Maryland SB 166: Corporate Income Tax - Federal Repatriation Holiday

Bill Text

EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0166*

SENATE BILL 166
Q3 8lr1287
SB 205/17 – B&T
By: Senators Serafini, Bates, Eckardt, Edwards, Hershey, Hough, Jennings,
Norman, Ready, Reilly, Salling, and Simonaire
Introduced and read first time: January 15, 2018
Assigned to: Budget and Taxation

A BILL ENTITLED

AN ACT concerning 1

Corporate Income Tax – Federal Repatriation Holiday 2

FOR the purpose of providing a subtraction modification under the Maryland corporate 3
income tax for certain dividends included in federal taxable income as a result of a 4
certain repatriation holiday enacted by certain federal legislation; requiring the 5
Comptroller to provide for the administration of this Act if certain federal legislation 6
is enacted; stating the intent of the General Assembly; providing for the application 7
of this Act; and generally relating to an income tax subtraction modification for 8
certain dividends. 9

BY repealing and reenacting, without amendments, 10
Article – Tax – General 11
Section 10–307(a) 12
Annotated Code of Maryland 13
(2016 Replacement Volume and 2017 Supplement) 14

BY adding to 15
Article – Tax – General 16
Section 10–307(e) 17
Annotated Code of Maryland 18
(2016 Replacement Volume and 2017 Supplement) 19

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 20
That the Laws of Maryland read as follows: 21

Article – Tax – General 22

10–307. 23

(a) To the extent included in federal taxable income, the amounts under this 24

2 SENATE BILL 166

section are subtracted from the federal taxable income of a corporation to determine 1
Maryland modified income. 2

(E) (1) THE SUBTRACTION UNDER SUBSECTION (A) OF THIS SECTION 3
INCLUDES DIVIDENDS RECEIVED BY A CORPORATION FROM A CONTROLLED 4
FOREIGN CORPORATION IF THE DIVIDENDS ARE INCLUDED IN FEDERAL TAXABLE 5
INCOME AS PART OF A REPATRIATION HOLIDAY UNDER § 965 OF THE INTERNAL 6
REVENUE CODE OR ANOTHER SIMILAR PROVISION OF THE INTERNAL REVENUE 7
CODE. 8

(2) THE COMPTROLLER SHALL PROVIDE FOR THE ADMINISTRATION 9
OF THIS SUBSECTION IF FEDERAL LEGISLATION IS ENACTED ESTABLISHING A 10
REPATRIATION HOLIDAY FOR THE DIVIDENDS DESCRIBED IN PARAGRAPH (1) OF 11
THIS SUBSECTION. 12

SECTION 2. AND BE IT FURTHER ENACTED, That it is the intent of the General 13
Assembly that, if federal legislation is enacted that provides for favorable income tax 14
treatment for corporate profits from outside the country that are brought back into the 15
United States, the profits may not be taxable under the Maryland corporate income tax. 16

SECTION 3. AND BE IT FURTHER ENACTED, That this Act shall take effect July 17
1, 2018, and shall be applicable to all taxable years beginning after December 31, 2017. 18