State-by-State Guide to Taxes on Retirees - Mississippi
Tool | November 2018

State-by-State Guide to Taxes on Retirees


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The Bottom Line
Map of Mississippi

Most Tax-Friendly

One of Kiplinger’s top ten most tax-friendly states for retirees, the Magnolia State offers a sweet income tax deal for retirees. It not only exempts Social Security benefits from state income taxes, but it also excludes all qualified retirement income. Remaining income is taxed at a maximum 5%. Plus, on property taxes, seniors qualify for a homestead exemption on the first $75,000 of value.

State 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%. Mississippi is one of a minority of states that tax groceries.

Income Tax Range

Low: 3% (on taxable income of $1,000 or more)

High: 5% (on more than $10,000 of taxable income)

Income tax rates are being gradually reduced. By 2022, the first $5,000 of taxable income will be exempt.

Social Security

Benefits are not taxed.

Exemptions for Other Retirement Income

Qualified retirement income — including income from IRAs, 401(k)s, 403(b)s, Keoghs, and qualified public and private pension plans — is exempt from state income tax. (Early distributions are not considered retirement income and may be subject to tax.) Railroad Retirement benefits are not taxed.


Exempt from state income tax.

401(k)s and Other Defined-Contribution Employer Retirement Plans

Exempt from state income tax.

Private Pensions

Exempt from state income tax.

Public Pensions

Exempt from state income tax.

Property Taxes

The median property tax on Mississippi’s median home value of $105,700 is $841.

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

Vehicle Taxes

Vehicle sales are taxed at 5%, which is 2% below the general rate. Mississippi also charges an annual property tax on vehicles based on their age and value. Rates for this tax are set at the county level. In Lafayette County, for example, you’d pay $285 on a vehicle valued at $20,000.

Inheritance and Estate Taxes


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