Mississippi Tax Collection and Payment Plan
Checklist
Understanding Mississippi Tax Collection Procedures
The Mississippi Department of Revenue follows specific statutory procedures when collecting unpaid income taxes. When a taxpayer fails to pay taxes after filing a return, the Commissioner mails or hand delivers an assessment that constitutes notice and demand for payment under
Mississippi Code Section 27-7-53.
Taxpayers receive sixty days from the date of this notice to pay the tax due, including penalties and interest, or to appeal to the Board of Review. Failure to pay within sixty days triggers collection actions authorized under Mississippi Code Sections 27-7-55 through 27-7-67.
Collection enforcement may include filing a notice of tax lien with the circuit clerk, which creates an enrolled judgment on the judgment roll. This enrolled judgment serves as authority for issuing writs of garnishment, execution, attachment, or other remedial writs.
Payment Plan Eligibility and Requirements
Mississippi offers installment agreements to qualifying taxpayers through the Department of
Revenue payment plan program. Two types of installment agreements exist based on the liability amount and specific circumstances.
Individual taxpayers with a liability between seventy-five dollars and three thousand dollars may request to pay through a twelve-month installment agreement. Those owing more than three thousand dollars qualify for a sixty-month installment agreement only if they have entered into an installment agreement with the Internal Revenue Service to pay federal income taxes on income earned during the same taxable year.
Taxpayers must meet strict eligibility requirements to qualify for either payment plan option
- The return must be filed on or before the due date or any extensions allowed.
- The installment agreement request form must be submitted with the return.
- All required returns must have been filed during the preceding five years.
- All required taxes must have been paid during the preceding five years.
- No installment agreement must have been entered into during the preceding five years.
Interest continues to accrue at one-half of one percent per month during the installment agreement period for taxes assessed on or after January 1, 2019. The Department may terminate the agreement if the taxpayer provides inaccurate information, fails to pay installments when due, fails to pay other tax liabilities, or fails to provide required financial statements.
Tax Lien Procedures and Property Claims
When taxpayers fail to pay after receiving notice and demand, the Commissioner may file a notice of tax lien with the circuit clerk of the county where the taxpayer resides or owns property.
Upon receipt, the chancery clerk enters the taxpayer's name as judgment debtor and the
Department of Revenue as judgment creditor on the judgment roll.
This judgment becomes valid against mortgagees, pledgees, purchasers, judgment creditors, and other persons from the time of filing with the clerk. Seven years from the filing date, the lien expires unless action is brought before expiration or the Commissioner refiles the notice.
State tax liens may be refiled indefinitely in seven-year increments. All enrolled liens against taxpayers who owe any tax administered or enforced by the Department appear in the State Tax
Lien Registry.
Wage Garnishment for Tax Debts
Mississippi law permits the Department of Revenue to garnish wages for unpaid taxes through the enrolled judgment process. Under Mississippi Code Section 85-3-4, wages are normally exempt from garnishment for thirty days from the date of service.
Tax debts are specifically exempt from this thirty-day protection period under Section
85-3-4(3)(a)(ii). After the initial exemption period expires, the maximum garnishment amount is the lesser of twenty-five percent of disposable earnings or the amount by which disposable earnings exceed thirty times the federal minimum hourly wage.
Garnishment for tax debts does not require traditional court litigation because the enrolled judgment serves as the legal authority. The Department may issue warrants for collection directly from these judgments instead of remedial writs issued by the circuit clerk.
Responding to Collection Actions
Taxpayers who receive an assessment notice should verify the accuracy of the amount owed by contacting the Department of Revenue. Request an itemized breakdown showing principal tax, penalties, interest, and other charges to confirm the current balance.
Gather copies of all prior tax returns, payment receipts, cancelled checks, and payment confirmations for the relevant tax years. Contact the collections division or the phone number listed on the notice to discuss available options.
Ask whether payment plans are available and whether enforcement action will be deferred if a payment arrangement is proposed. Request written confirmation of any agreements or deferrals discussed during these conversations.
Submit all payment plan requests in writing via certified mail with a return receipt requested.
Include documentation of your financial situation if requesting an installment agreement based on inability to pay.
The Department reviews payment plan proposals and financial information to determine approval. Approved payment plans suspend enforcement action while payments are made according to agreed terms, but enforcement may resume if agreed payments are not made or if other tax liabilities become due and remain unpaid.
Facing State Enforcement or Payroll Tax Issues?
If you’ve received a state tax notice and aren’t sure how to respond, we can help you review your options and next steps.
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