35 Miss. Code R. § 3-08-08-101
Section 27-7-17 provides that an interest expense deduction will be denied or limited in the case of a parent that makes a loan to a subsidiary which is not business related. Subsidiaries that are undercapitalized and borrow money from a parent corporation or other corporation of an affiliated group may not deduct any interest on these loans. Corporations that borrow funds from affiliated corporations for working capital and have been paying dividends instead of retaining an amount of funds sufficient to maintain operations will be allowed to deduct interest only on an amount equivalent to the borrowed funds less dividends paid. Amounts of interest on borrowed funds used to pay dividends will not be allowed as a deductible expense of the corporation.
35 Miss. Code. R. § 3-08-08-101