Credits Available for Contributions to Qualifying Charitable Organizations (QCO) & Qualifying Foster Care Charitable Organizations (QFCCO)

An income tax credit is available for voluntary cash contributions to a qualifying charitable organization (QCO) or a qualifying foster care charitable organization (QFCCO). Miss. Code Ann. § 27-7-22.39. Each credit has different requirements related to which organizations can qualify and how credits are allocated to each taxpayer. Please see the information related to each credit type below.

Information for QCO Credits

Total Maximum Allocation: $1,000,000 (aggregate with QFCCO credits)

Who can Qualify as an QCO: Organizations that are exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code or are a designated community action agency that receives community services block grant program monies pursuant to 42 USC 9901. The organization must spend at least fifty percent (50%) of its budget on services to residents of this state who receive temporary assistance for needy families benefits or low-income residents of this state and their households or to children who have a chronic illness or physical, intellectual, developmental or emotional disability who are residents of this state.

Who can Apply for an Allocation of Credit: Individual Taxpayers

Tax-Types that Credit can be used against: Income Tax (credit limited to lesser of $1,200 or amount of contribution (Single or Head of Household), lesser of $2,400 or amount of contribution (Married Filing Jointly)), Ad Valorem Tax (50% of real property tax liability)

Carry Forward: 5 years

Other Limitations: Contribution cannot be used for other state charitable credits and cannot be used as a deduction for state income tax purposes

Information for QFCCO Credits

Total Maximum Allocation: $1,000,000 (aggregate with QCO credits)

Who can Qualify as an QFCCO: Organizations that provide services to at least one hundred (100) qualified individuals in this state and spend at least fifty percent (50%) of its budget on services to qualified individuals in this state. A "qualified individual" means a child in a foster care placement program established by the Department of Child Protection Services, a child placed under the Safe Families for Children model, or a child at significant risk of entering a foster care placement program established by the Department of Child Protection Services. 

Who can Apply for an Allocation of Credit: Individual Taxpayers

Tax-Types that Credit can be used against: Income Tax (credit limited to lesser of $1,500 or amount of contribution (Single or Head of Household), lesser of $3,000 or amount of contribution (Married Filing Jointly)), Ad Valorem Tax (50% of real property tax liability)

Carry Forward: 5 years

Other Limitations: Contribution cannot be used for other state charitable credits and cannot be used as a deduction for state income tax purposes

How to Qualify as a Qualifying Charitable Organization

 
 
Steps to Qualify with the Department

To qualify as a QCO, the organization must submit a letter ruling request to the Mississippi Department of Revenue, including the following:

  1. Contact information including phone number, email address, mailing address, and physical location if different.
  2. A copy of the exemption letter from the IRS verifying the organization qualifies under Section 501(c)(3) of the Internal Revenue Code or verification that the organization is a designated community action agency under 42 USC 9901.
  3. An operating budget for the prior year.  
  4. A list of services provided by the organization. Qualifying services mean (1) cash assistance, medical care, child care, food, clothing, shelter, and job-placement services or any other assistance that is reasonably necessary to meet immediate basic needs and that is provided and used in this state; (2) job-training or education services or funding for parents, foster parents or guardians; or (3) job-training or education services or funding provided as part of a foster care independent living program.
  5. A detailed schedule of total expenses for the prior year with a breakout of amounts expended on services to residents of this state who:  
    1. Receive temporary assistance for needy families benefits,
    2. Are low-income (household income is less than one hundred fifty percent (150%) of the federal poverty level) residents of this state, and/or
    3. Are children who have a chronic illness or physical, intellectual, developmental or emotional disability.
  6. The total number of individuals who received services from the organization in the prior year.  
  7. The total number of Mississippi residents who received services in the prior year and meet the criteria in number 5 above.
  8. A copy of the organization's prior year Federal income tax return and financial statements.  
  9. A statement that the organization plans to continue spending at least fifty percent (50%) of its budget on services to individuals who meet the criteria in number 5 above.
  10. Charitable organizations that do not spend at least fifty percent (50%) of their overall budget in Mississippi may still qualify if they meet all other requirements for a QCO. These organizations must submit a statement that they spend at least fifty percent (50%) of their Mississippi budget on services to qualified individuals in Mississippi and that one hundred percent (100%) of the voluntary cash contributions they receive from Mississippi taxpayers will be spent on services to qualified individuals in Mississippi.
  11. A statement that the organization does not provide, pay for or provide coverage of abortions and does not financially support any other entity that provides, pays for or provides coverage of abortions.
  12. A statement that the organization meets all criteria to be considered a QCO signed by an officer of the organization under penalties of perjury.
A letter acknowledging the approval or denial of the organization as a QCO will be issued.
Listing of Currently Qualified QCOs

Listing of QCOs​

How to Qualify as a Qualifying Foster Care Charitable Organization

 
 
Steps to Qualify with the Department

To qualify as a QFCCO, the organization must submit a letter ruling request to the Mississippi Department of Revenue, including the following:

  1. Contact information including phone number, email address, mailing address, and physical location if different.
  2. A copy of the exemption letter from the IRS verifying the organization qualifies under Section 501(c)(3) of the Internal Revenue Code.
  3. An operating budget for the prior year.  
  4. A list of services provided by the organization. Qualifying services mean (1) cash assistance, medical care, child care, food, clothing, shelter, and job-placement services or any other assistance that is reasonably necessary to meet immediate basic needs and that is provided and used in this state; (2) job-training or education services or funding for parents, foster parents or guardians; or (3) job-training or education services or funding provided as part of a foster care independent living program.
  5. A detailed schedule of total expenses for the prior year with a breakout of amounts expended on services to qualified individuals in Mississippi who:  
    1. Are children in a foster care placement program established by the Department of Child Protection Services,
    2. Are children placed under the Safe Families for Children model, and/or
    3. Are children at significant risk of entering a foster care placement program established by the Department of Child Protection Services.
  6. The total number of individuals who received services from the organization in the prior year.  
  7. The total number of qualified individuals who received services in the prior year and meet the criteria in number 5 above.
  8. A copy of the organization's prior year Federal income tax return and financial statements.  
  9. A statement that the organization plans to continue spending at least fifty percent (50%) of its budget on services to individuals who meet the criteria in number 5 above.
  10. Charitable organizations that do not spend at least fifty percent (50%) of their overall budget in Mississippi may still qualify if they meet all other requirements for a QFCCO. These organizations must submit a statement that they spend at least fifty percent (50%) of their Mississippi budget on services to qualified individuals in Mississippi and that one hundred percent (100%) of the voluntary cash contributions they receive from Mississippi taxpayers will be spent on services to qualified individuals in Mississippi.
  11. A statement that each operating year it provides services to at least one hundred (100) qualified individuals in this state.
  12. A statement that the organization does not provide, pay for or provide coverage of abortions and does not financially support any other entity that provides, pays for or provides coverage of abortions.
  13. A statement that the organization meets all criteria to be considered a QFCCO signed by an officer of the organization under penalties of perjury.
A letter acknowledging the approval or denial of the organization as a QFCCO will be issued.
Listing of Currently Qualified QFCCOs

Listing of QFCCOs​

How To Apply for Credits for Contributions to QCOs and QFCCOs

Individuals must have their contribution(s) certified by completing the appropriate application below and sending it to the Department for review. Instructions are included in the applications. A letter response to the application will be sent within 30 days after receipt.

Information related to claiming the credit, once approved, will be provided in the approval letter.