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Julie Garber

Estate Taxes by State - Does Mississippi Have an Estate Tax?

By November 14, 2009

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Does Mississippi have an estate tax? The answer is no, Mississippi currently does not collect an estate tax, although things were different a few years ago before major changes took effect with regard to federal estate tax laws. Prior to January 1, 2005, Mississippi, like many other states, collected a separate state estate tax, called a "pick up tax," that was actually equal to a portion of the overall federal estate tax bill.

On January 1, 2005, the pick up tax was officially phased out under the provisions of the Economic Growth and Tax Relief Reconciliation Act ("EGTRRA"). In response to these changes in federal law, 18 states and the District of Columbia chose to enact laws that allow the assessment of a local estate tax. But the Mississippi legislature did nothing and as a result Mississippi no longer collects a state estate tax.

One thing to keep in mind is that the pick up tax is scheduled to come back in 2011 due to the sunset of EGTRRA, and if this happens then the Mississippi estate tax will come back. Of course, no one really believes that Congress and President Obama will allow EGTRRA to sunset. Instead, it is anticipated that at the very least a one year patch will be enacted that will keep the federal estate tax in place and possibly bring back the pick up tax, which has already been proposed by H.R. 2023, introduced by Rep. Jim McDermott (D-WA) in April 2009.

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