The rules where you work $17
A first 30 days checklist, everyday forms, licenses, workers’ comp and taxes for Mississippi, with a yearly calendar. Instant PDF download.
Buy the packet: $17Digital product, all sales final. Informational only, not legal, financial, tax or business advice.
What Mississippi expects from a new trade business
Mississippi lets you start small: most home jobs need no state license until they pass a dollar line, and comp isn't required until you regularly employ five people. Sales tax is the odd one, because whether you collect or pay it depends on your trade and the job. Liens run on a 90-day filing clock and a 180-day suit clock.
Dollar lines for most work, none for some trades
The Mississippi State Board of Contractors licenses by job size. New home construction over $50,000 needs a Residential Builder license. Remodeling or roofing a house over $10,000 needs a Remodeler or Roofer license. Commercial work at $50,000 needs a commercial license. Fire protection work has lower lines: $5,000 on public jobs, $10,000 on private.
Here's the catch: electrical, plumbing, mechanical and HVAC subs on a home job need a state license no matter the dollar amount. Construction managers and residential solar contractors need one too. On a commercial job, ask the Board whether your line goes by your subcontract or the whole job. The statute and the Board's FAQ read differently. All applicants take a law and business exam.
Work over the line unlicensed on a home job and you can't sue on the contract. You recover only documented expenses, no profit. You also have no lien, and neither does anyone who hires an unlicensed contractor or sub. There are criminal penalties too. A construction attorney can read your job scope against these limits.
Source: MSBOC: Frequently Asked Questions · MSBOC: HB 1163 residential licensing law changes · MSBOC: Residential Builders Law and Rules (2022) · MSBOC: Commercial Laws and Rules (2022) · Miss. Code 85-7-403 (2025)
Who to call: an attorney near you
Five regular employees is the line
The Workers' Compensation Commission says employers with five employees regularly employed must carry comp. Below five, it's voluntary. A claims guide posted by the Commission treats it as a size-of-operation test, so a crew that regularly runs five can count even if all five aren't working at the same time. The sources show no lower number for construction.
The sub trap is real, though. If a roofer you hired has no coverage and one of the roofer's workers gets hurt, that worker can have a claim against you as a statutory employee. Get a certificate before they start. Calling someone an independent contractor doesn't settle it either: the guide looks at who controls the work and whether it's an integral part of your business.
The Board of Contractors also wants proof of comp from license applicants with 5 or more employees. Before you hire, ask an insurance agent who writes contractors how your own role as an owner gets treated on a policy.
Source: Mississippi Workers' Compensation Commission: WC Facts · Mississippi Workers' Compensation Claims Guide (2016, posted by the Commission) · Mississippi Workers' Compensation Claims Guide (2019, posted by the Insurance Department) · MSBOC: Apply for a License
Who to call: an insurance agent near you
Getting paid: 90 days to file, 180 to sue
Mississippi's lien law is the same 90-and-180 clock on every job. The notices before it depend on who hired you:
- File the claim with the chancery clerk where the property sits within 90 days of your last work or materials. It has to include the expiration statement and the owner's right to contest, or the lien is invalid.
- Send a copy by certified or registered mail or statutory overnight delivery within 2 business days of filing.
- Start a payment action within 180 days of filing, with a lis pendens, or the lien is unenforceable. A recorded notice of contest can cut that to 90 days.
- Other than single-family, with no contract with the contractor? Give written notice within 30 days of first delivering labor, services or materials, or forfeit the lien.
- Single-family homes: anyone without a contract with the owner has to give the owner a pre-lien notice at least 10 days before filing. Payments the owner made to the contractor before getting that notice can defeat your claim.
Unlicensed where a license is required? No lien. A construction attorney can set up your notices once.
Source: Miss. Code 85-7-405 (2025): filing, copy, suit · Miss. Code 85-7-407 (2025): 30-day notice · Miss. Code 85-7-409 (2025): single-family pre-lien notice · Miss. Code 85-7-421 (2025): expiration · Miss. Code 85-7-423 (2025): notice of contest · Miss. Code 85-7-403 (2025): who has a lien, license condition
Who to call: an attorney near you
Your trade decides who pays what
Mississippi splits construction in a way most states don't.
- Home jobs and prime contracts of $10,000 or less: no contractor's tax. A carpenter, painter, drywall or masonry contractor pays 7% on materials at purchase and charges no sales tax on the job.
- Plumbing, heating, AC, electrical, excavating, landscaping, sheet metal, insulating on those same jobs: taxable services. You charge 7% on gross income and buy component materials tax-free.
- Dealers doing installed sales of roofing, tile, carpet, fences and the like: 7% on gross income.
- Non-residential prime contracts over $10,000: a 3.5% contractor's tax on the contract price. Apartments and condos count here. A Material Purchase Certificate then lets you buy component materials tax-free. Over $75,000, you pay the tax before work begins or file a surety bond. Without a physical location in Mississippi, that line is $10,000.
Sub rules vary by who your prime is. A CPA who works with contractors can map your trade to the Revenue Department's chart.
Source: Mississippi DOR: Guide for Construction Contractors
Who to call: a CPA or tax pro near you
A $50 LLC and a free annual report
Forming an LLC with the Mississippi Secretary of State costs $50, and online filings usually take 1 to 3 business days. The annual report costs $0 and is due between January 1 and April 15. It's free, not optional: skip it and the state can dissolve the company. No franchise tax on LLCs and no publication requirement.
Decide this before you get a license. The Board of Contractors wants an LLC to show good standing with the Secretary of State, and going from sole proprietor to LLC later takes a new license application.
Pass-through profit lands on your personal return. Mississippi taxes the first $10,000 of taxable income at 0%, and the rest at 4% for 2026, dropping to 3.75% for 2027.
An S-corp election is a numbers question. Take what the business clears to a CPA who works with contractors.
Source: Mississippi DOR: Individual income tax rates · MSBOC: Apply for a License · MSBOC: Frequently Asked Questions
Who to call: a CPA or tax pro near you
Education, not legal or tax advice. Rules change. Confirm anything here with a licensed pro in Mississippi before you rely on it. Last updated November 2026.