Mississippi Subtractions From Income

Pension Income from Federal, State and Private Retirement Systems

Retirement income is exempt from Mississippi income tax. This includes:

• Railroad Retirement benefits
• Distributions from federal retirement systems
• Distributions from state retirement systems
• Distributions from private retirement systems

National Guard or Reserve Pay

You may subtract the compensation received for National Guard or Reserve service, or the $15,000 statutory exclusion per taxpayer, whichever is less.

Prepaid Affordable College Tuition (MPACT) Contributions AND/OR Affordable College Savings (MACS) Contributions

You may subtract:

• Contributions to a Mississippi Prepaid Affordable College Tuition (MPACT) program, and/or
• Contributions to a Mississippi Affordable College Savings (MACS) account for a qualified beneficiary

The maximum annual MACS deduction is:

• $20,000 for Married Filing Jointly taxpayers
• $10,000 for all other filing statuses

Only contributions made to MPACT and MACS qualify for this subtraction.

Self-Employed Health Insurance

If you claimed the self-employed health insurance deduction on your federal return, you may also claim the amount allowed on your federal return as a Mississippi subtraction.

Interest Penalty on Early Withdrawal of Savings

You may subtract penalties reported on Form 1099-INT for the early withdrawal of funds from a time savings account before maturity.

Catastrophe Savings Account Deduction

Under the Catastrophe Savings Account Act, you may subtract contributions made to a qualified catastrophe savings account, plus any accrued interest.

If contributions are both made and withdrawn during the same tax year, net the deposits and withdrawals to determine the deductible amount. Amounts withdrawn for purposes other than qualified catastrophe expenses must be included in gross income.

Self-Employment Tax deduction

You may subtract up to 50% of the federal self-employed tax imposed on your gross income.

First-time Home Buyers Savings Account Deduction

You may subtract contributions made to a qualified first-time home buyers savings account, plus any accrued interest as defined by the First-Time Home Buyers Savings Act.

If an amount was withdrawn but was not used to pay for eligible expenses, the amount should be reported on Form 80-108, Schedule N.

Agricultural Disaster Program Compensation

Compensation received from a qualifying agricultural disaster program may be subtracted from income.

ABLE Act Deductions

You may subtract contributions made to a qualified ABLE savings account.

Alimony and Separate Maintenance Paid

You may deduct alimony and separate maintenance payments to the extent they are allowable for federal income tax purposes.

Program Entry

1. State Section
2. Mississippi Return
3. Subtractions from Income

Additional Information

• Mississippi's Income Tax Instructions