Mississippi Legal Guide Debt Business and Estate Planning

This guide reflects Mississippi law on debt, business set-up and estate planning as of September 2024. This guide is designed to give individuals and businesses an overview of the law on these topics.

The guide covers debt management, bankruptcy, business incorporation and estate planning. It explains how to handle these matters step by step.

Consolidation & Debt Settlement in Mississippi

• Debt consolidation: It combines multiple debts into one loan, often with a lower interest rate. This can make payments more manageable.
• Debt settlement: Negotiation with creditors will lead to reduced debt, usually through a single payment.

Mississippi does have laws in place that protect consumers against scams run by debt relief companies. This is prudent to determine if a company is accredited through an independent organization such as the Better Business Bureau before retaining its services.

Additional Resources

Looking for more information? Click here for more details:

• How to Consolidate Debts in Mississippi
• How to Settle Credit Card Debts in Mississippi

Statute of Limitations on Debt in Mississippi

Mississippi puts a limit on how long a creditor has to sue you for an unpaid debt. The time limits, known as statutes of limitations, differ depending on the type of debt:

If you have unpaid medical bills or credit card balances, creditors can sue you within 3 years.

For car loans, this time period is longer; creditors have 6 years in which to take legal action.

If one owes state taxes, then the state has 7 years to bring suit.

Once these periods lapse, the creditor will no longer be able to sue you in court. That does not mean, however, that the debt just disappears: they can still try calling or writing letters for collection. Watch out for old debts. If you make a payment or in writing, admit to owing the debt, you may inadvertently start the time limit running again. That will give the creditor extra time to sue you.

Mississippi Debt Collection Laws

Mississippi follows federal legislation when it comes to protecting consumers from unfair debt collection practices. Here is what's vital:

• Garnishment: Creditors have the right, after receiving a court judgment, to garnish up to 25% of their disposable income.
• Call recording: Mississippi is a one-party consent state, which means creditors are allowed to record calls without informing you.
• Collections methods: Failure to appear in court when sued by a creditor may result in a judgment against the debtor. The creditor may then seek wage garnishment, bank account interceptions, or liens on property.

More Consumer Law Resources

Mississippi Consumer Protection Act

Mississippi Foreclosure Laws

Mississippi Repossession Laws

Mississippi Small Claims Court Guide

Bankruptcy Laws in Mississippi

If you're struggling with debt in Mississippi, bankruptcy might help. Mississippi follows federal bankruptcy laws. These laws give you a way to deal with debts you can't pay.

There are, in general, three types of bankruptcy:

• Chapter 7: Sometimes this is referred to as "liquidation." The court sells some of your stuff to pay your debts. After that, most of the rest of your debts are wiped out. You get to start fresh.
• Chapter 13: Under this, a person receiving regular income can file for bankruptcy. During the process, one may retain the property; however you need to pay the debt in 3 to 5 years. The court assists in proposing a payment plan.
• Chapter 11: This is employed primarily by businesses that restructure their debts and continue running their businesses.

Mississippi law allows you to exempt some things if you file bankruptcy:

Your residence: You are able to exempt up to $75,000 of your home's value.

Your car: You can retain one car valued at as much as $10,000.

Wages: You may exempt up to 75% of your weekly pay.

Bankruptcy filings in Mississippi are made to a special federal court. You will have to disclose all of your financial information, which includes income and the amount owed. Notice of bankruptcy filing has also to be given to all of your creditors.

Learn more about Mississippi Bankruptcy Laws

Starting a Business in Mississippi

Setting up a business in Mississippi is pretty straightforward. Here's what you need to do:

1. Pick a Name: Choose a unique name for your business. Make sure it follows state rules.
2. Make It Official: File some papers (called Articles of Incorporation) with the Mississippi Secretary of State. This makes your business legal.
3. Choose a Contact Person: Pick someone to receive legal papers for your business. This person is called a registered agent.
4. Set Your Rules: Write down how you will run your business. These are called bylaws.
5. Get Licenses: Mississippi doesn't require a general business license but some businesses need special permits. For example, if you are selling food or alcohol, you will need extra paperwork. Also, check with your city or county - they might have their own rules.
6. Keep the State Updated: Every year, you will need to file a report to keep your business in good standing.

The cost to set up your business depends on what type it is. For example, a business that makes money (for-profit) pays different fees than one that doesn't (non-profit).

If you ever need to close your business, Mississippi has a process for that, too. You will need to sell off what you own, pay your debts and file some final papers.

Planning Your Estate in Mississippi

Estate planning is about deciding what happens to your things after you die. In Mississippi, there are two main ways to do this:

A Will is a document that says who gets your stuff when you die. In Mississippi, to make a will legal, you must sign it and have two other people watch you sign it and then sign it themselves. It's important to note that handwritten wills usually don't count in Mississippi - your will should be typed.

A living trust is another option. With a living trust, you can use and control your stuff while you are alive. After you die, your things go directly to the people you choose. It's more private than a will and might help avoid some taxes. But anything not in the trust still has to go through court.

Good estate planning is important. It helps make sure your wishes are followed, avoids family arguments and can save time and money in legal processes.

If you need help, you can contact the

• Mississippi Bar Association
• The U.S. Bankruptcy Court for Mississippi
• The Mississippi Secretary of State.

These places can give you general information but for specific advice about your situation, it's best to talk to a lawyer who knows Mississippi law well.