Tax - Fees for Electronic Filing of Tax Documents - Prohibition (Free Filing Act of 2023)
Impact
If enacted, HB 396 will significantly alter the landscape of tax preparation in Maryland. Tax return preparers and software companies that violate the provisions outlined in the bill will face civil penalties, which include a fine of $500 for first violations and $1,000 for subsequent offenses. This legislative measure will also compel software companies to standardize their offerings, banning the sale of both fee-charging and non-fee-charging versions of the same tax software, which could potentially streamline the market and simplify the choices available to consumers.
Summary
House Bill 396, known as the Free Filing Act of 2023, aims to prohibit tax return preparers and software companies from charging separate fees for the electronic filing of authorized tax documents. This bill is designed to ensure that individuals preparing their taxes have access to cost-effective options and can file their documents electronically without incurring additional charges. By mandating that no separate fee can be imposed, the bill seeks to promote fairness and accessibility in the tax filing process, especially for lower-income taxpayers who rely on electronic filing solutions.
Contention
Notable points of contention surrounding HB 396 may arise from stakeholders within the tax preparation industry. Some tax preparers and software companies may argue that the prohibition on charging for electronic filing will hinder their ability to offer diverse services or cover operational costs. Critics may voice concerns about the potential for reduced quality of software offered if companies cannot recoup fees from consumers. Additionally, debates may emerge regarding the extent of government regulation in the private sector and how it impacts service providers.
Relating to signing electronic or digital court documents, to the electronic filing system established by the Texas Supreme Court, to the statewide electronic filing system fund, to certain court fees and court costs, and to recovery of electronic filing fees by taxing units; imposing and authorizing certain fees.