MS HB1945

Extends income tax credits for charitable contributions to business entities (corporations, LLCs, partnerships, and sole proprietorships) starting January 1, 2026, with a maximum credit of $2,400 per taxable year for contributions to qualifying charitable organizations.

Qualifying charitable organizations must be 501(c)(3) tax-exempt entities that spend at least 50% of their budget serving low-income Mississippi residents (below 150% federal poverty level), TANF recipients, or children with chronic illness or disabilities.

Organizations that provide, pay for, or financially support abortion services are explicitly excluded from qualifying as charitable organizations under this credit.

The aggregate cap on tax credits increases from $1,000,000 (2021-2025) to $3,000,000 for calendar year 2026 and thereafter.

Unused tax credits may be carried forward for five consecutive years, and pass-through entity credits are allocated among partners, members, or shareholders based on ownership interest or mutual agreement.