Maryland: Fourth Amnesty Program Expected to Start Sept. 1, 2015

Maryland Gov. Hogan is set to sign a tax amnesty law for 2015, the details of which are in Senate Bill 763 and House Bill 1233. The 60-day amnesty period will run from Sept. 1, 2015 to Oct. 31, 2015. The program will waive 50 percent of the interest imposed, and all civil penalties (except previously assessed penalties for fraudulent reporting) associated with the nonpayment, non-reporting, or underreporting of individual income taxes, corporate income taxes, withholding taxes, sales and use taxes, or admissions and amusement taxes which were due on or before Dec. 31, 2014.

The amnesty program allows a taxpayer to pursue any of the following:

1. File a delinquent return and pay the delinquent tax, including one-half interest;
2. Pay the tax and one-half interest on a previously filed return; or
3. Enter into an agreement with the comptroller to pay the tax and one-half interest.

Certain taxpayers are ineligible, including taxpayers that were previously granted amnesty between calendar years 1999 and 2014.

Maryland, like other states, periodically offers amnesty programs in an effort to recoup lost revenues. In 2009, from Sept. 1 to Oct. 31, Maryland implemented a program similar to the 2015 version and focused on the same categories of tax. Under that program the state also waived 50 percent of the interest and all civil penalties and exempted the same groups. By the middle of March 2010, the state collected $29.7 million from the program, which was more than triple the $5 million to $10 million the program was expected to generate.

Prior to 2009, the 2001 amnesty program raised $39.4 million within six months, while once again focusing on the same types of taxes and exempted the same types of groups. Based on data from the previous amnesty in 1987, the state expected to raise almost twice that amount, or $70.1 million.

Maryland’s first amnesty offer was in 1987, which raised $34.6 million.