Crossing a state line into or out of Mississippi

Mississippi taxes its residents on income earned anywhere, and taxes non-residents on work done inside it. Which return you file depends on which direction you commute.

Mississippi borders 4 states. They fall into 2 different situations, and which one applies decides whether you file one return or two.

Where you file a nonresident return and claim a credit

Mississippi has no agreement with Alabama, Arkansas and Louisiana. Work in one of these and you file a nonresident return there, report the same income again to Mississippi, and claim a credit for what you already paid. The credit is capped at your Mississippi liability, so you are not taxed twice, the combined bill lands at roughly the higher of the two rates. On $70,000, Alabama costs the most at $3,460 and Arkansas the least at $2,800, $660 between them.

Work state	Its tax	Mississippi after credit	Total	Rate that governs
Alabama	$3,460	$0	$3,460	Alabama
Arkansas	$2,653	$148	$2,800	Mississippi
Louisiana	$1,475	$1,325	$2,800	Mississippi

Where the work state takes nothing

Tennessee levies no personal income tax, so there is no return to file there and no credit to claim. But Mississippi still taxes the wages as a resident. The catch is withholding: an employer in Tennessee has no state income tax to withhold, so nothing is taken out for Mississippi either. The liability is real and nothing is being set aside against it, which usually means Mississippi estimated payments.

What Mississippi itself takes across a salary range

A single filer, taking the standard deduction. This is the figure every arrangement above is measured against, the tax Mississippi charges a resident, whether the work happened inside the state or over a line:

Wages	Mississippi tax	Effective rate
$45,000	$1,800	4.00%
$70,000	$2,800	4.00%
$120,000	$4,800	4.00%

Coming the other way: living in a no-income-tax state, working in Mississippi

Tennessee border Mississippi and levy no personal income tax of their own. A resident of Tennessee who works in Mississippi has the simplest arrangement on this page and the least room to improve it: Mississippi taxes the wages earned inside it, $2,800 on $70,000, there is no home-state return, and so there is nothing to claim a credit against. Living across a border that charges nothing does not reduce the Mississippi bill by a cent.

Reciprocity cannot help either, even where Mississippi has agreements: reciprocity shifts the income to the home state's return, and a state with no income tax has no return to shift it to.

What Mississippi charges as your home state

Mississippi applies a single 4% rate to taxable income for 2026, so every extra dollar of wages is taxed at the same state rate.

On the 2026 rate itself: phasing down toward 0% if revenue triggers met.

State income tax on wages only, 2026 rates. Not tax advice, what this does and doesn't cover.