EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0822*
SENATE BILL 822
Q1 5lr3252
By: Senator Jennings
Introduced and read first time: January 28, 2025
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Property Tax – Tax Credit for Nonprimary Residence 2
FOR the purpose of providing a credit against the State, county, and municipal corporation 3
property tax imposed on certain nonprimary residences under certain circumstances; 4
requiring the Mayor and City Council of Baltimore City and the governing body of 5
each county and municipal corporation to set, by law, a certain nonprimary residence 6
credit percentage for purposes of calculating the credit under this Act; and generally 7
relating to a property tax credit for nonprimary residences. 8
BY adding to 9
Article – Tax – Property 10
Section 9–112 11
Annotated Code of Maryland 12
(2019 Replacement Volume and 2024 Supplement) 13
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 14
That the Laws of Maryland read as follows: 15
Article – Tax – Property 16
9–112. 17
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 18
INDICATED. 19
(2) “ACTIVE MEMBER ” HAS THE MEANING STATED I N § 9–105 OF THIS 20
SUBTITLE. 21
(3) “AGRICULTURAL OWNERSHI P ENTITY” HAS THE MEANING 22
STATED IN § 9–105 OF THIS SUBTITLE. 23 2 SENATE BILL 822
(4) “HOMEOWNER ” MEANS AN INDIVIDUAL WHO HAS A LEGAL 1
INTEREST IN A NONPRIMARY RESIDENCE OR WHO IS AN ACTIVE MEMBER OF AN 2
AGRICULTURAL OWNERSH IP ENTITY THAT HAS A LEGAL INTEREST IN A 3
NONPRIMARY RESIDENCE. 4
(5) “LEGAL INTEREST ” MEANS AN INTEREST IN A NONPRIMARY 5
RESIDENCE: 6
(I) AS A SOLE OWNER ; 7
(II) AS A JOINT TENANT ; 8
(III) AS A TENANT IN COMMO N; 9
(IV) AS A TENANT BY THE E NTIRETIES; 10
(V) THROUGH MEMBERSHIP I N A COOPERATIVE ; 11
(VI) UNDER A LAND INSTALL MENT CONTRACT , AS DEFINED IN § 12
10–101 OF THE REAL PROPERTY ARTICLE; 13
(VII) AS A HOLDER OF A LIF E ESTATE; OR 14
(VIII) AS A SETTLOR, GRANTOR, OR BENEFICIARY OF A TRUST IF: 15
1. THE SETTLOR , GRANTOR, OR BENEFICIARY OF TH E 16
TRUST DOES NOT PAY R ENT OR OTHER REMUNER ATION TO RESIDE IN T HE 17
NONPRIMARY RESIDENCE; AND 18
2. LEGAL TITLE TO THE NONPRIMARY RESIDENCE IS 19
HELD IN THE NAME OF THE TRUST OR IN THE NAMES OF THE TRUSTEE S FOR THE 20
TRUST. 21
(6) (I) “NONPRIMARY RESIDENCE” MEANS: 22
1. A HOUSE: 23
A. THAT IS NOT USED AS THE PRIN CIPAL RESIDENCE OF 24
THE HOMEOWNER ; 25
B. THAT IS ACTUALLY OCCUPIED OR EXPECTED TO BE 26
ACTUALLY OCCUPIED BY THE HOMEOWNER FOR FE WER THAN 6 MONTHS OF A 27 SENATE BILL 822 3
12–MONTH PERIOD BEGINNI NG WITH THE DATE OF FINALITY FOR THE TAX ABLE 1
YEAR FOR WHICH THE P ROPERTY TAX CREDIT U NDER THIS SECTION IS SOUGHT; AND 2
C. FOR WHICH THE PROPERTY TAX CRE DIT UNDER § 3
9–105 OF THIS SUBTITLE IS NOT APPLICABLE ; AND 4
2. THE LOT OR CU RTILAGE ON WHICH THE HOUSE IS 5
ERECTED. 6
(II) “NONPRIMARY RESIDENCE” INCLUDES: 7
1. A CONDOMINIUM UNIT T HAT IS OCCUPIED BY A N 8
INDIVIDUAL WHO HAS A LEGAL INTEREST IN TH E CONDOMINIUM ; 9
2. AN APARTMENT IN A CO OPERATIVE APARTMENT 10
CORPORATION THAT IS OCCUPIED BY AN INDIV IDUAL WHO HAS A LEGA L INTEREST 11
IN THE APARTMENT ; AND 12
3. A PART OF REAL PROPE RTY USED OTHER THAN 13
PRIMARILY FOR RESIDE NTIAL PURPOSES , IF THE REAL PROPERTY IS USED AS A 14
PRINCIPAL RESIDENCE BY AN INDIVIDUAL WHO HAS A LEGAL INTEREST IN THE REAL 15
PROPERTY. 16
(III) “NONPRIMARY RESIDENCE ” DOES NOT INCLUDE 17
RESIDENTIAL REAL PRO PERTY THAT IS HELD B Y THE OWNER PRIMARIL Y FOR 18
RENTAL, INVESTMENT, OR THE GENERATION OF INCOME. 19
(7) “TAXABLE ASSESSMENT ” HAS THE MEANING STAT ED IN § 9–105 20
OF THIS SUBTITLE. 21
(B) (1) IF THERE IS AN INCREA SE IN PROPERTY ASSES SMENT AS 22
CALCULATED UNDER THI S SECTION, THE STATE AND THE GOVERNI NG BODY OF 23
EACH COUNTY AND OF E ACH MUNICIPAL CORPOR ATION SHALL GRANT A PROPERTY 24
TAX CREDIT UNDER THI S SECTION AGAINST TH E STATE, COUNTY, AND MUNICIPAL 25
CORPORATION PROPERTY TAX IMPOSED ON A NONPRIMARY RESIDENCE OF A 26
HOMEOWNER BY THE STATE, COUNTY, OR MUNICIPAL CORPORA TION. 27
(2) A PROPERTY TAX CREDIT GRANTED UNDER THIS S ECTION SHALL 28
BE APPLICABLE TO ANY STATE, COUNTY, OR MUNICIPAL CORPORATION PROPERTY 29
TAX AND ANY PROPERTY TAX IMPOSED FOR A BI COUNTY COMMISSION . 30
(C) (1) IF A NONPRIMARY RESIDENCE IS NOT USED PRIMARIL Y FOR 31
RESIDENTIAL PURPOSES , THE DEPARTMENT SHALL APPO RTION THE TOTAL 32 4 SENATE BILL 822
PROPERTY ASSESSMENT BETWEEN THE PART OF THE NONPRIMARY RESIDENCE 1
THAT IS USED FOR RES IDENTIAL PURPOSES AN D THE PART OF THE NONPRIMARY 2
RESIDENCE THAT IS NOT USED FOR RESIDENTIAL PURPOSES . 3
(2) (I) FOR A HOMEOWNER WHO I S AN ACTIVE MEMBER O F AN 4
AGRICULTURAL OWNERSH IP ENTITY TO QUALIFY FOR THE PROPERTY TAX CREDIT 5
UNDER THIS SECTION : 6
1. THE NONPRIMARY RESIDENCE MUST HAVE BEEN 7
OWNED AND OCCUPIED B Y THE ACTIVE MEMBER : 8
A. AT THE TIME OF ITS T RANSFER TO THE 9
AGRICULTURAL OWNERSH IP ENTITY; OR 10
B. IF THE AGRICULTURAL OWNERSHIP ENTITY IS A 11
LIMITED LIABILITY COMPANY AND THE NONPRIMARY RESIDENCE WAS ORIGINALLY 12
TRANSFERRED TO THE A GRICULTURAL OWNERSHI P ENTITY AS PART OF A 13
CONVERSION FROM A PA RTNERSHIP UNDER § 4A–211 OF THE CORPORATIONS AND 14
ASSOCIATIONS ARTICLE, THEN AT THE TIME OF ITS TRANSFER TO THE FORMER 15
PARTNERSHIP ; AND 16
2. THE AGRICULTURAL OWN ERSHIP ENTITY AND TH E 17
ACTIVE MEMBER WHO OC CUPIES THE NONPRIMARY RESIDENCE MUST FILE AN 18
APPLICATION WITH THE DEPARTMENT ESTABLISHI NG INITIAL ELIGIBILI TY FOR 19
THE CREDIT ON OR BEF ORE JUNE 30 FOR THE FOLLOWING TA XABLE YEAR AND , AT 20
THE REQUE ST OF THE DEPARTMENT , MUST FILE AN APPLICA TION IN ANY FUTURE 21
YEAR TO VERIFY CONTI NUED ELIGIBILITY . 22
(II) FAILURE TO FILE A TIM ELY APPLICATION MAY RESULT IN 23
DISQUALIFICATION FRO M THE NONPRIMARY RESIDENCE TAX CREDIT PROGRAM 24
FOR THE FOLLOWING TA XABLE YEAR. 25
(D) (1) SUBJECT TO THE PROVIS IONS OF PARAGRAPH (5) OF THIS 26
SUBSECTION, THE DEPARTMENT SHALL AUTH ORIZE AND THE STATE, A COUNTY, OR 27
A MUNICIPAL CORPORAT ION SHALL GRANT A PR OPERTY TAX CREDIT UN DER THIS 28
SECTION FOR A NONPRIMARY RESIDENCE FOR A TAXABLE YEAR UNLESS DURING 29
THE PREVIOUS TAXABLE YEAR: 30
(I) THE HOMEOWNER OF THE NONPRIMARY RESIDENCE DID 31
NOT ALSO MAINTAIN AN D RESIDE IN A DWELLI NG, AS DEFINED UNDER § 9–105 OF 32
THIS SUBTITLE, IN THE STATE; 33
SENATE BILL 822 5
(II) THE NONPRIMARY RESIDENCE WAS TRANSFERRED FOR 1
CONSIDERATION TO NEW OWNERSHIP; 2
(III) THE VALUE OF THE NONPRIMARY RESIDENCE WAS 3
INCREASED DUE TO A C HANGE IN THE ZONING CLASSIFICATION OF TH E 4
NONPRIMARY RESIDENCE INITIATED OR REQUEST ED BY THE HOMEOWNER OR 5
ANYONE HAVING AN INT EREST IN THE PROPERTY ; 6
(IV) THE USE OF THE NONPRIMARY RESIDENCE WAS CHANGED 7
SUBSTANTIALLY ; OR 8
(V) THE ASSESSMENT OF TH E NONPRIMARY RESIDENCE WAS 9
CLEARLY ERRONEOUS DU E TO AN ERROR IN CAL CULATION OR MEASUREM ENT OF 10
IMPROVEMENTS ON THE REAL PROPERTY . 11
(2) A HOMEOWNER MUST ACTUA LLY RESIDE IN THE NONPRIMARY 12
RESIDENCE BY JULY 1 OF THE TAXABLE YEAR FOR WHICH THE PROPER TY TAX 13
CREDIT UNDER THIS SE CTION IS TO BE ALLOW ED. 14
(3) THE CREDIT MAY BE GRA NTED ONLY TO ONE NONPRIMARY 15
RESIDENCE OWNED BY T HE HOMEOWNER . 16
(4) IF A PROPERTY TAX CRE DIT UNDER THIS SECTI ON IS LESS THAN 17
$1 IN ANY TAXABLE YEAR , THE TAX CREDIT MAY N OT BE GRANTED . 18
(5) (I) IF THE NONPRIMARY RESIDENCE WAS TRANSFERRED FOR 19
CONSIDERATION IN A D EED DATED ON OR AFTE R JANUARY 1 BUT BEFORE THE 20
BEGINNING OF THE NEXT TAXABLE YEAR AND THE DEED WA S RECORDED WITH THE 21
CLERK OF THE CIRCUIT COURT OR THE DEPARTMENT ON OR AFTE R JULY 1 BUT 22
BEFORE SEPTEMBER 1 OF THE NEXT TAXABLE YEAR, THE NEW OWNER MAY SU BMIT 23
A WRITTEN APPLICATIO N TO THE DEPARTMENT ON OR BEFO RE SEPTEMBER 1 OF 24
THE SECOND TAXABLE Y EAR FOLLOWING THE DA TE OF THE DEED REQUE STING 25
THAT THE DATE OF THE DEED BE ACCEPTED BY THE DEPARTMENT AS THE DAT E OF 26
TRANSFER UNDER PARAG RAPH (1) OF THIS SUBSECTION . 27
(II) 1. THE APPLICANT SHALL S UBMIT WITH THE WRITT EN 28
APPLICATION A COPY OF TH E EXECUTED DEED EVID ENCING THE DATE OF T HE 29
TRANSFER. 30
2. IF THE APPLICANT FAIL S TO SUBMIT A COPY O F THE 31
EXECUTED DEED AS REQ UIRED UNDER SUBSUBPA RAGRAPH 1 OF THIS 32
SUBPARAGRAPH , THE DEPARTMENT SHALL DENY THE APPLICATION . 33
6 SENATE BILL 822
(III) THE DATE OF THE TRANSFER UNDER THIS PARAGRAPH IS 1
THE EFFECTIVE DATE O F THE DEED AS DESCRI BED UNDER § 3–201 OF THE REAL 2
PROPERTY ARTICLE. 3
(IV) IF A HOMEOWNER SUBMIT S AN ELIGIBLE APPLIC ATION 4
UNDER THIS PARAGRAPH AFTER MAY 1 OF THE FIRST TAXABLE YEAR FOLLOWI NG 5
THE DATE OF THE DEED AND THE HOMEOWNER IS DUE TO RECEIVE A RED UCTION IN 6
THE HOMEOWNER ’S PROPERTY TAX BILL IN THE SECOND TAXABL E YEAR 7
FOLLOWING THE DATE O F THE DEED AS A RESU LT OF THE CREDIT UND ER THIS 8
SECTION, PROPERTY TAX IS NOT DUE ON THE NONPRIMARY RESIDENCE FOR THE 9
SECOND TAXABLE YEAR FOLLOWING THE DATE O F THE DEED UNTIL 30 DAYS AFTER 10
A REVISED TAX BILL I S SENT TO THE HOMEOW NER. 11
(6) (I) EXCEPT AS PROVIDED UN DER PARAGRAPH (7) OF THIS 12
SUBSECTION, TO QUALIFY FOR THE C REDIT UNDER THIS SEC TION, A HOMEOWNER 13
SHALL SUBMIT AN APPL ICATION FOR THE CRED IT TO THE DEPARTMENT AS 14
PROVIDED IN THIS PAR AGRAPH. 15
(II) THE APPLICATION SHALL : 16
1. BE MADE ON THE FORM THAT THE DEPARTMENT 17
PROVIDES; 18
2. PROVIDE THE INFORMAT ION REQUIRED BY THE 19
FORM; 20
3. INCLUDE A STATEMENT BY THE H OMEOWNER UNDER 21
OATH THAT THE FACTS STATED IN THE APPLIC ATION ARE TRUE , CORRECT, AND 22
COMPLETE; AND 23
4. BE FILED ON OR BEFOR E THE MAY 1 PRECEDING THE 24
FIRST TAXABLE YEAR F OR WHICH THE PROPERT Y TAX CREDIT UNDER T HIS SECTION 25
IS TO BE ALLOWED. 26
(III) THE DEPARTMENT SHALL PROV IDE A HOMEOWNER THE 27
OPTION TO SUBMIT THE APPLICATION REQUIRED UNDER THIS PARAGRAPH 28
ELECTRONICALLY ON TH E DEPARTMENT ’S WEBSITE. 29
(7) IF A HOMEOWNER SUBMIT S AN APPLICATION TO THE 30
DEPARTMENT UNDER THIS SECTION AND THE DEPARTMENT DETERMINES THAT 31
THE HOMEOWNER WAS EL IGIBLE FOR THE CREDI T IN THE PRIOR TAXAB LE YEAR BUT 32
FAILED TO FILE AN AP PLICATION FOR THE CR EDIT AS REQUIRED UND ER THIS 33
SUBSECTION: 34 SENATE BILL 822 7
(I) THE HOMEOWNER SHALL BE RETROACTIVELY QUA LIFIED 1
FOR THE NONPRIMARY RESIDENCE PROPERTY TAX CREDIT PROGRAM FOR THE 2
PRIOR TAXABLE YEAR ; AND 3
(II) THE DEPARTMENT SHALL CALC ULATE THE PRIOR YEAR ’S 4
TAXABLE ASSESSMENT A S IF THE CREDIT HAD BEEN GRANTED FOR THE PRIOR 5
TAXABLE YEAR . 6
(E) (1) FOR EACH TAXABLE YEAR , THE PROPERTY T AX CREDIT UNDER 7
THIS SECTION IS CALC ULATED BY: 8
(I) MULTIPLYING THE PRIO R YEAR’S TAXABLE ASSESSMENT BY 9
THE NONPRIMARY RESIDENCE CREDIT PERCENTAGE PROVIDED UNDER 10
PARAGRAPH (2) OF THIS SUBSECTION ; 11
(II) SUBTRACTING THAT AMO UNT FROM THE CURRENT YEAR’S 12
ASSESSMENT ; AND 13
(III) IF THE DIFFERENCE IS A POSITIVE NUMBER , MULTIPLYING 14
THE DIFFERENCE BY TH E APPLICABLE PROPERT Y TAX RATE FOR THE C URRENT 15
YEAR. 16
(2) FOR EACH TAXABLE YEAR , THE NONPRIMARY RESIDENCE CREDIT 17
PERCENTAGE UNDER PAR AGRAPH (1)(I) OF THIS SUBSECTION IS: 18
(I) FOR THE STATE PROPERTY TAX AN D FOR ANY PROPERTY 19
TAX IMPOSED FOR A BI COUNTY COMMISSION , 115%; 20
(II) FOR THE COUNTY PROPE RTY TAX: 21
1. THE NONPRIMARY RESIDENCE CREDIT PERCENTAGE 22
ESTABLISHED BY THE C OUNTY UNDER PARAGRAP H (3) OF THIS SUBSECTION; OR 23
2. IF THE COUNTY HAS NO T SET A PERCENTAGE F OR THE 24
TAXABLE YEAR UNDER P ARAGRAPH (3) OF THIS SUBSECTION O R HAS NOT NOTIFIED 25
THE DEPARTMENT AS REQUIRE D UNDER PARAGRAPH (6) OF THIS SUBSECTION , THE 26
CREDIT PERCENTAGE IN EFFECT FOR THE COUNT Y FOR THE PRECEDING TAXABLE 27
YEAR; AND 28
(III) FOR THE MUNICIPAL CO RPORATION PROPERTY T AX: 29
8 SENATE BILL 822
1. THE NONPRIMARY RESIDENCE CREDIT PERCENTAGE 1
ESTABLISHED BY THE M UNICIPAL CORPORATION UNDER PARAGRAPH (4) OF THIS 2
SUBSECTION; OR 3
2. IF THE MUNICIPAL COR PORATION HAS NOT SET A 4
PERCENTAGE UNDER PAR AGRAPH (4) OF THIS SUBSECTION O R HAS NOT NOTIFIED 5
THE DEPARTMENT AS REQUIRE D UNDER PARAGRAPH (7) OF THIS SUBSECTION , THE 6
NONPRIMARY RESIDENCE CREDIT PERCENTAGE FOR THE T AXABLE YEAR FOR THE 7
COUNTY IN WHICH THE PROPERTY IS LOCATED. 8
(3) SUBJECT TO PARAGRAPH (5) OF THIS SUBSECTION , THE MAYOR 9
AND CITY COUNCIL OF BALTIMORE CITY AND THE GOVERNIN G BODY OF A COUNTY 10
ON OR BEFORE MARCH 15 OF ANY YEAR SHALL SE T, BY LAW, THE NONPRIMARY 11
RESIDENCE CREDIT PERCENTAGE FO R THE TAXABLE YEAR BEGINNI NG THE 12
FOLLOWING JULY 1. 13
(4) SUBJECT TO PARAGRAPH (5) OF THIS SUBSECTION , ON OR 14
BEFORE MARCH 25 OF ANY YEAR , THE GOVERNING BODY O F A MUNICIPAL 15
CORPORATION MAY SET OR ALTER, BY LAW, A NONPRIMARY RESIDENCE CREDIT 16
PERCENTAGE FOR THE T AXABLE YEAR BEGINNING THE FOLLOWING JULY 1 AND ANY 17
SUBSEQUENT TAXABLE Y EAR. 18
(5) THE NONPRIMARY RESIDENCE CREDIT PERCENTAGE FOR ANY 19
COUNTY OR MUNICIPAL CORPORATION PROPERTY TAX: 20
(I) MAY NOT BE LESS THAN 100% OR EXCEED 115% FOR ANY 21
TAXABLE YEAR ; AND 22
(II) SHALL BE EXPRESSED I N INCREMENTS OF 1 PERCENTAGE 23
POINT. 24
(6) THE MAYOR AND CITY COUNCIL OF BALTIMORE CITY AND THE 25
GOVERNING BODY OF A COUNTY SHALL NOTIFY THE DEPARTMENT OF ANY ACT ION 26
TAKEN UNDER PARAGRAP H (3) OF THIS SUBSECTION O N OR BEFORE MARCH 15 27
PRECEDING THE TAXABL E YEAR FOR WHICH THE ACTION IS TAKEN. 28
(7) A MUNICIPAL CORPORATIO N SHALL NOTIFY THE DEPARTMENT 29
OF ANY ACTION TAKEN UNDER PARAGRAPH (4) OF THIS SUBSECTION O N OR BEFORE 30
MARCH 25 PRECEDING THE TAXABL E YEAR FOR WHICH THE ACTION IS TAKEN. 31
(F) A HOMEOWNER WHO MEETS THE REQUIREMENTS OF THIS SECTION 32
SHALL BE GRANTED THE PROPERTY TAX CREDIT UNDER THIS SECTION A GAINST THE 33
STATE, COUNTY, AND MUNICIPAL CORPOR ATION PROPERTY TAX A ND ANY 34 SENATE BILL 822 9
PROPERTY TAX IMPOSED FOR A BICOUNTY COMMI SSION IMPOSED ON T HE REAL 1
PROPERTY OF THE NONPRIMARY RESIDENCE . 2
(G) THE TAX CREDIT UNDER THIS SECTION SHALL B E INCLUDED ON THE 3
HOMEOWNER ’S PROPERTY TAX BILL . 4
(H) THE COMPTROLLER SHALL : 5
(1) COOPERATE WITH THE DEPARTMENT IN ADOPTIN G A PROCEDURE 6
TO AUDIT THE APPLICA TION FORMS SUBMITTED UNDE R THIS SECTION; 7
(2) NOTWITHSTANDING § 13–202 OF THE TAX – GENERAL ARTICLE, 8
PROVIDE ADDITIONAL I NFORMATION TO THE DEPARTMENT ; AND 9
(3) ASSIST THE DEPARTMENT IN A POSTA UDIT OF EACH 10
APPLICATION. 11
(I) THE COUNTIES SHALL RE IMBURSE THE DEPARTMENT FOR THE 12
ADMINISTRATION OF TH E APPLICATION PROCES S UNDER SUBSECTION (D)(6) OF 13
THIS SECTION. 14
(J) THE DEPARTMENT SHALL ADOP T RULES AND REGULATI ONS TO 15
IMPLEMENT THIS SECTI ON. 16
(K) THE TAX CREDIT UNDER THIS SECTION SHALL B E KNOWN AS THE 17
NONPRIMAR Y RESIDENCE PROPERTY TAX CREDIT. 18
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 19
1, 2025, and shall be applicable to all taxable years beginning after June 30, 2025. 20