MS HB1668

Allows partnerships, S corporations, and similar pass-through entities to elect taxation at the entity level, with elections or revocations permitted any time during the tax year or by the return due date/filing date, whichever is latest

Requires owners, members, partners, or shareholders of electing pass-through entities to include their pro rata share of entity income in their individual gross income tax liability calculation

Provides individual taxpayers a credit equal to their pro rata share of tax paid by the electing pass-through entity, with any additional entity-level tax credits passing through to individuals on a pro-rata basis

Allows excess credits that exceed an individual's tax liability to be carried forward as an overpayment or refunded at the taxpayer's election

Election or revocation requires approval meeting the entity's governing document thresholds, or if none exist, by owners holding more than 50% voting control (plus governing body approval if applicable)

Effective January 1, 2023, applying to tax returns with original due dates on or after that date