EXPLANATION: CAPITALS INDICATE MATTER ADDE D TO EXISTING LAW .
[Brackets] indicate matter deleted from existing law.
*hb0744*
HOUSE BILL 744
Q3 4lr2827
CF SB 702
By: Delegate Chang
Introduced and read first time: January 31, 2024
Assigned to: Ways and Means
A BILL ENTITLED
AN ACT concerning 1
Income Tax – Biotechnology Investment Incentive Tax Credit Program – 2
Pass–Through Entities 3
FOR the purpose of allowing a qualified investor that is a pass–through entity that pays a 4
certain income tax on behalf of its members to receive and allocate in any manner a 5
credit or refund of a credit under the Biotechnology Investment Incentive Tax Credit 6
Program; and generally relating to the Biotechnology Investment Incentive Tax 7
Credit Program. 8
BY repealing and reenacting, without amendments, 9
Article – Tax – General 10
Section 10–725(a)(1) and (6) and (b)(2) 11
Annotated Code of Maryland 12
(2022 Replacement Volume and 2023 Supplement) 13
BY adding to 14
Article – Tax – General 15
Section 10–725(b)(5) 16
Annotated Code of Maryland 17
(2022 Replacement Volume and 2023 Supplement) 18
BY repealing and reenacting, with amendments, 19
Article – Tax – General 20
Section 10–725(d)(3) 21
Annotated Code of Maryland 22
(2022 Replacement Volume and 2023 Supplement) 23
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLA ND, 24
That the Laws of Maryland read as follows: 25
Article – Tax – General 26 2 HOUSE BILL 744
10–725. 1
(a) (1) In this section the following words have the meanings indicated. 2
(6) (i) “Qualified investor” means any individual or entity that invests 3
at least $25,000 in a qualified Maryland biotechnology company and that is required to file 4
an income tax return in any jurisdiction. 5
(ii) “Qualified investor” does not include: 6
1. a qualified pension plan, individual retirement account, or 7
other qualified retirement plan under the Employee Retirement Income Security Act of 8
1974, as amended, or fiduciaries or custodians under such plans, or similar tax–favored 9
plans or entities under the laws of other countries; or 10
2. a founder or current employee of the qualified Maryland 11
biotechnology company, if the company has been in active business for more than 5 years. 12
(b) (2) Subject to paragraphs (3) and (4) of this subsection and subsections (d) 13
and (e) of this section, for the taxable year in which an investment in a qualified Maryland 14
biotechnology company is made, a qualified investor may claim a credit against the State 15
income tax in an amount equal to the amount of tax credit stated in the final credit 16
certificate approved by the Secretary for the investment as provided under this section. 17
(5) IF THE QUALIFIED INVE STOR ALLOWED TO CLAI M A CREDIT 18
UNDER PARAGRAPH (2) OF THIS SUBSECTION I S A PASS–THROUGH ENTITY THAT 19
PAYS THE INCOME TAX IMPOSED UNDER § 10–102.1 OF THIS TITLE ON BEH ALF OF 20
ALL MEMBERS OF THE P ASS–THROUGH ENTITY, THE PASS–THROUGH ENTITY MAY 21
CLAIM AND ALLOCATE THE CREDIT AMONG THE MEMBERS OF THE PASS–THROUGH 22
ENTITY IN ANY MANNER . 23
(d) (3) (I) If the tax credit allowed under this section in any taxable year 24
exceeds the total tax otherwise payable by the qualified investor for that taxable year, the 25
qualified investor may claim a refund in the amount of the excess. 26
(II) IF THE QUALIFIED INVE STOR ALLOWED TO CLAIM A R EFUND 27
UNDER SUBPARAGRAPH (I) OF THIS PARAGRAPH IS A PASS–THROUGH ENTITY THAT 28
PAYS THE INCOME TAX IMPOSED UNDER § 10–102.1 OF THIS TITLE ON BEH ALF OF 29
ALL MEMBERS OF THE P ASS–THROUGH ENTITY , THE PASS–THROUGH ENTITY MAY 30
CLAIM AND ALLOCATE THE REF UND AMONG THE MEMBER S OF THE PASS–THROUGH 31
ENTITY IN ANY MANNER . 32
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 33
1, 2024, and shall be applicable to all taxable years beginning after December 31, 2023. 34