EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0422*
SENATE BILL 422
Q3 4lr1915
By: Senator Rosapepe
Introduced and read first time: January 19, 2024
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Income Tax – Subtraction Modification – Foreign Service Retirement Income 2
FOR the purpose of allowing a subtraction modification under the Maryland income tax for 3
certain foreign service retirement income received by an individual during the 4
taxable year; providing that foreign service retirement income that is included in the 5
subtraction allowed under this Act may not be taken into account for purposes of a 6
certain subtraction modification under the Maryland income tax for certain 7
retirement income; and generally relating to a subtraction modification under the 8
Maryland income tax for foreign service retirement income. 9
BY repealing and reenacting, without amendments, 10
Article – Tax – General 11
Section 10–207(a) 12
Annotated Code of Maryland 13
(2022 Replacement Volume and 2023 Supplement) 14
BY adding to 15
Article – Tax – General 16
Section 10–207(pp) 17
Annotated Code of Maryland 18
(2022 Replacement Volume and 2023 Supplement) 19
BY repealing and reenacting, with amendments, 20
Article – Tax – General 21
Section 10–209(d) 22
Annotated Code of Maryland 23
(2022 Replacement Volume and 2023 Supplement) 24
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 25
That the Laws of Maryland read as follows: 26
2 SENATE BILL 422
Article – Tax – General 1
10–207. 2
(a) To the extent included in federal adjusted gross income, the amounts under 3
this section are subtracted from the federal adjusted gross income of a resident to determine 4
Maryland adjusted gross income. 5
(PP) (1) IN THIS SUBSECTION , “FOREIGN SERVICE RETIREMENT INCOME ” 6
MEANS RETIREMENT INC OME FROM THE FOREIGN SERVICE RETIREMENT AND 7
DISABILITY SYSTEM OR THE FOREIGN SERVICE PENSION SYSTEM RECEIVED AS A 8
RESULT OF EMPLOYMENT IN THE FOREIGN SERVICE OF THE UNITED STATES. 9
(2) THE SUBTRACTION UNDER SUBSECTION (A) OF THIS SECTION 10
INCLUDES: 11
(I) IF, ON THE LAST DAY OF T HE TAXABLE YEAR , THE 12
INDIVIDUAL IS UNDER THE AGE OF 55 YEARS, THE FIRST $12,500 OF FOREIGN 13
SERVICE RETIREMENT INCOME RE CEIVED BY AN INDIVID UAL DURING THE TAXAB LE 14
YEAR; AND 15
(II) IF, ON THE LAST DAY OF T HE TAXABLE YEAR , THE 16
INDIVIDUAL IS AT LEA ST 55 YEARS OLD, THE FIRST $20,000 OF FOREIGN SERVICE 17
RETIREMENT INCOME RE CEIVED BY AN INDIVID UAL DURING THE TAXAB LE YEAR. 18
10–209. 19
(d) (1) Military retirement income that is included in the subtraction under § 20
10–207(q) of this subtitle may not be taken into account for purposes of the subtraction 21
under this section. 22
(2) Public safety employee retirement income that is included in the 23
subtraction under § 10–207(mm) of this subtitle may not be taken into account for purposes 24
of the subtraction under this section. 25
(3) FOREIGN SERVICE RETIR EMENT INCOME THAT IS INCLUDED IN 26
THE SUBTRACTION UNDE R § 10–207(PP) OF THIS SUBTITLE MAY NOT BE TAKEN INTO 27
ACCOUNT FOR PURPOSES OF THE SUBTRACTION U NDER THIS SECTION. 28
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 29
1, 2024, and shall be applicable to all taxable years beginning after December 31, 2023. 30