WES MOORE, Governor Ch. 731
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Chapter 731
(House Bill 452)
AN ACT concerning
Individual Tax Preparers – Code of Ethics, Notification of Actions, Enforcement,
and Penalties
(Stop Scam Tax Preparers Act)
FOR the purpose of requiring the State Board of Individual Tax Preparers, on or before a
certain date, to publish on the Board’s website a certain code of ethics and certain
rules of professional conduct; requiring the Board to notify the Comptroller within a
certain period of time of certain actions for violations of provisions of law governing
individual tax preparers; requiring the Board to notify the Field Enforcement
Bureau of the Comptroller’s Office of certain alleged violations within a certain
period of time; granting certain employees of the Bureau certain powers, duties, and
responsibilities for enforcing laws pertaining to income tax preparation; requiring
the Comptroller to notify the Board within a certain period of time if the Comptroller
prohibits an income tax return preparer from submitting income tax returns
electronically; prohibiting an income tax return preparer from preparing, assisting
in preparing, or causing the preparation of an income tax return or claim for refund
in a certain manner; requiring certain fines imposed under this Act to be paid to the
Tax Clinics for Low–Income Marylanders Fund; and generally relating to income tax
preparation.
BY repealing and reenacting, without amendments,
Article – Business Occupations and Professions
Section 21–205(b)(1)
Annotated Code of Maryland
(2018 Replacement Volume and 2023 Supplement)
BY adding to
Article – Business Occupations and Professions
Section 21–205(c)
Annotated Code of Maryland
(2018 Replacement Volume and 2023 Supplement)
BY repealing and reenacting, with amendments,
Article – Business Occupations and Professions
Section 21–206 and 21–401
Annotated Code of Maryland
(2018 Replacement Volume and 2023 Supplement)
BY repealing and reenacting, without amendments,
Article – Tax – General
Section 1–207(b) and (c) Ch. 731 2024 LAWS OF MARYLAND
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Annotated Code of Maryland
(2022 Replacement Volume and 2023 Supplement)
BY repealing and reenacting, with amendments,
Article – Tax – General
Section 1–207(f), 2–107(a)(2)(ii), 10–824, and 13–1004
Annotated Code of Maryland
(2022 Replacement Volume and 2023 Supplement)
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
That the Laws of Maryland read as follows:
Article – Business Occupations and Professions
21–205.
(b) In addition to any duties set forth elsewhere, the Board shall:
(1) adopt rules of professional conduct as appropriate to establish a high
standard of integrity and dignity for the practice of individual tax preparation;
(C) ON OR BEFORE JANUARY 1, 2026, AFTER ALLOWING FOR PUBLIC IN PUT
BY THE TAX PREPARER COMMUNITY , THE BOARD SHALL PUBLISH O N THE BOARD’S
WEBSITE A CODE OF ET HICS AND RULES OF PR OFESSIONAL CONDUCT F OR
ENGAGING IN THE PRAC TICE OF INDIVIDUAL T AX PREPARATION .
21–206.
(a) The Board may investigate a complaint that alleges a violation of this title.
(b) On receipt of the results of an investigation made under this section, the Board
shall promptly take action that is appropriate under this title to ensure compliance with
this title.
(c) (1) If the Board concludes that conduct alleged to be in violation of this title
will result in harm to a resident of the State, the Board may seek a permanent or temporary
injunction with respect to the conduct from the circuit court of the county in which the
alleged violation occurs.
(2) In seeking an injunction under this subsection, the Board is not
required to:
(i) post bond;
(ii) allege or prove that an adequate remedy at law does not exist; or
WES MOORE, Governor Ch. 731
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(iii) allege or prove that substantial or irreparable damage would
result from the continued violation.
(3) IF THE BOARD SEEKS AN INJUNC TION OR TAKES A DISC IPLINARY
ACTION AGAINST AN IN DIVIDUAL FOR A VIOLA TION OF THIS TITLE , THE BOARD
SHALL NOTIFY THE COMPTROLLER WITHIN 5 BUSINESS DAYS AFTER TAKING THE
ACTION.
[(3)] (4) A member of the Board may not be held personally liable for
action taken under this subsection in good faith with reasonable grounds.
(d) The Board, or a hearing officer designated by the Board, may administer
oaths, hold hearings, and take testimony about all matters within the jurisdiction of the
Board.
(e) (1) The Board or its designee may issue a subpoena for the attendance of a
witness to testify or the production of evidence in connection with:
(i) a disciplinary action brought under this title; or
(ii) a proceeding brought for an alleged violation of this title.
(2) If an individual fails to comply with a subpoena issued under this
subsection, on petition of the Board, a court of competent jurisdiction may compel
compliance with the subpoena.
21–401.
(a) Except as otherwise provided in this title, an individual may not provide,
attempt to provide, or offer to provide individual tax preparation services in the State
unless registered by the Board.
(b) Except as otherwise provided in this title, a person may not employ an
individual to provide, attempt to provide, or offer to provide individual tax preparation
services in the State unless the individual is registered by the Board.
(C) THE BOARD SHALL NOTIFY TH E FIELD ENFORCEMENT BUREAU OF THE
COMPTROLLER ’S OFFICE OF AN ALLEGED A VIOLATION OF THIS SE CTION WITHIN 5
BUSINESS DAYS AFTER RECEIPT OF THE ALLEG ATION THE BOARD DETERMINES
THAT THE VIOLATION H AS OCCURRED .
Article – Tax – General
1–207.
(b) There is a Tax Clinics for Low–Income Marylanders Fund. Ch. 731 2024 LAWS OF MARYLAND
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(c) The purpose of the Fund is to provide grants to the University of Maryland
School of Law, the University of Baltimore School of Law, and the Maryland Volunteer
Lawyers Service to operate tax clinics for low–income Maryland residents.
(f) The Fund consists of:
(1) proceeds distributed to the Fund under § 17–317 of the Commercial
Law Article;
(2) FINES DISTRIBUTED TO THE FUND UNDER § 13–1004(C) OF THIS
ARTICLE;
(3) money appropriated in the State budget for the Fund; and
[(3)] (4) any other money from any other source accepted for the benefit
of the Fund.
2–107.
(a) Authorized employees of the Field Enforcement Bureau of the Comptroller’s
Office:
(2) have all the powers, duties, and responsibilities of a peace officer for the
purpose of enforcing the laws pertaining to:
(ii) income tax AND INCOME TAX PREPA RATION;
10–824.
(a) (1) In this section the following words have the meanings indicated.
(2) (i) “Income tax return preparer” means a person who for
compensation prepares a substantial portion or more of a qualified return or employs one
or more persons to prepare for compensation a substantial portion or more of a qualified
return.
(ii) “Income tax return preparer” does not include a person who
merely performs those acts described under § 7701(a)(36)(B) of the Internal Revenue Code.
(3) “Qualified return” means any original return of individual income tax
imposed by this title, regardless of whether a tax is due or a refund is claimed.
(b) Except as otherwise provided in this section, an income tax return preparer
shall file all qualified returns that the income tax return preparer prepares by electronic
means as prescribed by the Comptroller if: WES MOORE, Governor Ch. 731
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(1) for a taxable year beginning after December 31, 2008, but before
January 1, 2010, the income tax return preparer has prepared more than 300 qualified
returns in the prior taxable year;
(2) for a taxable year beginning after December 31, 2009, but before
January 1, 2011, the income tax return preparer has prepared more than 200 qualified
returns in the prior taxable year; and
(3) for any taxable year beginning after December 31, 2010, the income tax
return preparer has prepared more than 100 qualified tax returns in the prior taxable year.
(c) Subsection (b) of this section does not apply to a qualified return if:
(1) the taxpayer has indicated on the qualified return that the taxpayer
does not want the return filed by electronic means; or
(2) the income tax return preparer preparing the qualified return has
requested and received a waiver from the Comptroller.
(d) On written request for a waiver by an income tax return preparer who is
subject to subsection (b) of this section, the Comptroller may grant the income tax return
preparer a waiver of the requirements of this section if the income tax return preparer is
able to establish to the satisfaction of the Comptroller either reasonable cause for not filing
the return by electronic means or that there is no feasible means of filing the return by
electronic means without undue hardship.
(E) IF THE COMPTROLLER PROHIBITS AN INCOME TAX RETURN PREPARER
FROM SUBMITTING INCO ME TAX RETURNS ELECT RONICALLY, THE COMPTROLLER
SHALL NOTIFY THE STATE BOARD OF INDIVIDUAL TAX PREPARERS ESTABLISHED
UNDER TITLE 21 OF THE BUSINESS OCCUPATIONS AND PROFESSIONS ARTICLE
WITHIN 5 BUSINESS DAYS AFTER TAKING THAT ACTION .
13–1004.
(a) An income tax return preparer who willfully prepares, assists in preparing, or
causes the preparation of a false income tax return or claim for refund with fraudulent
intent or the intent to evade income tax is guilty of a misdemeanor and, on conviction, is
subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.
(b) An income tax return preparer who willfully attempts to evade any tax
imposed under this article or the payment thereof is guilty of a misdemeanor and, on
conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years
or both.
Ch. 731 2024 LAWS OF MARYLAND
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(C) (1) AN INCOME TAX RETURN PREPARER MAY NOT WIL LFULLY
PREPARE, ASSIST IN PREPARING , OR CAUSE THE PREPARA TION OF AN INCOME TA X
RETURN OR CLAIM FOR REFUND WITHOUT BEING PROPERLY LICENSED OR
REGISTERED TO PROVID E INCOME TAX PREPARA TION SERVICES IN THE STATE.
(2) A PERSON WHO VIOLATES PARAGRAPH (1) OF THIS SUBSECTION
IS GUILTY OF A MISDE MEANOR AND ON CONVIC TION IS SUBJECT TO A FINE NOT
EXCEEDING $5,000 FOR EACH VIOLATION .
(3) EACH INCOME TAX RETUR N OR CLAIM FOR REFUN D THAT AN
INCOME TAX PREPARER PR EPARES, ASSISTS IN PREPARING , OR CAUSES THE
PREPARATION OF IN VI OLATION OF PARAGRAPH (1) OF THIS SUBSECTION I S A
SEPARATE VIOLATION .
(4) EACH FINE IMPOSED UND ER THIS SUBSECTION S HALL BE PAID
INTO THE TAX CLINICS FOR LOW–INCOME MARYLANDERS FUND ESTABLISHED
UNDER § 1–207 OF THIS ARTICLE.
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect
October 1, 2024.
Approved by the Governor, May 16, 2024.