MS HB543

Expands Mississippi income tax on nonresidents to include net income derived from property, activity, or other sources within Mississippi, broadening the tax base beyond just business income.

Revises the definition of "doing business" to include regular solicitation of business from potential customers, issuance of credit/debit cards to Mississippi customers, performance of services outside Mississippi with benefits received within the state, franchising agreements, and transactions involving intangible personal property.

Defines "valid business purpose" as business motivation that improves the taxpayer's economic position apart from tax effects, and requires transactions with related members to have economic substance, arm's-length terms, and cannot have tax avoidance as a significant motivation.

Restricts deductions for intangible expenses and interest paid to related members unless the related member paid it to an unrelated party in the same year or the transaction meets the valid business purpose standard and arm's-length pricing requirements.

Effective January 1, 2020.