Income tax credit; revise for employers providing dependent child care or child care stipends.

Employer tax credit for dependent care

Beginning July 1, 2026, Mississippi gives employers a 50% income tax credit for dependent care, up to $3,000 per child each year. The credit covers net contract costs with licensed providers, direct care staff, materials, facilities, or child care stipends. Stipends must be at least $2,000 per child and paid to a licensed in-state provider. Only licensed or certified programs qualify, including child care centers, approved family homes, teen programs, elder care, and disability care. The Health Department certifies care for kids 12 and under and elderly adults; the Revenue Department certifies programs serving older dependents. Unused credit can be carried forward up to five years and is not refundable. You cannot also deduct the same expenses or transfer the credit. The state caps total credits at $1 million per year; once reached, no more credits are available that year.