Maryland 2024 Regular Session

Maryland Senate Bill SB908

Introduced
2/2/24  

Caption

Income Tax - Addition Modification - Interest for and Depreciation of Residential Rental Property

Impact

The bill is anticipated to influence the financial framework surrounding the taxation of rental properties in Maryland. By allowing property owners with a substantial portfolio to deduct interest and depreciation on their tax returns, SB908 aims to promote the availability of affordable rental units. This tax relief could foster investment in housing stock, particularly in areas identified as underdeveloped or in need of economic stimulation. However, it also raises concerns about the long-term implications for both housing affordability and local housing markets.

Summary

Senate Bill 908, introduced by Senator Augustine, addresses modifications to Maryland's income tax with a specific focus on single-family residential rental properties. This bill proposes an addition modification that enables disqualified single-family property owners to receive tax benefits for interest paid and depreciation taken on their residential rental properties. The objective of the bill is to create a more favorable tax environment for landlords who own multiple single-family rental homes, facilitating investments in affordable housing through structured tax incentives.

Contention

Crucially, there is potential contention surrounding the definition of ‘disqualified single-family property owner’ and the implications it has on property taxes and ownership structures. The bill characterizes these owners as those who control at least 25 single-family rental properties, which may be viewed unfavorably by smaller landlords. Advocacy groups may voice objections regarding how such tax deductions could enable a concentration of rental properties in fewer hands, potentially undermining community initiatives aimed at preserving affordable housing through community land trusts and local ownership strategies.

Companion Bills

No companion bills found.

Previously Filed As

MD HB965

Income Tax – Credit for Mold Remediation of Residential Rental Properties

MD HB191

Income Tax - Payments of Fines, Penalties, and Other Amounts - Addition Modification

MD HB337

Income Tax – Capital Gains, Dividends, and Foreign–Derived Intangible Income – Alterations (Investing in Marylanders Act of 2023)

MD HB211

Rental Housing Fund, Calculation of Taxable Income, and Transfer Tax - Alterations (Affordable Housing Investment Act)

MD SB579

Residential Property - Service Agreements - Prohibitions

MD SB945

Sale of Residential Real Property - Offers to Purchase and Transfer Tax

MD HB474

Sale of Residential Real Property - Offers to Purchase and Transfer Tax

MD SB240

Income Tax – Out–of–State Taxes Paid by Pass–Through Entities – Addition Modification

MD HB151

Real Property - Residential Leases - Notification of Rent Increases

MD HB765

Property and Income Taxes - Credits for Construction and Purchase of Housing in Western Maryland

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