Federal franchise laws apply. A Franchise Disclosure Document (FDD) is required and must be kept current. The FDD must be provided 14 days or earlier before selling a franchise location.
It’s important to comply with both federal and state laws before marketing, offering or selling a franchise. This includes having an updated FDD. Both registration and non-registration states have specific requirements that are crucial for first-timers.
Onboarding a franchise lawyer is recommended as they are knowledgeable about state and federal requirements. In Mississippi, registering with the Secretary of State or Department of Revenue may be necessary for tax purposes, although a statewide basic business license is not required.
Today, agriculture and forestry are Mississippi’s top industries. While there are no Fortune 500 companies, the state is known for its great business community, offering incentives such as tax breaks and low business costs.
Applying for a sales tax permit is free, but be aware that other registration fees may apply. Contact the department of revenue for business registration requirements.
Mississippi imposes a franchise tax rate of $25 for the first $100,000 of net worth and $1 for each additional $1,000 of net worth. Additionally, the unemployment tax, which funds the unemployment insurance program, is 2.7% of the first $7,000 of wages per employee. Similarly, workers’ compensation tax supports its respective program.
Before starting your business, ensure that you obtain the necessary license. Check the Secretary of State’s website to search for currently licensed businesses by inputting the business name, type, and location.
Mississippi’s checklist for establishing a business includes staying informed about tax code changes and registering for various taxes such as income withholding, sales tax, unemployment insurance, and possibly franchise tax. It is also advised to open a separate business bank account for liability protection and accounting simplicity. An Employer Identification Number (EIN) is typically required.