Mississippi Salary Paycheck Calculator
Seemingly endless tax forms, deadlines, and tax rates can be overwhelming. Don’t worry, Mississippi employers, we’ve answered the most frequently asked questions about payroll taxes and paycheck rules in Mississippi. Keep reading!
Mississippi state payroll taxes
How is Mississippi’s withholding tax calculated?
Mississippi employees need to pay their state income tax bill throughout the year via payroll withholdings.
As an employer, you’ll need to have employees complete Form 89-350, Mississippi Employee’s Withholding Exemption Certificate. They should complete the form when they start working for you and review it each year for changes. If their tax situation changes, they’ll need to complete a new form.
With the information provided on Form 89-350, and Mississippi’s tax tables, you’ll be able to calculate the amount of tax to take out.
How is withholding tax paid to the state?
You’ll need to pay withholding tax monthly or quarterly, depending on how much you owe. The Mississippi Department of Revenue will notify you of your filing frequency.
Mississippi encourages employers to pay their withholding tax electronically. However, if you owe $20,000 or more, it’s required.
Annual summary reports are required from all employers. You’ll need to use Form 89-140, Mississippi Annual Information Return and include copies of your federal Form W-2, Wage and Tax Statement, and any 1099s that have Mississippi income tax withheld.
How is Mississippi’s unemployment tax calculated?
New employers start with a 1% tax rate in the first year that they have employees. The rate goes up each year until you qualify for a modified rate.
Your modified rate is based on your use of the unemployment compensation program, and rates range from 0.2% to 5.4%.
| Mississippi Unemployment Tax Rates (New Employers) | |
| Tax Rate | Year of Business |
| 1.0% | First year |
| 1.1% | Second year |
| 1.2% | Third year |
But you’ll only pay tax on the first $14,000 of each employee’s wages each year.
Tax payments and wage reports are due each quarter. You can pay your tax online or via paper check. Wage reports are due for all quarters, even when you paid no wages or have no tax due.
What is Mississippi’s salary threshold?
Because the state of Mississippi doesn’t have its own salary threshold, it adheres to the federal salary threshold, which is now $684 per week (equivalent to $35,568 per year for a full-year worker). The Department of Labor permits employers to count some bonuses, commissions, and other incentive payments toward meeting the standard salary level (up to 10%). Employees who earn at least $107,432 per year may qualify as “highly compensated.” See this Department of Labor fact sheet for details.
When do final paychecks need to be provided to employees?
There is no law on when final paychecks should be given. But it makes sense to provide them no later than the next regularly scheduled payday.
When is Workers’ Compensation insurance required in Mississippi?
Requirements to obtain Workers’ Compensation vary by state, this table outlines some of these requirements.
If you determine that your company is required to purchase Workers’ Compensation insurance in your state, learn how to sign up for this insurance with Gusto.
Sometimes, companies get a request for a workers’ comp audit—head to this article and click the workers’ comp audit reports dropdown for more information.
Do new hires need to be reported in Mississippi?
Within the first 15 days of employment, employers need to report newly hired or rehired employees to the state directory.
Federal payroll taxes in Mississippi
How is federal withholding tax calculated?
You need to have employees fill out Form W-4, Employee’s Withholding Certificate, when they begin working for you. This form will help you determine the amount of tax to take out of their paychecks.
With information like tax filing status and the number of dependents you’ll get from Form W-4, you’ll use the federal withholding tables to calculate the withholding amount.
How is the FICA tax calculated?
The Federal Insurance Contributions Act, or FICA tax, is made up of the Medicare tax and the Social Security tax. In 2022, the Social Security tax requires employers and employees to each contribute 6.2% of wages up to $147,000. The Medicare tax requires each to contribute 1.45% of all wages. See the IRS webpage for details, like maximum thresholds.
| FICA Tax | |
| Social Security tax | 6.2% on the employee’s first $147,000 in 2022 |
| Medicare tax | 1.45% on all wages |
| Total tax | 7.65% |
Who pays federal unemployment tax, and how’s it calculated?
Like the state, the federal government also has an unemployment tax. It’s called FUTA and it’s an annual tax employers pay on the first $7,000 of each employee’s wages. The FUTA rate for 2022 is 6%, but most employers only have to pay 0.6% each year.
What’s the Additional Medicare tax?
Some employees may need to pay the Additional Medicare tax. It’s based on their tax filing status and taxable income.
You’ll need to withhold this tax from any employee earning more than $200,000 per year. The tax rate is 0.9% on wages over $200,000 each year.
How are federal payroll taxes paid?
How often you pay your federal payroll taxes depends on how much tax you owe.
| Federal Payroll Tax Payment Frequency | |
| Tax Type | Payment Frequency |
| FICA | Monthly, semi-weekly, or next day |
| Federal withholding tax | Monthly, semi-weekly, or next day |
| Additional Medicare tax | Monthly, semi-weekly, or next day |
| Federal unemployment tax | Annually or quarterly |
You’ll need to file payroll tax returns also.
- Form 941, Employer’s Quarterly Federal Tax Return
- Used for:
- FICA
- Federal withholding tax
- Additional Medicare tax
- Used for:
- Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return
- Used for:
- Federal unemployment tax
- Used for:
Remember to pay and file your payroll tax returns on time. Penalties can be assessed for delinquencies. Using a payroll provider eliminates the risk of missing deadlines. They file and pay your taxes for you, so you don’t have to worry about it.
Disclaimer
The information provided by the Employer Tax Calculator is for general information and estimation. All of the taxes or fees that apply to your business may not be accounted for, or fully up to date. Gusto, Inc. (dba “Gusto”) does not promise or guarantee that the information in the Employer Tax Calculator is accurate or complete, and Gusto expressly disclaims all liability, loss or risk incurred by employers or employees as a direct result or an indirect consequence of its use. By using the Employer Tax Calculator, you waive any rights or claims you may have against Gusto in connection with its use.