If you are a Mississippi resident and earned income in another state and have to pay income taxes to that state, you are allowed to take a credit against your Mississippi income tax due for the same tax year for the amount you paid in taxes to the other state (this is subject to certain limitations). You MUST file a tax return with the other state for this credit to be allowed.
The limitations to take this credit are:
- The credit can't be greater than the income tax amount due to Mississippi.
The credit can't be greater than the amount of tax actually paid to the other state.
- The credit can't be greater than the amount computed by applying the highest applicable Mississippi rates to the taxable income (net) reported to the other state.
The program will automatically calculate this credit for your Resident Mississippi return when you create a Nonresident return in your account. If the other state return is a Part-Year Resident return, you will be required to enter the information asked of you within your Mississippi return.
If you need to override this credit, you can do so by following the steps below:
- State Section
- Credit for taxes paid to another state
For additional information, see the Mississippi instructions.