How Much Tax Is Deducted From a Paycheck in Mississippi?

Understanding paycheck deductions is important for managing personal finances. When an employer issues a paycheck, the amount received, known as net pay, is often less than the gross wages earned. This difference reflects mandatory and voluntary withholdings. These deductions contribute to various programs and benefits, from government services to employee-specific benefits.

Federal Taxes Withheld

A significant portion of paycheck deductions comes from mandatory federal taxes. These taxes fund various government programs and services. The primary federal withholdings include federal income tax and Federal Insurance Contributions Act (FICA) taxes.

Federal income tax withholding is based on information provided by an employee on Form W-4, Employee’s Withholding Certificate. This form guides employers on how much federal income tax to deduct from each paycheck. Factors such as filing status, the number of dependents claimed, and any additional income or deductions influence the amount withheld.

FICA taxes are dedicated to funding Social Security and Medicare. For Social Security, employees generally contribute 6.2% of their gross wages, up to an annual wage base limit. For 2024, this limit is $168,600, meaning any earnings above this amount are not subject to Social Security tax. Medicare tax is assessed at a rate of 1.45% on all gross wages, with no wage base limit. An additional Medicare tax of 0.9% applies to wages exceeding certain thresholds ($200,000 for single filers, $250,000 for married filing jointly), increasing the total Medicare tax rate for high earners to 2.35%.

Mississippi Taxes Withheld

Employees in Mississippi also see deductions for state-level taxes. The primary state withholding in Mississippi is for state income tax. Mississippi employs a progressive income tax system, though for the 2024 tax year, the structure simplifies to a two-tier approach.

The first $10,000 of taxable income is not taxed. Any taxable income exceeding $10,000 is subject to a tax rate of 4.7%. This rate is part of a planned reduction, with the top rate scheduled to decrease further to 4.4% for the 2025 tax year and 4% for 2026. When calculating the amount subject to state income tax, Mississippi allows for standard deductions and personal exemptions.

For 2024, the standard deduction amounts are $2,300 for single filers and married individuals filing separately, $3,400 for head of family, and $4,600 for married individuals filing jointly. Personal exemptions further reduce taxable income. A single individual can claim a $6,000 exemption, while married couples filing jointly are allowed a $12,000 exemption. Head of family filers receive an $8,000 exemption. An additional exemption of $1,500 is available for each dependent, or for the taxpayer or spouse if they are age 65 or older or blind.

Mississippi does not impose other employee-paid payroll taxes, such as state disability insurance or state unemployment insurance contributions. While employers in Mississippi are required to contribute to the state’s unemployment insurance fund, employees are not. Paycheck deductions in Mississippi are generally limited to federal taxes, state income tax, and any voluntary deductions.

Other Paycheck Deductions

Beyond mandatory federal and state income taxes, paychecks may include various other deductions. These can be categorized as either pre-tax or post-tax, impacting an employee’s taxable income differently. The distinction between these types of deductions influences the amount of gross pay subject to federal and state income taxes.

Pre-tax deductions are subtracted from an employee’s gross pay before taxes are calculated, thereby reducing the amount of income subject to taxation. Common examples include contributions to employer-sponsored retirement plans, such as a 401(k) or 403(b), and premiums for health, dental, or vision insurance plans. Contributions to Flexible Spending Accounts (FSAs) for healthcare or dependent care, and Health Savings Accounts (HSAs) also fall into this category.

Post-tax deductions are taken out of an employee’s pay after all applicable taxes have been calculated and withheld. These deductions do not reduce taxable income. Examples of post-tax deductions include contributions to a Roth 401(k), union dues, repayments for 401(k) loans, wage garnishments for debts or child support, and charitable contributions made directly through payroll.

Interpreting Your Paystub and Adjusting Future Withholding

Understanding a paystub is essential for verifying income, deductions, and contributions. A typical paystub will clearly display gross pay (total earnings before any deductions) and net pay (the amount deposited into an account). It will also itemize all deductions, with specific codes, allowing for a clear breakdown of federal income tax, FICA taxes, state income tax, and any other pre-tax or post-tax withholdings. Many paystubs also show year-to-date totals for earnings and deductions.

Employees can adjust their federal and Mississippi state income tax withholding to better align with their financial situation. For federal income tax, adjustments are made by submitting a new Form W-4, Employee’s Withholding Certificate, to the employer. This form allows individuals to update their filing status, claim dependents, or specify additional amounts to be withheld, impacting future paychecks. Reviewing and updating the W-4 periodically helps prevent over- or under-withholding throughout the year.

Mississippi state income tax withholding can be adjusted using the Mississippi Employee’s Withholding Exemption Certificate, Form 89-350. Employees can obtain this form from their employer or the Mississippi Department of Revenue. Completing and submitting a revised Form 89-350 to the employer allows for changes to personal exemptions based on marital status, dependents, or other qualifying factors, modifying the amount of state income tax withheld from subsequent paychecks.