(MISSISSIPPI) Mississippi will apply a flat 4% individual income tax rate for tax year 2026 on taxable income above $10,000, while the first $10,000 of taxable income is taxed at 0%. For immigrants and other new residents, this change matters most when you set paycheck withholding, plan estimated payments, or compare offers across states.
The Mississippi Department of Revenue lists the 2026 rate as 4% on taxable income in excess of $10,000. Tax year 2026 generally covers income earned from January through December 2026, with returns usually filed in 2027. The practical effect is simple: once your Mississippi taxable income crosses $10,000, every additional dollar is taxed at 4% for state purposes.
2026 Mississippi rate structure now set in law
Mississippi moved away from multiple brackets and will use a single rate for 2026. The rule has two parts:
- 0% on the first $10,000 of taxable income
- 4% on taxable income over $10,000
That phrase “taxable income” does heavy work. It is not the same as wages on your pay stub, and it is not always the same as your federal adjusted gross income. Mississippi starts with income, then applies deductions and exemptions to reach taxable income. The 0% first layer applies only after you reach the taxable income figure on the state return.
Build-Up Mississippi Act timeline and what comes next
The 2026 rate is part of a multi-year phase-down approved in the Build-Up Mississippi Act, which Governor Tate Reeves signed on March 27, 2025. Under that law, Mississippi sets the 4% rate for calendar year 2026 and then schedules further reductions beginning in 2027.
Planned future rates in the law:
- 2027: 3.75%
- 2028: 3.50%
- 2029: 3.25%
- 2030 and thereafter: 3.00%, with later conditional reductions tied to revenue and spending triggers
For families weighing when to buy a home, switch jobs, or relocate, those future figures shape longer-term cost estimates. VisaVerge.com reports that state tax changes often affect where employers place foreign talent and where international graduates decide to start their careers, even when federal immigration rules stay the same.
Why this matters for immigrants, students, and cross-border workers
Most immigration journeys involve a period of fast change: a first job in the United States 🇺🇸, a new spouse, a new baby, or a move for a better role. State tax rules add another moving part.
A flat 4% rate above a $10,000 taxable income threshold changes planning in three common scenarios:
- New Mississippi residents who arrive mid-year for work, school, or family reasons often need to reconcile withholding with what they actually owe on a part-year return.
- Workers whose immigration status changes—for example, from student work authorization to an employer-sponsored job—often see pay and benefits shift quickly, which also shifts state taxable income.
- Households with mixed immigration documentation may need extra time to gather identity papers used for tax filing and payroll setup, especially in the first year.
None of these scenarios change the 2026 tax rate itself. They change the risk of under-withholding or over-withholding, which can create stress at filing time.
Important: These are planning concerns, not changes to the tax rate. The 4% / $10,000 structure is the rule for 2026; the primary risk is unexpected withholding or a surprise tax bill at filing.
Standard deductions and personal exemptions: planning numbers to confirm
Mississippi’s Department of Revenue publishes standard deduction and personal exemption amounts that affect how you get from income to taxable income. The department’s tables include examples such as:
- Standard deduction: $4,600 (married filing joint), $2,300 (single)
- Personal exemption: $12,000 (married filing joint), $6,000 (single)
These figures are useful for rough planning. They also change over time, so confirm the amounts listed for the year you will file. For immigrants, that confirmation step matters because payroll systems sometimes default to federal settings that do not match state rules.
Filing identity issues that come up for new arrivals
Many immigrants file taxes while they are still building a US paperwork trail. In practice, that can mean one spouse has a Social Security number and another needs an Individual Taxpayer Identification Number, or ITIN, for tax filing.
If an ITIN is needed, the federal application is IRS Form W-7, and the official instructions are on the IRS page for IRS Form W-7. While that is a federal form, getting the right tax identifier helps you file state returns correctly, report income consistently, and avoid delays when an employer or bank asks for matching records.
Employer withholding and paycheck math under a flat 4%
Employers generally set state withholding based on employee-provided information and payroll tables. A flat rate does not remove complexity, but it makes the marginal rate easier to explain.
Core logic for Mississippi tax year 2026:
- Estimate your Mississippi taxable income for the year after deductions and exemptions.
- If that figure is $10,000 or less, Mississippi individual income tax on that taxable income is 0%.
- If that figure is over $10,000, subtract $10,000 and multiply the remainder by 4%.
This is not a full return calculation, and it does not replace official worksheets. Still, it helps workers understand why a raise or a second job can increase withholding, even though the first $10,000 of taxable income stays tax-exempt.
Household and employer decisions that hinge on the 2026 rule
The 2026 structure often shows up in immigration-related decisions that are not really about tax policy, but end up shaped by it.
- A family deciding whether one spouse should pause work while waiting on an immigration document may compare the after-tax benefit of a short-term job.
- Under the Mississippi 2026 rule, the first $10,000 of taxable income is not taxed by the state, but earnings above that threshold face the 4% state rate.
- Employers recruiting international workers also watch these figures. Relocation offers frequently include cost-of-living comparisons, and state income tax is part of that. For a candidate choosing between Mississippi and a higher-tax state, a clear flat rate is easier to model in a contract discussion.
Recordkeeping that reduces filing-time surprises
The most common problem readers report is not the rate. It is mismatched records.
Keep a simple file—paper or digital—with:
- Year-end wage statements and any other income records
Carefully maintain and organize these documents to avoid mismatches between payroll, federal filings, and your Mississippi return.
Mississippi will adopt a flat 4% individual income tax rate in 2026 for taxable income above $10,000. This move, mandated by the Build-Up Mississippi Act, simplifies the state’s tax code and precedes further annual reductions reaching 3% by 2030. The policy affects payroll withholding and relocation planning, particularly for immigrants and cross-border workers navigating new residency and tax identification requirements.
