State-by-State Guide to Taxes on Retirees
Tool | December 2021

Mississippi State Tax Guide for Retirees

State tax rates and rules for income, sales, property, estate, and other taxes that impact retirees.


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The Bottom Line
Flag of Mississippi


The tea is sweet in the Magnolia State, and so is the income tax environment for retirees. Mississippi not only exempts Social Security benefits from state income tax, but it also excludes withdrawals from IRAs and 401(k) plans, income from public and private pensions, and other types of qualified retirement income.

Mississippi's state sales tax rate of 7% is tied for the second-highest in the U.S. (only California, at 7.25%, is higher), and Mississippi is one of a minority of states that charges sales tax on groceries. But localities add very little, if anything, on top of the state's rate.

Property taxes on residential real estate aren't too bad, either. Mississippi's median annual property tax rate is well below the U.S. average.

Income Tax Range

Low: 3% (on taxable income from $4,001 to $5,000)

High: 5% (on taxable income over $10,000)

Beginning in 2022, there is no tax on the first $5,000 of taxable income. The lowest rate will be 4% on taxable income from $5,001 to $10,000.

Starting in 2023, there is no tax on the first $10,000 of taxable income. The tax rate on taxable income above $10,000 will be reduced to 4.7% in 2024, 4.4% in 2025, and 4% in 2026 and thereafter.

Taxation of Social Security Benefits

Social Security benefits are not taxed by the state.

Tax Breaks for Other Retirement Income

Income from private employer, government, and military retirement plans is exempt.

Railroad Retirement benefits are also exempt.

Sales Tax

7% state levy. Only two localities, Jackson (1%) and Tupelo (0.25%) add to that. According to the Tax Foundation, that makes for an average combined rate of 7.07%.

Groceries: Taxable
Clothing: Taxable
Motor Vehicles: Taxable (5%)
Prescription Drugs: Exempt

Real Property Taxes

For homeowners 65 and older or totally disabled, there is an exemption on the first $75,000 of value.

Annual Car Taxes and Fees

An annual vehicle property tax based on the car's age and value is imposed. Rates are set at the county level. Values are determined by the State Tax Commission using information from a nationwide valuation service.

Estate and Inheritance Taxes

No estate or inheritance tax.