accountants and its contributors accept no liability for any errors, omissions, or outcomes arising from the use of this skill. All outputs must be reviewed and signed off by a qualified professional before filing or acting upon.

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