Senate approves voluntary donor tax credit for small rural hospitals, with $100,000 per-hospital cap

The Mississippi Senate adopted and passed a measure creating a voluntary tax-credit incentive for individuals who donate cash to eligible rural hospitals.

Senator Taylor, explaining the committee substitute for SB 31-10, said donors may choose either an income tax credit or an ad valorem property tax credit capped at 50% of liability. Taylor emphasized program limits: a maximum of $100,000 per hospital per year and a statewide cap of $1,000,000. "This program is very responsible because it limits us to a 100,000 per hospital and, no more than 1,000,000 statewide per year," Taylor said.

Several senators pushed back with technical and fiscal questions. Senator Bryant argued the ad valorem credit mechanism can shift local tax credit burdens to the state general fund via reimbursement processes and called the scheme a convoluted workaround that has appeared in past bills. Sponsors acknowledged this concern and said the bill includes a reverse repealer and that they will work to ensure counties are made whole, with application and reimbursement mechanics to be finalized.

What happens next: The committee substitute was adopted and the bill passed by morning roll call. Sponsors said they will continue work on the application and reimbursement process to address county concerns before the program is implemented.

Quote: "It's limited to a 100,000 per hospital and, no more than 1,000,000 statewide per year," Senator Taylor said while describing the bill.

The measure includes program safeguards in the floor text but supporters acknowledged additional drafting is needed to finalize local reimbursement mechanics.