Home Tax Professionals Legislative Summaries State Legislative Summaries 2023 Legislation House Bill 002 - Income Tax - Subtraction Modification - Union Dues House Bill 002 - Income Tax - Subtraction Modification - Union Dues This bill allows a subtraction modification against the Maryland income tax for union dues paid by an individual during the taxable year. This subtraction was allowed as an itemized deduction at the federal level before January 1, 2018. House Bill 0086 / Senate Bill 0189 – Disclosure of Tax Information - Maryland Small Business Retirement Savings Board – Authorization House Bill 0086 / Senate Bill 0189 – Disclosure of Tax Information - Maryland Small Business Retirement Savings Board – Authorization This bill adds the Small Business Retirement Savings Board and its contractors to the list of officials with the right to view tax information for the purpose of administering the Maryland Small Business Retirement Savings Program and Trust. The disclosure of tax information is limited to a business entity's FEIN, name, physical address, mailing address, and contact information. The disclosure will not include tax information of individuals and may only be used for the specific purpose authorized by the Comptroller. House Bill 0179 / SB 0055 - Maryland Estate Tax - Portability - Time Period for Election House Bill 0179 / SB 0055 - Maryland Estate Tax - Portability - Time Period for Election This bill alters the time within which a person may file an estate tax return solely for the purpose of allowing the surviving spouse to take into account the deceased spousal unused exclusion (“DSUE”) amount. The time period will conform to the IRS’s policy, which currently allows a DSUE election to be made within 5 years of the predeceased spouse’s death. The bill applies retroactively to decedents dying on or after January 1, 2019. House Bill 0180 / Senate Bill 0141 - Income Tax - Subtraction Modification for Adoption Expenses - Alterations House Bill 0180 / Senate Bill 0141 - Income Tax - Subtraction Modification for Adoption Expenses - Alterations This bill removes the differentiation between a child who is a resident of Maryland vs nonresident. Additionally, the bill increases the subtraction limit to $12,000 for adoption of a child with special needs and to $10,000 for adoption of a child without special needs. House Bill 0192 / Senate Bill 0269 – Currency – Campaign Finance Prohibitions – Disclosures by Financial Institutions House Bill 0192 / Senate Bill 0269 – Currency – Campaign Finance Prohibitions – Disclosures by Financial Institutions This bill allows the Comptroller to request information and assistance from cryptocurrency financial institutions/transmitters when enforcing state tax laws/liens and allows the Comptroller to direct those transmitters to transfer property to the Comptroller if the account holder is subject to a tax lien. Senate House Bill 0237 / Senate Bill 0174 - Sales and Use Tax Exemption - Redevelopment Areas in Baltimore County - Sunset Extension Senate House Bill 0237 / Senate Bill 0174 - Sales and Use Tax Exemption - Redevelopment Areas in Baltimore County - Sunset Extension This bill extends the sunset provision for the sales and use tax exemption for construction and warehousing materials used in certain redevelopment areas in Baltimore County from 2026 to 2036. Senate Bill 0240 - Income Tax - Out-of-State Taxes Paid by Pass-Through Entities - Addition Modification Senate Bill 0240 - Income Tax - Out-of-State Taxes Paid by Pass-Through Entities - Addition Modification This bill requires an addback of any credit for taxes paid to another state when those taxes are based on a credit received from a pass-through entity that paid taxes based on income in the other state. Senate Bill 0241 - Commercial Law - Abandoned Property - Alterations Senate Bill 0241 - Commercial Law - Abandoned Property - Alterations This bill requires the Comptroller, as Administrator of abandoned property in the State, to determine the value of nonmonetary abandoned property. If the Comptroller determines the property has no commercial value and need not be offered for sale, the Comptroller may return the property to the holder, destroy the property, or dispose of the property. Senate Bill 0242 - Income Tax - Work Opportunity Tax Credit - Technical Correction Senate Bill 0242 - Income Tax - Work Opportunity Tax Credit - Technical Correction This bill makes a technical correction citing to the correct location where “federal work opportunity credit” is defined in the Internal Revenue Code. Senate Bill 0243 - Income Tax - Child and Dependent Care Tax Credit - Alterations Senate Bill 0243 - Income Tax - Child and Dependent Care Tax Credit - Alterations This bill clarifies that the child and dependent care tax credit is available to residents only. House Bill 0316 / Senate Bill 0354 - Income Tax Checkoff - Maryland Veterans Trust Fund House Bill 0316 / Senate Bill 0354 - Income Tax Checkoff - Maryland Veterans Trust Fund This bill establishes the Maryland Veterans Trust Fund (MVTF) checkoff on the individual income tax return form beginning in tax year 2025. The individual, or each spouse in the case of a joint return, may contribute to the fund an amount designated by the individual. The individual deducts the amount of the contribution from any refund to which the individual is entitled or, if the individual is not entitled to a refund, the individual adds the amount of the contribution to the income tax paid with the return. House Bill 0333 / Senate Bill 0404 - Hospitals - Financial Assistance - Medical Bill Reimbursement Process House Bill 0333 / Senate Bill 0404 - Hospitals - Financial Assistance - Medical Bill Reimbursement Process Health General § 19-214.4 requires hospitals to provide refunds to patients who paid for hospital services received in any year between 2017 and 2021 and were eligible, at the time of service, for free care from the hospital under Health General §19-214.1. This bill creates a program to further the goal of providing refunds to qualified patients who paid out-of-pocket by requiring hospitals to share certain information with the Comptroller. Senate Bill 0452 - Film Production Activity Income Tax Credit - Alterations and Maryland Entertainment Council Senate Senate Bill 0452 - Film Production Activity Income Tax Credit - Alterations and Maryland Entertainment Council This bill alters the film production activity tax credit by: expanding eligible film production activities; expanding eligible costs; increasing the amount of eligible costs that qualify; and increasing the maximum amount of credits the Department of Commerce may award each year (from $12.0 million) to $15.0 million for fiscal year 2024, §17.5 million for fiscal year 2025, and $20.0 million for fiscal year 2026. This bill also establishes the Maryland Entertainment Council to assess Maryland's existing assets, opportunities, and competitive position with the film, television, and entertainment industry, study specified related topics, and make related recommendations. House Bill 0471 / Senate Bill 0333 – Economic Development – Regional Institution Strategic Enterprise Zone Program – Alterations and Financing Souse Bill 0471 / Senate Bill 0333 – Economic Development – Regional Institution Strategic Enterprise Zone Program – Alterations and Financing This bill extends the termination date of the Regional Institution Strategic Enterprise (RISE) Zone Program and extends the duration of a RISE zone designation from 5 to 10 years. The bill alters a related definition pertaining to the Maryland Economic Development Corporation (MEDCO) by explicitly including RISE zones. Development enterprises in RISE Zones may be eligible for income tax credits under TG § 10-702. House Bill 0547 / Senate Bill 0552 - Family Prosperity Act of 2023 House Bill 0547 / Senate Bill 0552 - Family Prosperity Act of 2023 This bill permanently extends the temporary 2021 expansion of the refundable Maryland earned income credit (EIC) to 45% of the federal EIC. It also eliminates the existing limit of the refundable EIC for individuals without qualifying children so that they can claim 100% of the federal EIC as a refundable state income tax credit. It also permanently allows individuals with ITINs to claim the EIC. The bill also increases the maximum federal adjusted gross income a taxpayer may have to claim the child tax credit to $15,000 from $6,000, which will increase the number of taxpayers who may claim the credit. The bill clarifies an individual must be a Maryland resident to claim the child tax credit. House Bill 0554 / Senate Bill 0553 - Income Tax - Subtraction Modification for Military Retirement Income (Keep Our Heroes Home Act) House Bill 0554 / Senate Bill 0553 - Income Tax - Subtraction Modification for Military Retirement Income (Keep Our Heroes Home Act) This bill increases the subtraction for military retirement income beginning tax year 2023. For individuals under age 55, the maximum subtraction will be $12,500. For individuals age 55 or older, the maximum subtraction will be $20,000. House Bill 0556 / Senate Bill 0516 - Cannabis Reform House Bill 0556 / Senate Bill 0516 - Cannabis Reform This emergency bill: renames the Alcohol and Tobacco Commission as the Alcohol, Tobacco, and Cannabis Commission (ATCC) and assigns it cannabis-related duties; establishes the Maryland Cannabis Administration (MCA) as an independent unit of State government to oversee the regulation of adult-use cannabis and designates the MCA as the successor of the Maryland Medical Cannabis Commission (MMCC); creates a licensing framework for the regulated sale of cannabis in the State; imposes a 9% sales and use tax on the sale of adult-use cannabis; and establishes the Office of Social Equity (OSE) and the Social Equity Partnership Grant Program in ATCC. House Bill 0584 - Income Tax Credit - Food Donations by Qualified Farms - Sunset Repeal and Alterations (Farmers Feeding Families Act) House Bill 0584 - Income Tax Credit - Food Donations by Qualified Farms - Sunset Repeal and Alterations (Farmers Feeding Families Act) This bill repeals the sunset provision and increases the credit amount for food donations beginning tax year 2023. The credit amount will be 100% of the value of donated fresh farm products (increased from 50%) and 100% of the value of donated certified organic produce (increased from 75%). House Bill 0680 - Income Tax - Student Loan Debt Relief Tax Credit - Alterations House Bill 0680 - Income Tax - Student Loan Debt Relief Tax Credit - Alterations This bill increases total amount of credit available from $9,000,000 to $18,000,000 and increases the time period allowed to use the credit for repayment of student loans from 2 to 3 years. If the credit is not used within 3 years of the close of the taxable year for which the credit is claimed, the credit must be recaptured as taxes payable for the tax year in which the event requiring recapture of the credit occurs. House Bill 0687 / Senate Bill 0446 - Estates and Trusts - Trusts - Decanting (Maryland Trust Decanting Act) House Bill 0687 / Senate Bill 0446 - Estates and Trusts - Trusts - Decanting (Maryland Trust Decanting Act) This bill establishes rules allowing an authorized fiduciary to distribute property from a first trust to a second trust or to modify the terms of the initial trust. This does not apply to charitable trusts. The fiduciary may not distribute property to the second trust in a manner that does not preserve specified federal or state tax benefits that existed with the first trust. Specifically, the bill prohibits a fiduciary from transferring property to the second trust in a manner that the property would no longer benefit from the marital tax deduction, charitable deduction, exclusion from the gift tax, or the generation-skipping transfer tax. Senate Bill 0691 - Home Amenity Rentals - Sales and Use Tax Imposed and Local Tax Authorized Senate Bill 0691 - Home Amenity Rentals - Sales and Use Tax Imposed and Local Tax Authorized The purpose of the bill is to tax home amenity rentals. Home amenities are any portion of a residential property, excluding sleeping quarters, that is occupied by the hour for not more than 15 consecutive hours. Tangible personal property will include a home amenity rental beginning July 1, 2024. Home amenity rentals will be subject to sales and use tax. The taxable price is the full amount of consideration paid by a buyer, not including any tax. Taxable price does not include the commission paid to the intermediary or platform. The intermediary or platform is a vendor. The bill also authorizes counties and municipalities to impose a home amenity rental tax. The localities must administer the tax. House Bill 0707 / Senate Bill 0660 - Office of the Comptroller - Taxpayer Advocacy Division House Bill 0707 / Senate Bill 0660 - Office of the Comptroller - Taxpayer Advocacy Division This bill establishes the Taxpayer Advocate Division within the Comptroller’s Office to assist taxpayers and tax representatives in resolving problems and responding to complaints. The position of Taxpayer Advocate will be appointed by the Comptroller. Senate Bill 0721 - Income Tax - Credit for Federal Security Clearance Costs - Alterations Senate Bill 0721 - Income Tax - Credit for Federal Security Clearance Costs - Alterations This bill reauthorizes the employer security clearance costs tax credit. The Employer Security Clearance Costs Tax Credit program was established in 2012. The program allows a tax credit against the State income tax for certain security clearance administrative expenses and for the construction and equipment costs to construct or renovate a sensitive compartmented information facility (SCIF) located in the State. The program originally applied to tax years 2013 through 2016 and was extended through tax year 2021. This tax credit cannot be taken in tax year 2022. Senate Bill 0783 - Preservation and Reuse of Historic Complexes Study and Alterations to the Income Tax Credit for Catalytic Revitalization Projects Senate Bill 0783 - Preservation and Reuse of Historic Complexes Study and Alterations to the Income Tax Credit for Catalytic Revitalization Projects An individual, nonprofit, or business may claim a tax credit of 20% of the amount stated in the final credit certificate issued by DHCD for 5 consecutive years beginning with the taxable year in which a final tax credit certificate is issued. Prior to this bill, the first year the credit could be claimed was the year the project was completed. This bill also requires the Smart Growth Subcabinet to study and make recommendations for a plan to preserve and reuse historic State complexes. Senate Bill 0792 - Estates and Trusts - Registered Domestic Partnerships Senate Bill 0792 - Estates and Trusts - Registered Domestic Partnerships This bill creates a process by which domestic partnerships may be registered and terminated through the Register of Wills. The bill repeals references to legitimacy/illegitimacy of children and defines the parentage of children born or conceived by registered domestic partners. Additionally, the bill expands the definition of “Domestic Partnership” found in Tax-General 7-203(l) and provides that, for domestic partners registered with the Register of Wills, any property that passes from the decedent to or for the use of the domestic partner of the decedent is excluded from the inheritance tax. Senate Bill 0968 - Income Tax - Captive Real Estate Investment Trusts - Alterations Senate Bill 0968 – Income Tax – Captive Real Estate Investment Trusts – Alterations This bill alters the types of REITs that must add back dividends. House Bill 1074 / Senate Bill 0624 - Income Tax - Automated External Defibrillator Tax Credit (Joe Sheya Act) House Bill 1074 / Senate Bill 0624 - Income Tax - Automated External Defibrillator Tax Credit (Joe Sheya Act) This bill allows an individual or business entity that owns a restaurant to claim a nonrefundable income tax credit in an amount equal to the first $500 of the purchase price of an FDA-approved automated external defibrillator purchased during the taxable year. The credit is applicable for only one defibrillator for use at a restaurant location with annual gross income of at least $400,000, and may be claimed only once for each restaurant. The maximum credit allowed each year is $1,500, and the credit must be calculated after applying all other credits (except credits for taxes withheld, estimated tax payments, and taxes paid by pass-through entities). Prior Year Legislation Use the following link to search for prior year legislation on the Maryland General Assembly's Website.