Mississippi Sales Tax Payment Plan & Resolution
Checklist
Sales tax compliance in Mississippi requires regular filing and payment of sales tax collected from customers. Mississippi offers an individual income tax installment agreement program for taxpayers who cannot pay income tax liabilities in full. Still, business sales tax payment arrangements operate differently through case-by-case negotiation with the Collections Division.
Understanding the distinction between these programs helps prevent confusion about available options. Ignoring unpaid sales tax or failing to respond to state notices can result in liens, levies, or permit revocation through formal enforcement procedures.
What Individual Income Tax Installment Agreements
Mean
Mississippi Form 71-661 provides a formal installment agreement exclusively for individual income tax liabilities of at least seventy-five dollars. This program allows taxpayers to pay income tax debt over twelve months for amounts between seventy-five and three thousand dollars, or sixty months for amounts exceeding three thousand dollars, with an approved
Internal Revenue Service installment agreement.
The agreement requires the timely filing of the tax return by the original or extended due date.
Form 71-661 must be attached to the front of the individual income tax return when submitted to
the Mississippi Department of Revenue.
Business Sales Tax Payment Arrangements
Business sales tax payment arrangements differ from individual income tax installment agreements because Mississippi does not publish a formal business sales tax payment plan program with standardized forms or documented procedures. The Collections Division handles business tax payment requests on a case-by-case basis after audit determinations or delinquencies occur.
Tax professionals report that typical arrangements require approximately one-third down payment with the remaining balance paid over six months, but these terms represent common practice rather than published policy. Contact the Collections Division directly to discuss payment options for business sales tax liabilities.
Mississippi Sales Tax Collection Procedures
Mississippi Code section 27-65-57 establishes the legal framework for sales tax collection enforcement when taxpayers fail to pay after receiving notice and demand. Upon non-payment, the Commissioner of Revenue may file a notice of tax lien with the circuit clerk of the county where the taxpayer resides or owns property, and the clerk enrolls this notice as a judgment on the judgment roll.
This enrolled judgment becomes valid against mortgagees, purchasers, judgment creditors, and other persons from the filing date, creating a lien on all property and rights to property belonging to the taxpayer. As authority for remedial action, the judgment enables issuance of writs of execution, attachment, garnishment, or other remedial writs, and the lien remains valid for seven years from filing unless refiled or satisfied.
Interest and Penalties Under the Mississippi Code
Mississippi Code section 27-65-39 governs interest rates and penalties for deficient or delinquent sales tax. Interest accrues at one-half of one percent per month for taxes assessed on or after January 1, 2019. Penalties of ten percent may be added to deficiencies resulting from negligence or failure to comply with sales tax provisions without intent to defraud.
Additional penalties of ten percent for late payment are charged sixty days after the due date or when a warrant for collection is issued. Interest continues to accrue on unpaid amounts during any payment arrangement period, increasing the total debt owed over time.
Sales Tax Permit Revocation Authority
Mississippi Code section 27-65-27 authorizes the Commissioner of Revenue to deny permit applications or revoke existing permits when permit holders fail to comply with sales tax provisions. Revocation represents a discretionary enforcement action rather than an automatic consequence of non-payment.
The Mississippi Department of Revenue provides notice of intended revocation and opportunity for a hearing before finalizing permit revocation decisions. Revocation prevents the permit holder from legally engaging in business activities subject to sales tax until compliance is restored and required bonds are filed.
Steps for Individual Income Tax Installment Agreements
Taxpayers seeking individual income tax installment agreements should follow these
procedures
1. Verify that your tax liability meets Form 71-661 eligibility requirements of at least seventy-five dollars for timely filed returns.
2. Confirm that you and your spouse have filed all required income tax returns and paid all taxes due for the past five years.
3. Complete Form 71-661 with your account information, total amount owed, proposed monthly payment, and banking details.
4. Attach Form 71-661 to the front of your individual income tax return when filing.
5. Mail the return and form together to the Mississippi Department of Revenue at the address provided in the instructions.
Steps for Business Sales Tax Payment Discussions
Business taxpayers facing sales tax liabilities should contact the Collections Division directly because no standardized form exists for business sales tax payment requests. Prepare financial documentation showing your business income and ability to make monthly payments before contacting the department.
Request a discussion of payment arrangement options and be prepared to negotiate down payment amounts and payment schedules. Document all agreements in writing and maintain records of every payment made, including dates, amounts, and confirmation numbers. Continue filing current sales tax returns on time while addressing past liabilities to avoid additional enforcement actions.
Common Mistakes to Avoid
Missing payment deadlines can result in termination of individual income tax installment agreements or escalation of collection efforts for business sales tax arrangements. Failing to file current returns while addressing past liabilities creates new delinquencies and triggers additional penalties.
Sending payments to incorrect addresses or using unapproved payment methods may result in processing delays or misapplication of funds. Taxpayers who do not respond to follow-up notices from the Collections Division risk having arrangements cancelled or liens filed.
Maintaining accurate records of all payments, correspondence, and agreements protects taxpayers if disputes arise about payment history or account balances.
Compliance Overview
Mississippi provides a documented individual income tax installment agreement program through Form 71-661 for qualifying taxpayers, while business sales tax payment arrangements require direct negotiation with the Collections Division. Understanding the legal framework for collection procedures under Mississippi Code sections 27-65-57 and 27-65-39 helps taxpayers recognize the consequences of non-payment.
Form 71-661 serves individual income tax filers who meet specific eligibility criteria and file timely returns. Taxpayers facing permit revocation or collection actions should contact the department promptly to discuss resolution options before liens are filed or permits are suspended.
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.
We help with
- State enforcement actions and notices
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