MS HB929

Expands Mississippi income tax to apply to nonresidents' net income derived from property, activity, or other sources within Mississippi, replacing previous language limiting taxation to income "from" specific sources.

Broadens the definition of "doing business" in Mississippi to include regular solicitation of business from potential customers, performance of services outside Mississippi with benefits received in-state, franchising/licensing agreements, and transactions involving intangible personal property resulting in receipts flowing to nonresidents.

Establishes "valid business purpose" definition for interest and intangible expense deductions between related parties, requiring the transaction have a legitimate business purpose, economic substance, and arm's-length terms, with tax avoidance not being a significant motivation.

Revises business income classification rules to presume all income is business income unless the taxpayer can prove otherwise, and clarifies that income may be business income even if the actual transaction does not occur in Mississippi.

Takes effect January 1, 2019.