MD
Maryland House Bill HB634

Maryland 2025 Regular Session

Maryland House Bill HB634 Compare Versions

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33 EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
44 [Brackets] indicate matter deleted from existing law.
55 Underlining indicates amendments to bill.
66 Strike out indicates matter stricken from the bill by amendment or deleted from the law by
77 amendment.
8- Italics indicate opposite chamber/conference committee amendments.
98 *hb0634*
109
1110 HOUSE BILL 634
12-Q3 (5lr2623)
13-ENROLLED BILL
14-— Ways and Means/Budget and Taxation —
15-Introduced by Delegates Wims and Mireku –North
16-
17-Read and Examined by Proofreaders:
18-
19-_______________________________________________
20-Proofreader.
21-_______________________________________________
22-Proofreader.
23-
24-Sealed with the Great Seal and presented to the Governor, for his approval this
25-
26-_______ day of _______________ at _______________ _________ o’clock, ________M.
27-
28-______________________________________________
29-Speaker.
11+Q3 5lr2623
12+ CF SB 295
13+By: Delegates Wims and Mireku–North
14+Introduced and read first time: January 23, 2025
15+Assigned to: Ways and Means
16+Committee Report: Favorable
17+House action: Adopted with floor amendments
18+Read second time: March 2, 2025
3019
3120 CHAPTER ______
3221
3322 AN ACT concerning 1
3423
3524 Income Tax – Income Tax Reconciliation Program – Established 2
3625 (Maryland Fair Taxation for Justice–Involved Individuals Act) 3
3726
3827 FOR the purpose of establishing the Income Tax Reconciliation Program in the State to 4
3928 allow certain justice–involved individuals to establish payment plans and receive a 5
4029 waiver of any interest and penalties that accrue for unpaid income tax due for certain 6
4130 taxable years; requiring the Comptroller to administer the Program and waive 7
4231 certain interest and penalties for participants in the Program; requiring the 8
4332 Comptroller, in collaboration with the Department of Public Safety and Correctional 9
4433 Services, to develop an awareness campaign to inform the public and 10
4534 justice–involved individuals about the Program; and generally relating to the Income 11
4635 Tax Reconciliation Program for justice–involved individuals. 12
4736
4837 BY adding to 13
49- Article – Criminal Procedure 14 2 HOUSE BILL 634
38+ Article – Criminal Procedure 14
39+Section 6–237 15
40+Annotated Code of Maryland 16
41+ (2018 Replacement Volume and 2024 Supplement) 17
42+
43+BY adding to 18
44+ Article – Tax – General 19
45+Section 2–120 20
46+ Annotated Code of Maryland 21
47+ (2022 Replacement Volume and 2024 Supplement) 22
48+ 2 HOUSE BILL 634
5049
5150
52-Section 6–237 1
53-Annotated Code of Maryland 2
54- (2018 Replacement Volume and 2024 Supplement) 3
51+BY repealing and reenacting, without amendments, 1
52+ Article – Tax – General 2
53+Section 13–604 and 13–701(a) 3
54+ Annotated Code of Maryland 4
55+ (2022 Replacement Volume and 2024 Supplement) 5
5556
56-BY adding to 4
57- Article – Tax – General 5
58-Section 2–120 6
59- Annotated Code of Maryland 7
60- (2022 Replacement Volume and 2024 Supplement) 8
57+BY repealing and reenacting, with amendments, 6
58+ Article – Tax – General 7
59+Section 13–606 and 13–714 8
60+ Annotated Code of Maryland 9
61+ (2022 Replacement Volume and 2024 Supplement) 10
6162
62-BY repealing and reenacting, without amendments, 9
63- Article – Tax – General 10
64-Section 13–604 and 13–701(a) 11
65- Annotated Code of Maryland 12
66- (2022 Replacement Volume and 2024 Supplement) 13
63+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 11
64+That the Laws of Maryland read as follows: 12
6765
68-BY repealing and reenacting, with amendments, 14
69- Article – Tax – General 15
70-Section 13–606 and 13–714 16
71- Annotated Code of Maryland 17
72- (2022 Replacement Volume and 2024 Supplement) 18
66+Article – Criminal Procedure 13
7367
74- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 19
75-That the Laws of Maryland read as follows: 20
68+6–237. 14
7669
77-Article – Criminal Procedure 21
70+ WHEN A DEFENDANT IS C ONVICTED OF OR PLEAD S GUILTY TO A CRIME AN D IS 15
71+SENTENCED TO A TERM OF IMPRISONMENT OF A T LEAST 6 MONTHS BUT NOT MORE 16
72+THAN 10 YEARS, THE COURT SHALL INFO RM THE DEFENDANT ABO UT THE INCOME 17
73+TAX RECONCILIATION PROGRAM ESTABLISHED U NDER § 2–120 OF THE TAX – 18
74+GENERAL ARTICLE. 19
7875
79-6–237. 22
76+Article – Tax – General 20
8077
81- WHEN A DEFENDANT IS C ONVICTED OF OR PLEAD S GUILTY TO A CRIME AND IS 23
82-SENTENCED TO A TERM OF IMPRISONMENT OF A T LEAST 6 MONTHS BUT NOT MORE 24
83-THAN 10 YEARS, THE COURT SHALL INFO RM THE DEFENDANT ABO UT THE INCOME 25
84-TAX RECONCILIATION PROGRAM ESTABLISHED U NDER § 2–120 OF THE TAX – 26
85-GENERAL ARTICLE. 27
78+2–120. 21
8679
87-Article – Tax – General 28
80+ (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 22
81+INDICATED. 23
8882
89-2–120. 29
83+ (2) (I) “JUSTICE–INVOLVED INDIVIDUAL ” MEANS AN INDIVIDUAL 24
84+WHO IS CONVICTED OF OR PLEADS GUILTY TO A CRIME AND IS CURRE NTLY SERVING 25
85+OR, WITHIN THE IMMEDIATELY PRECEDIN G 2 YEARS, HAS BEEN RELEASED AF TER 26
86+SERVING A TERM OF IM PRISONMENT OF AT LEA ST 6 MONTHS BUT NOT MORE THAN 27
87+10 YEARS IN A STATE OR FEDERAL CORR ECTIONAL FACILITY . 28
9088
91- (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 30
92-INDICATED. 31
89+ (II) “JUSTICE–INVOLVED INDIVIDUAL ” DOES NOT INCLUDE AN 29
90+INDIVIDUAL WHO IS CONVICTED OF OR PLEA DS GUILTY TO A CRIME THAT WAS 30
91+COMMITTED WHILE THE INDIVIDUAL WAS HOLDI NG AN ELECTED PUBLIC OFFICE. 31
9392
94- (2) (I) “JUSTICE–INVOLVED INDIVIDUAL ” MEANS AN INDIVIDUAL 32
95-WHO IS CONVICTED OF OR PLEADS GUILTY TO A CRIME AND IS CURRE NTLY SERVING 33
96-OR, WITHIN THE IMMEDIATE LY PRECEDING 2 YEARS, HAS BEEN RELEASED AF TER 34 HOUSE BILL 634 3
93+ (3) “PROGRAM” MEANS THE INCOME TAX RECONCILIATION 32
94+PROGRAM. 33
95+ HOUSE BILL 634 3
9796
9897
99-SERVING A TERM OF IM PRISONMENT OF AT LEA ST 6 MONTHS BUT NOT MOR E THAN 1
100-10 YEARS IN A STATE OR FEDERAL CORR ECTIONAL FACILITY . 2
98+ (B) THERE IS AN INCOME TAX RECONCILIATION PROGRAM IN THE STATE 1
99+THAT IS ADMINISTERED BY THE COMPTROLLER . 2
101100
102- (II) “JUSTICE–INVOLVED INDIVIDUAL ” DOES NOT INCLUDE AN 3
103-INDIVIDUAL WHO IS CO NVICTED OF OR PLEADS GUILTY TO A CRIME TH AT WAS 4
104-COMMITTED WHILE THE INDIVIDUAL WAS HOLDI NG AN ELECTED PUBLIC OFFICE. 5
101+ (C) THE PURPOSE OF THE PROGRAM IS TO ALLOW J USTICE–INVOLVED 3
102+INDIVIDUALS WHO ARE UNABLE TO FILE A STATE INCOME TAX RETU RN WHILE 4
103+INCARCERATED TO : 5
105104
106- (3) “PROGRAM” MEANS THE INCOME TAX RECONCILIATION 6
107-PROGRAM. 7
105+ (1) SUBJECT TO SUBSECTIO N (D) OF THIS SECTION , ESTABLISH 6
106+INSTALLMENT PAYMEN T PLANS TO PAY ANY U NPAID INCOME TAX THA T IS DUE FOR 7
107+ANY TAXABLE YEAR DUR ING WHICH THE INDIVI DUAL IS INCARCERATED ; AND 8
108108
109- (B) THERE IS AN INCOME TAX RECONCILIATION PROGRAM IN THE STATE 8
110-THAT IS ADMINISTERED BY THE COMPTROLLER . 9
109+ (2) IF APPROVED FOR AN I NSTALLMENT PAYMENT P LAN, RECEIVE A 9
110+WAIVER FOR ANY INTER EST AND PENALTIES TH AT ACCRUE ON THE UNP AID INCOME 10
111+TAX. 11
111112
112- (C) THE PURPOSE OF THE PROGRAM IS TO ALLOW J USTICE–INVOLVED 10
113-INDIVIDUALS WHO ARE UNABLE TO FILE A STATE INCOME TAX RETU RN WHILE 11
114-INCARCERATED TO : 12
113+ (D) (1) FOR ANY TAXABLE YEAR THAT BEGINS AFTER DECEMBER 31, 12
114+2024, BUT BEFORE JANUARY 1, 2030, A JUSTICE–INVOLVED INDIVIDUAL WHO 13
115+RECEIVES A NOTICE OF ASSESSMENT OF INCOME TAX DUE FOR A TAXABL E YEAR 14
116+DURING WHICH THE IND IVIDUAL IS INCARCERA TED MAY APPLY T O THE 15
117+COMPTROLLER FOR AN IN STALLMENT PAYMENT PL AN. 16
115118
116- (1) SUBJECT TO SUBSECTIO N (D) OF THIS SECTION , ESTABLISH 13
117-INSTALLMENT PAYMENT PLANS TO PAY ANY UNP AID INCOME TAX THAT IS DUE FOR 14
118-ANY TAXABLE YEAR DUR ING WHICH THE INDIVI DUAL IS INCARCERATED ; AND 15
119+ (2) IF THE COMPTROLLER DETERMINE S THAT THE 17
120+JUSTICE–INVOLVED INDIVIDUAL IS ELIGIBLE TO PARTI CIPATE IN THE PROGRAM, 18
121+THE COMPTROLLER SHALL EST ABLISH AN INSTALLMEN T PAYMENT PLAN THAT 19
122+ALLOWS THE INDIVIDUA L TO PAY THE UNPAID IN COME TAX OVER A PERI OD NOT 20
123+EXCEEDING 10 YEARS. 21
119124
120- (2) IF APPROVED FOR AN I NSTALLMENT PAYMENT P LAN, RECEIVE A 16
121-WAIVER FOR ANY INTER EST AND PENALTIES TH AT ACCRUE ON THE UNP AID INCOME 17
122-TAX. 18
125+ (3) IF A JUSTICE–INVOLVED INDIVIDUAL IS APPROVED FOR AN 22
126+INSTALLMENT PAYMENT PLAN UNDER THE PROGRAM, THE COMPTROLLER SHALL 23
127+WAIVE ANY INTEREST A ND PENALTIES THAT AC CRUE ON THE UNPAID I NCOME TAX 24
128+DUE. 25
123129
124- (D) (1) FOR ANY TAXABLE YEAR THAT BEGINS AFTER DECEMBER 31, 19
125-2024, BUT BEFORE JANUARY 1, 2030, A JUSTICE–INVOLVED I NDIVIDUAL WHO 20
126-RECEIVES A NOTICE OF ASSESSMENT OF INCOME TAX DUE FOR A TAXABL E YEAR 21
127-DURING WHICH THE IND IVIDUAL IS INCARCERA TED MAY APPLY TO THE 22
128-COMPTROLLER FOR AN IN STALLMENT PAYMENT PL AN. 23
130+ (E) (1) TO CARRY OUT THE PROGRAM, THE COMPTROLLER SHALL : 26
129131
130- (2) IF THE COMPTROLLER DETERMINE S THAT THE 24
131-JUSTICE–INVOLVED IN DIVIDUAL IS ELIGIBLE TO PARTICIPATE IN TH E PROGRAM, 25
132-THE COMPTROLLER SHALL EST ABLISH AN INSTALLMEN T PAYMENT PLAN THAT 26
133-ALLOWS THE INDIVIDUA L TO PAY THE UNPAID INCOME TAX OVER A PE RIOD NOT 27
134-EXCEEDING 10 YEARS. 28
132+ (I) IN COLLABORATION WIT H THE DEPARTMENT OF PUBLIC 27
133+SAFETY AND CORRECTIONAL SERVICES, DEVELOP AN AWARENESS CAMPAIGN TO 28
134+INFORM THE PUBLIC AN D JUSTICE–INVOLVED INDIVIDUALS ABOUT THE PROGRAM; 29
135+AND 30
135136
136- (3) IF A JUSTICE–INVOLVED INDIVIDUAL IS APPROVED FOR AN 29
137-INSTALLMENT PAYMENT PLAN UNDER THE PROGRAM, THE COMPTROLLER SHALL 30
138-WAIVE ANY INTEREST A ND PENALTIES THAT AC CRUE ON THE UNPAID I NCOME TAX 31
139-DUE. 32
137+ (II) ADOPT REGULATIONS . 31
140138
141- (E) (1) TO CARRY OUT THE PROGRAM, THE COMPTROLLER SHALL : 33
142- 4 HOUSE BILL 634
139+ (2) THE REGULATIONS REQUI RED UNDER PARAGRAPH (1)(II) OF THIS 32
140+SUBSECTION MAY INCLU DE INCOME LIMITATION S THAT ESTABLISH ELI GIBILITY 33
141+FOR THE PROGRAM. 34 4 HOUSE BILL 634
143142
144143
145- (I) IN COLLABORATION WIT H THE DEPARTMENT OF PUBLIC 1
146-SAFETY AND CORRECTIONAL SERVICES, DEVELOP AN AWARENESS CAMPAIGN TO 2
147-INFORM THE PUBLIC AN D JUSTICE–INVOLVED INDIVIDUALS ABOUT THE PROGRAM; 3
148-AND 4
149144
150- (II) ADOPT REGULATIONS . 5
145+ (F) ON OR BEFORE DECEMBER 1, 2026, AND EACH DECEMBER 1 1
146+THEREAFTER , THE COMPTROLLER SHALL REP ORT TO THE GENERAL ASSEMBLY, IN 2
147+ACCORDANCE WITH § 2–1257 OF THE STATE GOVERNMENT ARTICLE, ON THE 3
148+IMPACT OF THE PROGRAM. 4
151149
152- (2) THE REGULATIONS REQUI RED UNDER PARAGRAPH (1)(II) OF THIS 6
153-SUBSECTION MAY INCLU DE INCOME LIMITATION S THAT ESTABLISH ELI GIBILITY 7
154-FOR THE PROGRAM. 8
150+13–604. 5
155151
156- (F) ON OR BEFORE DECEMBER 1, 2026, AND EACH DECEMBER 1 9
157-THEREAFTER , THE COMPTROLLER SHALL REP ORT TO THE GENERAL ASSEMBLY, IN 10
158-ACCORDANCE W ITH § 2–1257 OF THE STATE GOVERNMENT ARTICLE, ON THE 11
159-IMPACT OF THE PROGRAM. 12
152+ (a) The rate of interest for each month or fraction of a month is the percent equal 6
153+to one–twelfth of the annual interest rate that the Comptroller sets for the calendar year 7
154+under subsection (b) of this section. 8
160155
161-13–604. 13
156+ (b) On or before October 1 of each year, the Comptroller shall set the annual 9
157+interest rate for the next calendar year on refunds and money owed to the State as the 10
158+percent that equals the greater of: 11
162159
163- (a) The rate of interest for each month or fraction of a month is the percent equal 14
164-to one–twelfth of the annual interest rate that the Comptroller sets for the calendar year 15
165-under subsection (b) of this section. 16
160+ (1) (i) 13% for 2016; 12
166161
167- (b) On or before October 1 of each year, the Comptroller shall set the annual 17
168-interest rate for the next calendar year on refunds and money owed to the State as the 18
169-percent that equals the greater of: 19
162+ (ii) 12% for 2017; 13
170163
171- (1) (i) 13% for 2016; 20
164+ (iii) 11.5% for 2018; 14
172165
173- (ii) 12% for 2017; 21
166+ (iv) 11% for 2019; 15
174167
175- (iii) 11.5% for 2018; 22
168+ (v) 10.5% for 2020; 16
176169
177- (iv) 11% for 2019; 23
170+ (vi) 10% for 2021; 17
178171
179- (v) 10.5% for 2020; 24
172+ (vii) 9.5% for 2022; and 18
180173
181- (vi) 10% for 2021; 25
174+ (viii) 9% for 2023 and each year thereafter; or 19
182175
183- (vii) 9.5% for 2022; and 26
176+ (2) 3 percentage points above the average prime rate of interest quoted by 20
177+commercial banks to large businesses during the State’s previous fiscal year, based on 21
178+determination by the Board of Governors of the Federal Reserve Bank. 22
184179
185- (viii) 9% for 2023 and each year thereafter; or 27
180+13–606. 23
186181
187- (2) 3 percentage points above the average prime rate of interest quoted by 28
188-commercial banks to large businesses during the State’s previous fiscal year, based on 29
189-determination by the Board of Governors of the Federal Reserve Bank. 30
182+ (A) For reasonable cause, a tax collector may waive interest on unpaid tax. 24
183+
184+ (B) THE COMPTROLLER SHALL WAI VE THE AMOUNT OF ANY INTEREST 25
185+ASSESSED ON UNPAID I NCOME TAX DUE UNDER THIS ARTICLE IF: 26
186+
187+ (1) THE UNPAID INCOME TA X IS DUE FOR A TAXABLE YE AR DURING 27
188+WHICH THE PERSON OWI NG IS INCARCERATED ; AND 28
190189 HOUSE BILL 634 5
191190
192191
193-13–606. 1
192+ (2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 1
193+PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 2
194+ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 3
194195
195- (A) For reasonable cause, a tax collector may waive interest on unpaid tax. 2
196+13–701. 4
196197
197- (B) THE COMPTROLLER SHALL WAI VE THE AMOUNT OF ANY INTEREST 3
198-ASSESSED ON UNPAID I NCOME TAX DUE UNDER THIS ARTICLE IF: 4
198+ (a) Except as otherwise provided in this subtitle, if a person or governmental unit 5
199+fails to pay a tax when due under this article, the tax collector shall assess a penalty not 6
200+exceeding 10% of the unpaid tax. 7
199201
200- (1) THE UNPAID INCOME TA X IS DUE FOR A TAXAB LE YEAR DURING 5
201-WHICH THE PERSON OWI NG IS INCARCERATED ; AND 6
202+13–714. 8
202203
203- (2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 7
204-PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 8
205-ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 9
204+ (A) For reasonable cause, a tax collector may waive a penalty under this subtitle. 9
206205
207-13–701. 10
206+ (B) THE COMPTROLLER SHALL WAI VE ANY PENALTY UNDER THIS SUBTITLE 10
207+FOR A PERSON’S FAILURE TO PAY INC OME TAX WHEN DUE UND ER THIS ARTICLE IF: 11
208208
209- (a) Except as otherwise provided in this subtitle, if a person or governmental unit 11
210-fails to pay a tax when due under this article, the tax collector shall assess a penalty not 12
211-exceeding 10% of the unpaid tax. 13
209+ (1) THE UNPAID INCOME TA X IS DUE FOR A TAXAB LE YEAR DURING 12
210+WHICH THE PERSON OWI NG IS INCARCERATED ; AND 13
212211
213-13–714. 14
212+ (2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 14
213+PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 15
214+ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 16
214215
215- (A) For reasonable cause, a tax collector may waive a penalty under this subtitle. 15
216+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 17
217+1, 2025. 18
216218
217- (B) THE COMPTROLLER SHALL WAI VE ANY PENALTY UNDER THIS S UBTITLE 16
218-FOR A PERSON’S FAILURE TO PAY INC OME TAX WHEN DUE UND ER THIS ARTICLE IF: 17
219219
220- (1) THE UNPAID INCOME TA X IS DUE FOR A TAXAB LE YEAR DURING 18
221-WHICH THE PERSON OWI NG IS INCARCERATED ; AND 19
222220
223- (2) THE PERSON APPLIES F OR AND IS PLACED ON AN INSTALLMENT 20
224-PAYMENT PLAN UNDER T HE INCOME TAX RECONCILIATION PROGRAM 21
225-ESTABLISHED UNDER § 2–120 OF THIS ARTICLE. 22
226221
227- SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 23
228-1, 2025. 24
229222
223+Approved:
224+________________________________________________________________________________
225+ Governor.
226+________________________________________________________________________________
227+ Speaker of the House of Delegates.
228+________________________________________________________________________________
229+ President of the Senate.