SC&H Group Blog: "Expertise Beyond the Numbers"

Recent Tax Updates from the State of Maryland [Blog Post]

SC&H Group’s Tax Services team offers the following blog post about the most recent tax updates in the state of Maryland, which will benefit both businesses and individuals.

In recent weeks, the state of Maryland has updated many of its tax laws to benefit both businesses and individuals. Below are the important tax updates you should know:

Important Changes for Businesses:

  • Maryland commuter benefit tax credit (L. 2016, H1012 (c. 289)) – Effective July 1, 2016 and applicable to all taxable years beginning after December 31 2015, businesses can claim a commuter benefit state income tax credit equal to 50 percent of the cost of providing commuter benefits to employees, up to $100 per individual employee per month, an increase over the previous $50 per individual employee per month.  In addition, the minimum seating capacity for vehicles used in carpools was reduced from eight to six individuals, enhancing eligibility for the tax credit. This credit cannot exceed the total tax owed by the business, and is not eligible to be carried forward to subsequent tax years.
  • Transfers of controlling interests in real property (L. 2016, S597 (c. 223)) – Effective July 1, 2016, the exemption from recordation and transfer taxes for transfers of controlling interests in real property has been amended to apply if:
    • The transferee of the controlling interest in the real property entity is a nonstock corporation organized under Title 5, Subtitle 2 of the Corporations and Associations Article and is registered with the Department of Aging as a continuing care retirement community under 10-408 of the Human Services Article.
    • The ownership interests in the transferee entity are owned, directly or indirectly, by the same persons and in the same proportions as the transferor entity.
    • The transfer is effected in more than one transaction over a period of more than 12 months or the transfer is not made in accordance with a plan of transfer.
    • The transfer of real property owned by a real property entity between the same transferor and transferee of the controlling interest under the same circumstances would have been exempt under Md. Code Ann. Tax-Prop §12-108.
  • Surplus lines of insurance (L. 2016, H554 (c. 208)) – Effective October 1, 2016, the state of Maryland will allow surplus lines of insurance to be purchased from a non-admitted insurer in the state of Maryland, if the following apply:
    • The surplus line of insurance is in excess of the coverage available from an admitted insurer (or coverage is unavailable from an admitted insurer); and
    • The surplus line of insurance’s coverage is effective for a limited period of time which involves travel to or from the U.S. in a specified manner.

Important Change for Individuals:

  • MD College Savings Accounts Contributions (L. 2016, S374 (c. 197)) – Effective July 1, 2016 and applicable to all taxable years beginning after December 31, 2015, account holders, and now contributors, to a MD prepaid college trust account, Maryland college investment plan, or Maryland broker-dealer college investment plan account, will receive an income tax subtraction up to $2,500 per beneficiary. Any amount contributed over the $2,500 limit will be carried forward to subsequent tax years.

If you have any questions about how to best take advantage of these tax changes, please contact SC&H Group’s Tax Services team here.

Sign Up And Stay Informed

Your data is safe and secure. SC&H will never share or sell your information with any 3rd party vendors. Guaranteed.

Related Resources

Preparing for the Future of Your Cannabusiness [Blog Post]

View

Understanding and Planning for Section 280E as a Medical Cannabis Business [Blog Post]

View

Weekly News Round Up: Jobless Claims at 43-Year Low; AICPA Outlines Tax Reform Policies; and Personal Finance Myths

View

Weekly News Round Up: Trump Victory and Impact on Financial Arena; Retail Sales Rise; and 2016 Malware Moments

View