MS SB2208

Authorizes Mississippi taxpayers in coastal areas to establish catastrophe savings accounts to pay insurance deductibles and uninsured losses from hurricanes, floods, or catastrophic windstorms on their primary residences.

Excludes contributions to catastrophe savings accounts, interest earned on these accounts, and distributions used for qualified catastrophe expenses from state taxable gross income.

Sets contribution limits based on insurance deductible amount: $2,000 for deductibles of $1,000 or less; up to $15,000 for higher deductibles; and up to $250,000 for uninsured individuals (not exceeding home value).

Imposes an additional 2.5% state income tax on taxable distributions from catastrophe savings accounts that are not used for qualified catastrophe expenses, except for account holders age 70+ or those no longer owning qualifying coastal residences.

Protects catastrophe savings account assets from attachment, levy, garnishment, and legal process; grants surviving spouses inheritance rights without tax penalty; and takes effect January 1, 2014.