EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0634*
HOUSE BILL 634
Q3 5lr2623
CF SB 295
By: Delegates Wims and Mireku–North
Introduced and read first time: January 23, 2025
Assigned to: Ways and Means
A BILL ENTITLED
AN ACT concerning 1
Income Tax – Income Tax Reconciliation Program – Established 2
(Maryland Fair Taxation for Justice–Involved Individuals Act) 3
FOR the purpose of establishing the Income Tax Reconciliation Program in the State to 4
allow certain justice–involved individuals to establish payment plans and receive a 5
waiver of any interest and penalties that accrue for unpaid income tax due for certain 6
taxable years; requiring the Comptroller to administer the Program and waive 7
certain interest and penalties for participants in the Program; requiring the 8
Comptroller, in collaboration with the Department of Public Safety and Correctional 9
Services, to develop an awareness campaign to inform the public and 10
justice–involved individuals about the Program; and generally relating to the Income 11
Tax Reconciliation Program for justice–involved individuals. 12
BY adding to 13
Article – Criminal Procedure 14
Section 6–237 15
Annotated Code of Maryland 16
(2018 Replacement Volume and 2024 Supplement) 17
BY adding to 18
Article – Tax – General 19
Section 2–120 20
Annotated Code of Maryland 21
(2022 Replacement Volume and 2024 Supplement) 22
BY repealing and reenacting, without amendments, 23
Article – Tax – General 24
Section 13–604 and 13–701(a) 25
Annotated Code of Maryland 26
(2022 Replacement Volume and 2024 Supplement) 27
2 HOUSE BILL 634
BY repealing and reenacting, with amendments, 1
Article – Tax – General 2
Section 13–606 and 13–714 3
Annotated Code of Maryland 4
(2022 Replacement Volume and 2024 Supplement) 5
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEM BLY OF MARYLAND, 6
That the Laws of Maryland read as follows: 7
Article – Criminal Procedure 8
6–237. 9
WHEN A DEFENDANT IS C ONVICTED OF OR PLEAD S GUILTY TO A CRIME AND IS 10
SENTENCED TO A TERM OF IMPRISONMENT OF A T LEAST 6 MONTHS BUT NOT MORE 11
THAN 10 YEARS, THE COURT SHALL INFORM T HE DEFENDANT ABOUT T HE INCOME 12
TAX RECONCILIATION PROGRAM ESTABLISHED U NDER § 2–120 OF THE TAX – 13
GENERAL ARTICLE. 14
Article – Tax – General 15
2–120. 16
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 17
INDICATED. 18
(2) “JUSTICE–INVOLVED INDIVIDUAL ” MEANS AN INDIVIDUAL WHO IS 19
CONVICTED OF OR PLEA DS GUILTY TO A CRIME AND IS CURRENTLY SER VING OR, 20
WITHIN THE IMMEDIATE LY PRECEDING 2 YEARS, HAS BEEN RELEASED AF TER 21
SERVING A TERM OF IM PRISONMENT OF AT LEA ST 6 MONTHS BUT NOT MOR E THAN 22
10 YEARS IN A STATE OR FEDERAL CORR ECTIONAL FACILITY . 23
(3) “PROGRAM” MEANS THE INCOME TAX RECONCILIATION 24
PROGRAM. 25
(B) THERE IS AN INCOME TAX RECONCILIATION PROGRAM IN THE STATE 26
THAT IS ADMINISTERED BY THE COMPTROLLER . 27
(C) THE PURPOSE OF THE PROGRAM IS TO ALLOW JU STICE–INVOLVED 28
INDIVIDUALS WHO ARE UNABLE TO FILE A STATE INCOME TAX RETU RN WHILE 29
INCARCERATED TO : 30
HOUSE BILL 634 3
(1) SUBJECT TO SUBSECTIO N (D) OF THIS SECTION , ESTABLISH 1
INSTALLMENT PAYMENT PLANS TO PAY ANY UNP AID INCOME TAX THAT IS DUE FOR 2
ANY TAXABLE YEAR DURING WH ICH THE INDIVIDUAL I S INCARCERATED ; AND 3
(2) IF APPROVED FOR AN I NSTALLMENT PAYMENT P LAN, RECEIVE A 4
WAIVER FOR ANY INTER EST AND PENALTIES TH AT ACCRUE ON THE UNP AID INCOME 5
TAX. 6
(D) (1) FOR ANY TAXABLE YEAR THAT BEGINS AFTER DECEMBER 31, 7
2024, BUT BEFORE JANUARY 1, 2030, A JUSTICE–INVOLVED INDIVIDUAL WHO 8
RECEIVES A NOTICE OF ASSESSMENT OF INCOME TAX DUE FOR A TAXABL E YEAR 9
DURING WHICH THE IND IVIDUAL IS INCARCERA TED MAY APPLY TO THE 10
COMPTROLLER FOR AN INSTALL MENT PAYMENT PLAN . 11
(2) IF THE COMPTROLLER DETERMINE S THAT THE 12
JUSTICE–INVOLVED INDIVIDUAL IS ELIGIBLE TO PARTI CIPATE IN THE PROGRAM, 13
THE COMPTROLLER SHALL EST ABLISH AN INSTALLMEN T PAYMENT PLAN THAT 14
ALLOWS THE INDIVIDUA L TO PAY THE UNPAID INCOME TAX OV ER A PERIOD NOT 15
EXCEEDING 10 YEARS. 16
(3) IF A JUSTICE–INVOLVED INDIVIDUAL IS APPROVED FOR AN 17
INSTALLMENT PAYMENT PLAN UNDER THE PROGRAM, THE COMPTROLLER SHALL 18
WAIVE ANY INTEREST A ND PENALTIES THAT AC CRUE ON THE UNPAID I NCOME TAX 19
DUE. 20
(E) (1) TO CARRY OUT THE PROGRAM, THE COMPTROLLER SHALL : 21
(I) IN COLLABORATION WIT H THE DEPARTMENT OF PUBLIC 22
SAFETY AND CORRECTIONAL SERVICES, DEVELOP AN AWARENESS CAMPAIGN TO 23
INFORM THE PUBLIC AN D JUSTICE–INVOLVED INDIVIDUALS ABOUT THE PROGRAM; 24
AND 25
(II) ADOPT REGULATIONS . 26
(2) THE REGULATIONS REQUI RED UNDER PARAGRAPH (1)(II) OF THIS 27
SUBSECTION MAY INCLU DE INCOME LIMITATION S THAT ESTABLISH ELI GIBILITY 28
FOR THE PROGRAM. 29
(F) ON OR BEFORE DECEMBER 1, 2026, AND EACH DECEMBER 1 30
THEREAFTER , THE COMPTROLLER SHALL REPORT T O THE GENERAL ASSEMBLY, IN 31
ACCORDANCE WITH § 2–1257 OF THE STATE GOVERNMENT ARTICLE, ON THE 32
IMPACT OF THE PROGRAM. 33
4 HOUSE BILL 634
13–604. 1
(a) The rate of interest for each month or fraction of a month is the percent equal 2
to one–twelfth of the annual interest rate that the Comptroller sets for the calendar year 3
under subsection (b) of this section. 4
(b) On or before October 1 of each year, the Comptroller shall set the annual 5
interest rate for the next calendar year on refunds and money owed to the State as the 6
percent that equals the greater of: 7
(1) (i) 13% for 2016; 8
(ii) 12% for 2017; 9
(iii) 11.5% for 2018; 10
(iv) 11% for 2019; 11
(v) 10.5% for 2020; 12
(vi) 10% for 2021; 13
(vii) 9.5% for 2022; and 14
(viii) 9% for 2023 and each year thereafter; or 15
(2) 3 percentage points above the average prime rate of interest quoted by 16
commercial banks to large businesses during the State’s previous fiscal year, based on 17
determination by the Board of Governors of the Federal Reserve Bank. 18
13–606. 19
(A) For reasonable cause, a tax collector may waive interest on unpaid tax. 20
(B) THE COMPTROLLER SHALL WAI VE THE AMOUNT OF ANY INTEREST 21
ASSESSED ON UNPAID I NCOME TAX DUE UNDER THIS ARTICLE IF: 22
(1) THE UNPAID INCOME TA X IS DUE FOR A TAXAB LE YEAR DURING 23
WHICH THE PERSON OWI NG IS INCARCERATED ; AND 24
(2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 25
PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 26
ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 27
13–701. 28
HOUSE BILL 634 5
(a) Except as otherwise provided in this subtitle, if a person or governmental unit 1
fails to pay a tax when due under this article, the tax collector shall assess a penalty not 2
exceeding 10% of the unpaid tax. 3
13–714. 4
(A) For reasonable cause, a tax collector may waive a penalty under this subtitle. 5
(B) THE COMPTROLLER SHALL WAI VE ANY PENALTY UNDER THIS SUBTITLE 6
FOR A PERSON’S FAILURE TO PAY INC OME TAX WHEN DUE UND ER THIS ARTICLE IF: 7
(1) THE UNPAID INCOME TA X IS DUE FOR A TAXAB LE YEAR DURING 8
WHICH THE PERSON OWI NG IS INCARCERATED ; AND 9
(2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 10
PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 11
ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 12
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 13
1, 2025. 14