# Tax - General (GTG)

## Title 13. Procedure

### Subtitle 1. Definitions; General Provisions

#### Section 13-101

(a) In this title the following words have the meanings indicated.

(b)

  (1) "Demand response trip" means the carriage of a passenger who is unable to use regular schedule, fixed termini services.

  (2) "Demand response trip" includes a trip that is required under the federal Americans with Disabilities Act.

(c) "Governmental entity" means:

  (1) a governmental unit; and

  (2) an instrumentality of:

    (i) one or more states;

    (ii) one or more political subdivisions of a state; or

    (iii) one or more states and political subdivisions of states.

(d) "Governmental unit" means:

  (1) this State or a political subdivision, unit, or instrumentality of this State;

  (2) another state or a political subdivision, unit, or instrumentality of that state; and

  (3) a unit or instrumentality of a political subdivision of this State or of another state.

(e)

  (1) "Tax collector" means the person or governmental unit responsible for collecting a tax.

  (2) "Tax collector" includes:

    (i) the Comptroller;

    (ii) the Department, with respect to:

      (1) the financial institution franchise tax; and

      (2) the public service company franchise tax; and

    (iii) the registers of wills, with respect to the inheritance tax.

(f) "Tax compliance activity" means any activity that supports the Comptroller in administering the laws described in Sec. 2-102 of this article.

(g) "Tax compliance organization" means an organization:

  (1) a purpose of which is to assist state tax officials in ensuring compliance with and enforcing state and federal tax laws;

  (2) the membership of which consists solely of:

    (i) states; or

    (ii) state tax collectors, comptrollers, or directors of revenue and their employees; and

  (3) of which the State is a member or participant.

#### Section 13-102

(a) Unpaid tax and interest and penalties on the tax are, from the due date, the personal debt of the person required to pay the tax.

(b) Subsection (a) of this section does not add to or otherwise change the personal liability of an officer of a corporation under any other provision of law.

#### Section 13-103

(a) A tax collector shall apply a payment under this title first to any penalty and accrued interest and then to the unpaid tax.

(b) This section does not affect the authority of a tax collector to compromise claims or to abate or waive penalties or interest.

#### Section 13-104

(a)

  (1) Subject to the approval of the Treasurer and subject to the limitation under paragraph (2) of this subsection, the Comptroller or the Department may provide by regulation for the payment of any unpaid tax liability in connection with a tax return, report, or other document required to be filed with the Comptroller or the Department in funds that are immediately available to the State on the date the payment is due.

  (2) Except as provided in paragraph (3) of this subsection, the Comptroller or the Department may not require payment in funds that are immediately available to the State if the unpaid tax liability in connection with a tax return, report, or other document is less than $10,000.

  (3)

    (i) The Comptroller may require a person who is an agent of the payor or employer as defined in Sec. 10-905 of this article to make payments in immediately available funds on the date the payment is due by the employer or payor if the total amount of the payments to be made by the agent for any pay period exceeds $10,000 in the aggregate.

    (ii) Any amounts for which an agent has not received timely payment from an employer or payor:

      (1) shall be excluded for purposes of determining whether the total amount of payments to be made by an agent for a pay period exceeds $10,000 in the aggregate; and

      (2) may not be required to be paid in immediately available funds under this paragraph.

    (iii) This paragraph does not impose or affect liability for the payment of any tax.

(b) Any regulations adopted by the Comptroller or the Department under this section shall establish a suitable means for payment in immediately available funds so as to insure the availability of those funds to the State on the date of payment.

(c)

  (1) Subject to paragraphs (2) and (3) of this subsection, if a person fails to pay a tax imposed under this article on or before the date the tax is due in immediately available funds as required by the regulations of the Comptroller or the Department, the Comptroller or the Department shall assess interest and a penalty on the unpaid tax from the date the tax is due to the date on which the funds from the tax payment become available to the State.

  (2) The Comptroller or the Department may waive interest and penalties on late payments if the person required to pay the tax proves that:

    (i) the person made a good faith effort to comply with the requirements of this section; and

    (ii) the person exercised due diligence to initiate payment correctly and on a timely basis.

  (3)

    (i) Any interest or penalty assessed under this section due to an agent's failure to make payment in immediately available funds as required under subsection (a)(3) of this section:

      (1) shall be assessed against and paid by the agent; and

      (2) is not the responsibility of the payor or employer.

    (ii) This paragraph does not prevent assessment of interest and penalty against a payor or employer that is required to make payment in immediately available funds without regard to subsection (a)(3) of this section.

(d) This section does not affect any requirement otherwise established by law for the filing of any return, report, or other document.

#### Section 13-105

Subject to the approval of the Treasurer, the Comptroller by regulation may provide for payment in funds that are immediately available to the State of any delinquent unpaid tax liability for:

(1) income tax withheld by an employer;

(2) income tax from a corporation; or

(3) sales and use tax.

### Subtitle 1A. Private Letter Rulings

#### Section 13-1A-01

In this subtitle, "private letter ruling" means a written determination issued by the Comptroller on the application of tax laws and regulations under this article to a specific set of facts that is intended to apply only to that specific set of facts.

#### Section 13-1A-02

(a)

  (1) Except as provided in subsection (c) of this section, the Comptroller shall issue a private letter ruling on the written request of a person as soon as practicable after the date on which the Comptroller received the written request.

  (2)

    (i) A person requesting a private letter ruling shall include in the written request a statement as to whether the person is the subject of an ongoing taxation matter, including an audit, a claim for refund, a tax protest, or an appeal to the Tax Court or any other court with jurisdiction over the matter.

    (ii) If the person is the subject of an ongoing taxation matter, the statement required under this paragraph shall include any relevant case numbers or other identifying information.

(b)

  (1) The Comptroller, as appropriate, may request additional information from the person requesting the private letter ruling.

  (2) The person shall submit the information to the Comptroller within 30 days after the date on which the person receives the Comptroller's request under this subsection.

(c)

  (1) The Comptroller may deny a request for a private letter ruling for good cause, including:

    (i) the issue is the subject of existing guidance to taxpayers published by the Comptroller;

    (ii) the person did not timely submit the additional information requested by the Comptroller in accordance with subsection (b) of this section;

    (iii) the issue identified in the request:

      (1) is under extensive study or review; or

      (2) is currently being considered in a rulemaking procedure, contested case, or any other agency or judicial proceeding that may resolve the issue;

    (iv) the request involves a hypothetical situation or alternative plans;

    (v) the transaction for which the private letter ruling is requested is designed to avoid taxation;

    (vi) the facts or issues identified in the request are unclear, overbroad, insufficient, or otherwise inappropriate as a basis on which to issue a private letter ruling;

    (vii) the request is to determine whether a statute is constitutional under the Maryland Constitution or the United States Constitution;

    (viii) the issue is clearly and adequately addressed by statute, regulation, or court decision; or

    (ix) the issue involves the tax consequence of any proposed but not yet enacted federal, state, or local legislation.

  (2) If the Comptroller denies a request for a private letter ruling under this section, the Comptroller shall notify the person in writing:

    (i) of the reasons for the denial and why those reasons constitute good cause; and

    (ii) within 60 days after the date on which the request was submitted to the Comptroller.

(d) A person may withdraw, in writing, the request for a private letter ruling at any time before the issuance of the private letter ruling under this section.

#### Section 13-1A-03

(a) A private letter ruling issued under this subtitle may be relied on solely and prospectively by the person for whom the private letter ruling is requested unless there is an intervening statutory or regulatory change or the private letter ruling is revoked by the Comptroller.

(b) A private letter ruling is binding on the Comptroller for a period of 7 years unless:

  (1) there has been a misstatement or omission of material facts in the request;

  (2) the actual facts are determined to be materially different from the facts on which the private letter ruling was based;

  (3) there has been a change in law or a final decision in a contested case that the Comptroller determines affects the validity of the private letter ruling; or

  (4) the Comptroller has modified or revoked the private letter ruling.

(c) An unfavorable private letter ruling does not bind the person for whom the private letter ruling was requested.

(d) The modification or revocation of a private letter ruling by the Comptroller may not be applied retroactively to taxable periods or taxable years before the effective date of the modification or revocation.

#### Section 13-1A-04

(a) Subject to subsection (b) of this section, the Comptroller shall publish periodically on the Comptroller's website copies of private letter rulings that the Comptroller determines to be of interest to the general public.

(b) The Comptroller shall redact personally identifiable information in a published private letter ruling in order to ensure the confidentiality of any person that is the subject of the private letter ruling.

#### Section 13-1A-05

The Comptroller shall adopt regulations necessary to carry out the provisions of this subtitle, including regulations that establish:

(1) the procedure, form, and time periods for submitting a request for a private letter ruling;

(2) the terms and conditions under which a private letter ruling may be revoked or modified;

(3) the limitations on the applicability of a private letter ruling to specific persons, transactions, factual circumstances, and time periods;

(4) the circumstances under which a request for a private letter ruling may be denied by the Comptroller for good cause; and

(5) guidelines for the publication of private letter rulings.

### Subtitle 2. Confidentiality

#### Section 13-201

In this subtitle, "tax information" means:

(1) any tax return, information return, declaration of estimated tax, extension of time to file a return, or claim for refund under this article that is filed with the tax collector by, on behalf of, or with respect to any person and any amendment or supplement thereto, including supporting schedules, attachments, or lists that are supplemental to or a part of the return;

(2) the amount of income or any other particulars disclosed in a tax return required under this article, if the return contains return information, as defined in Sec. 6103 of the Internal Revenue Code;

(3) any return or return information, as defined in Sec. 6103 of the Internal Revenue Code, required to be attached to or included in a tax return required under this article; or

(4) any information contained in:

  (i) an admissions and amusement tax return;

  (ii) an alcoholic beverage tax return;

  (iii) a bay restoration fee return;

  (iv) a boxing and wrestling tax return;

  (v) a digital advertising gross revenues tax return;

  (vi) an E-9-1-1 fee return;

  (vii) a financial institution franchise tax return;

  (viii) an inheritance tax return;

  (ix) a Maryland estate tax return;

  (x) a motor carrier tax return;

  (xi) a motor fuel tax return;

  (xii) a new tire fee return;

  (xiii) an other tobacco products tax return;

  (xiv) a public service company franchise tax return;

  (xv) a sales and use tax return;

  (xvi) a savings and loan association franchise tax return;

  (xvii) a tire recycling fee return;

  (xviii) a tobacco tax return; or

  (xix) a transportation services assessment return.

#### Section 13-202

Except as otherwise provided in this subtitle, an officer, employee, former officer, or former employee of the State or of a political subdivision of the State may not disclose, in any manner, any tax information.

#### Section 13-203

(a)

  (1) In this subsection, "taxing official" means:

    (i) a unit or official of another state whom the laws of that state charge with the imposition, assessment, or collection of state taxes;

    (ii) an employee of the United States Treasury Department;

    (iii) a collector of United States taxes; or

    (iv) a United States Department of Justice attorney, including a United States Attorney.

  (2) The Comptroller or Department may disclose to a taxing official tax information that is contained in any tax report or return, audit of a tax return, or report of a tax investigation and relates to the imposition, assessment, and collection of taxes or to any other matter about taxation generally if:

    (i) the Comptroller or Department is satisfied that the tax information is to be used only for tax purposes;

    (ii) the taxing official's jurisdiction makes similar information available to the appropriate officials of this State; and

    (iii) in the case of another state, its laws provide for adequate confidentiality of Maryland tax returns or other information.

(b) Tax information may be disclosed in accordance with a proper judicial order or a legislative order.

(c) Subject to subsections (f) and (g) of this section, tax information may be disclosed to:

  (1) an employee or officer of the State who, by reason of that employment or office, has the right to the tax information;

  (2) another tax collector;

  (3) the Maryland Tax Court;

  (4) a legal representative of the State, to review the tax information about a taxpayer:

    (i) who applies for review under this title;

    (ii) who appeals from a determination under this title; or

    (iii) against whom an action to recover tax or a penalty is pending or will be initiated under this title;

  (5) any license issuing authority of the State required by State law to verify through the Comptroller that an applicant has paid all undisputed taxes and unemployment insurance contributions payable to the Comptroller or the Secretary of Labor or that the applicant has provided for payment in a manner satisfactory to the unit responsible for collection;

  (6) a local official as defined in Sec. 13-925 of this title to the extent necessary to administer Subtitle 9, Part V of this title;

  (7) a federal official as defined in Sec. 13-930 of this title to the extent necessary to administer Subtitle 9, Part VI of this title;

  (8) the Maryland Department of Health in accordance with the federal Children's Health Insurance Program Reauthorization Act of 2009;

  (9) the State Board of Individual Tax Preparers;

  (10) the Alcohol, Tobacco, and Cannabis Commission;

  (11) the Maryland 9-1-1 Board;

  (12) a person or governmental entity authorized by the Comptroller in writing to receive tax information for the purpose of identifying, preventing, or responding to fraud, provided that the tax information is:

    (i) anonymized to the extent possible consistent with the information's intended use; and

    (ii) in addition to any other protections and safeguards under law, subject to any protections and safeguards set forth by the Comptroller in the written authorization;

  (13) the Maryland Higher Education Commission;

  (14) subject to subsection (e) of this section, the Maryland Small Business Retirement Savings Board and its authorized contractors for the purpose of administering the Maryland Small Business Retirement Savings Program and Trust as authorized under Title 12 of the Labor and Employment Article;

  (15) the Maryland Department of Labor and the Maryland Department of Commerce to the extent necessary to:

    (i) administer the temporary relief programs established under Chapters 2 and 3 of the Acts of the General Assembly of 2024; or

    (ii) detect and prevent fraudulent claims for relief or avoidance of required repayment under the temporary relief programs;

  (16) the Maryland Cannabis Administration;

  (17) a person, governmental entity, or tax compliance organization for the purpose of assisting the Comptroller in tax compliance activity; and

  (18) the Maryland Department of Labor to the extent necessary to:

    (i) administer the Federal Government Employee Assistance Loan Fund under Sec. 7-327 of the State Finance and Procurement Article; or

    (ii) detect and prevent fraudulent claims for relief or avoidance of repayment required under Sec. 7-327 of the State Finance and Procurement Article.

(d) Tax information may be disclosed and published as statistics that are classified in a manner that prevents the identification of a particular return and the information contained in a particular return.

(e) Tax information disclosed in accordance with subsection (c)(14) of this section:

  (1) shall include only the following tax information of business entities:

    (i) the business entity's federal employer identification number;

    (ii) the name of the business entity;

    (iii) the physical address of the business entity;

    (iv) the mailing address of the business entity; and

    (v) the business entity's contact name, e-mail address, and phone number;

  (2) shall only be disclosed to the extent that the Comptroller has received the requested information from State tax filings;

  (3) need not be validated by the Comptroller prior to disclosure to the Maryland Small Business Retirement Savings Board and its authorized contractors;

  (4) may not include any information the Comptroller is prohibited from disclosing or redisclosing under federal law;

  (5) may not include tax information of individuals;

  (6) may be used only for the specific purpose authorized by the Comptroller; and

  (7) in addition to any other protections and safeguards under law, shall be subject to any protections and safeguards set forth by the Comptroller in the written authorization.

(f) Except as provided in subsection (g) of this section, before disclosing confidential tax information under subsection (c) of this section, the Comptroller may, in its sole discretion, require the person or governmental entity to whom the information is to be disclosed to enter into a binding, written agreement regarding the use and security of the tax information, the terms of which shall be prescribed by the Comptroller according to the Comptroller's data security policies and be consistent with State and federal requirements.

(g)

  (1) Before disclosing tax information under subsection (c)(9), (12), (14), (15), (16), or (17) of this section, the Comptroller shall require the party to whom the tax information is to be disclosed to enter into a binding, written agreement regarding the use and security of the tax information, the terms of which shall be:

    (i) prescribed by the Comptroller according to the Comptroller's data security policies;

    (ii) consistent with State and federal requirements, including Sec. 6103(a) of the Internal Revenue Code; and

    (iii) in compliance with Sec. 6103(b)(5)(B)(iii) of the Internal Revenue Code, by substituting "Comptroller" for "Secretary".

  (2) The Comptroller shall adequately supervise the recipient of the tax information under subsection (c)(9), (12), (14), (15), or (17) of this section at all times.

#### Section 13-204

In addition to a disclosure allowed under Sec. 13-203 of this subtitle, the Comptroller shall allow:

(1) the treasurer or finance officer of a county or municipal corporation to inspect the admissions and amusement tax return of a business, including a governmental unit, located in the county or municipal corporation; and

(2) the Maryland Stadium Authority to inspect an admissions and amusement tax return that relates to admissions to a facility owned or leased by the Authority.

#### Section 13-205

(a) In this section, "taxpayer identity information" means a taxpayer's:

  (1) name;

  (2) address; and

  (3) identifying number, as described in Sec. 6109 of the Internal Revenue Code.

(b)

  (1) In addition to a disclosure allowed in Sec. 13-203 of this subtitle, the Comptroller may disclose taxpayer identity information that relates to the taxes administered by the Comptroller under Sec. 2-102 of this article:

    (i) on written request of the administrator of the Central Collection Unit for taxpayer identity information, to the administrator or other employer or agent of the Unit but only for purposes of collection of a debt that the taxpayer owes to the State;

    (ii) to 1 or more commercial printers for the purpose of printing the taxpayer identity information on tax forms;

    (iii) to 1 or more commercial entities for the purpose of using a lockbox or similar system for tax forms and payments;

    (iv) in lists of names of persons who have failed to pay the tax as required in this article and other relevant information that the Comptroller determines may help in the collection of unpaid tax; and

    (v) except for the identifying numbers described in subsection (a)(3) of this section, to:

      (1) 1 or more persons with whom the Comptroller has contracted to obtain telephone numbers of taxpayers for use in the collection of unpaid tax; or

      (2) the press or other medium for the purpose of notifying persons entitled to tax refunds if, after reasonable effort and time, the Comptroller has been unable to locate those persons.

  (2) If the Comptroller discloses taxpayer identity information to a person under a contract described in paragraph (1)(v)1 of this subsection, the person:

    (i) shall use that information only to obtain telephone numbers for the Comptroller; and

    (ii) may not use any telephone number or taxpayer identity information or disclose the information to any other person.

#### Section 13-206

In addition to a disclosure allowed under Sec. 13-203 of this subtitle, the Comptroller may make an agreement with the appropriate authority of any other state that has laws similar to the motor carrier tax laws for cooperative audits of motor carrier tax returns and reports.

#### Section 13-207

(a) In this section, "income tax return preparer" means a person who:

  (1) prepares or helps to prepare federal or State income tax returns for compensation; or

  (2) advertises or publicizes that the person prepares or helps to prepare federal or State income tax returns.

(b) An income tax return preparer may not disclose any information that the preparer obtains while preparing or helping to prepare a return, unless the disclosure is:

  (1) based on the written consent of the taxpayer;

  (2) authorized expressly by a law of this State or the federal government;

  (3) needed to prepare the return; or

  (4) required by a court order.

#### Section 13-208

An officer, employee, former officer, or former employee of a person, governmental entity, or tax compliance organization to which tax information has been disclosed under Sec. 13-203(c)(18) of this subtitle may not disclose, in any manner, any tax information obtained in accordance with the data use agreement, unless the disclosure is:

(1) authorized expressly by a law of this State or the federal government;

(2) authorized by the data use agreement; or

(3) required by a court order.

### Subtitle 3. Determination of Tax and Enforcement

#### Section 13-301

A tax collector may examine or audit a tax return filed with the tax collector.

#### Section 13-302

(a) To determine whether a tax return is correct or otherwise to enforce a provision of this article, a tax collector may:

  (1) examine any records or other data that may be relevant or material to the matters required to be included in a tax return;

  (2) conduct an investigation;

  (3) hold a hearing;

  (4) administer oaths;

  (5) take testimony and other evidence; and

  (6) subpoena:

    (i) any person; or

    (ii) any relevant document.

(b) If the Comptroller determines that the taxpayer's records are so detailed, complex, or voluminous that an audit of all detailed records would be unreasonable or impractical, the Comptroller may compute the sales and use tax by using scientific random sampling techniques.

(c) If a person fails to comply with a subpoena or fails to testify on any matter on which the person lawfully may be interrogated, on petition of a tax collector, a circuit court or, if the subpoena is issued under authority of an orphans' court, the orphans' court may pass an order directing compliance with the subpoena or compelling testimony.

#### Section 13-303

If a person or governmental unit fails to file a tax return as required under this article, the tax collector shall mail the person or governmental unit a notice and demand for the return that requires the person or governmental unit:

(1) for the sales and use tax, to file the return and to pay the tax within 10 days after the date on which the notice is mailed; and

(2) for any other tax, to file the return and to pay the tax within 30 days after the date on which the notice is mailed.

#### Section 13-304

If a person fails to comply with a notice and demand for a return the tax collector:

(1) may compel the person to make the return; and

(2) if the person fails to make the return, may file an appropriate action in a court of competent jurisdiction.

### Subtitle 4. Assessments

#### Section 13-401

(a) Except as provided in subsection (b) of this section, if a tax collector examines or audits a return and determines that the tax due exceeds the amount shown on the return, the tax collector shall assess the deficiency.

(b) A tax collector shall allow a credit against any sales and use tax deficiency that would otherwise be assessed for any amount of sales and use tax that the tax collector determines the person who filed the return overpaid on or before the date the deficiency was due.

#### Section 13-402

(a) If a notice and demand for a return is made under Sec. 13-303 of this title and the person or governmental unit fails to file the return, the tax collector shall:

  (1) except as otherwise provided in this section:

    (i) compute the tax by using the best information in the possession of the tax collector; and

    (ii) assess the tax due;

  (2) for financial institution franchise tax:

    (i) estimate net earnings by using the best information in the possession of the tax collector; and

    (ii) assess a tax not exceeding twice the tax due on the estimated net earnings;

  (3) for income tax:

    (i) estimate income by using the best information in the possession of the tax collector; and

    (ii) assess a tax not exceeding twice the tax due on the estimated income;

  (4) for motor carrier tax:

    (i) compute the tax by using a miles per gallon factor based on the use, in the State, of 40 gallons of motor fuel for each commercial motor vehicle in the person's fleet on each day during the period for which the return is not filed; and

    (ii) assess the tax due;

  (5) for public service company franchise tax:

    (i) estimate gross receipts from the best information in the possession of the tax collector; and

    (ii) assess the tax due on the estimated gross receipts; and

  (6) for digital advertising gross revenues tax:

    (i) estimate gross revenues from the best information in possession of the tax collector; and

    (ii) assess the tax due on the estimated assessable base.

(b) A credit shall be allowed against any sales and use tax that would otherwise be assessed under this section for any amount of sales and use tax that the tax collector determines the person who failed to file the return overpaid on or before the date the amount assessed was due.

#### Section 13-403

(a) If a person or governmental unit fails to keep the records required under Sec. 4-202 of this article, the Comptroller may:

  (1) compute the admissions and amusement tax by using a factor that the Comptroller develops pursuant to subsection (c) of this section; and

  (2) assess the tax due.

(b) If a person or governmental unit fails to keep the records required under Sec. 6-202 of this article, the Comptroller may:

  (1) compute the boxing and wrestling tax by using a factor that the Comptroller develops pursuant to subsection (c) of this section; and

  (2) assess the tax.

(c) The factor utilized by the Comptroller pursuant to this section shall be developed by:

  (1) a survey of the business of the person or governmental unit, including any available records;

  (2) a survey of other persons or governmental units engaged in the same or similar business; or

  (3) other means.

#### Section 13-405

(a) If a person keeps records that do not contain the information required in Sec. 9-209 of this article, the Comptroller may:

  (1) compute the motor carrier tax by using a miles per gallon factor based on the best information in the possession of the Comptroller; and

  (2) assess the tax due.

(b) If a person fails to keep records or to make records available to the Comptroller as required in Sec. 9-209 of this article, the Comptroller shall:

  (1) compute the motor carrier tax by using a miles per gallon factor based on the use, in the State, of 40 gallons of motor fuel for each commercial motor vehicle in the person's fleet on each day during the period for which the records are not kept or made available; and

  (2) assess the tax due.

#### Section 13-406

If a person fails to keep the records required under Sec. 9-309 of this article, the Comptroller may:

(1) compute the motor fuel tax due by using the best information in the possession of the Comptroller; and

(2) assess the tax due.

#### Section 13-407

(a) If a person or governmental unit fails to keep the records required under Sec. 11-504 of this article, the Comptroller may:

  (1) compute the sales and use tax by using a factor that the Comptroller develops by:

    (i) a survey of the business of the person or governmental unit, including any available records;

    (ii) a survey of other persons or governmental units engaged in the same or similar business; or

    (iii) other means; and

  (2) assess the tax due.

(b)

  (1) If a person or governmental unit fails to obtain a proper resale certificate on or before the date stated in a notice of intent to assess the sales and use tax under Sec. 11-408(b) of this article, the Comptroller may assess the sales and use tax on the sale.

  (2) An assessment under this subsection is final.

#### Section 13-408

(a) If the Comptroller determines that a person has failed to keep the records of out-of-state cigarette or other tobacco product sales required under Sec. 12-203 of this article, the Comptroller shall:

  (1) compute the tobacco tax as if the cigarettes or other tobacco products were sold in the State; and

  (2) assess the tax due.

(b) If the Comptroller determines that a person has possessed or transported cigarettes or other tobacco products on which the tobacco tax has not been paid as required under Title 12 of this article, the Comptroller shall assess the tobacco tax due.

#### Section 13-409

(a) If the Internal Revenue Service issues a final determination that increases federal taxable income, federal estate, or federal generation-skipping transfer tax reported on a federal return, the tax collector shall assess the financial institution franchise tax, public service company franchise tax, income tax, Maryland estate tax, or Maryland generation-skipping transfer tax on the increase in the taxable net earnings, gross receipts, Maryland taxable income, federal credit for State death tax, or federal credit for State generation-skipping transfer tax that results from the federal adjustment.

(b) Within 90 days after the Internal Revenue Service issues to a person the final determination to which subsection (a) of this section refers, the person shall submit to the tax collector a report of federal adjustment that includes:

  (1) a statement of the amount of the increase; and

  (2) if the person contends that the final federal determination is erroneous, an explanation of the reasons for the contention.

#### Section 13-410

A tax collector shall mail a notice of assessment under this title to the person or governmental unit against which an assessment is made.

#### Section 13-411

An assessment of tax under this article is prima facie correct.

#### Section 13-412

If both the seller and buyer are liable for payment of the motor fuel tax or the sales and use tax:

(1) the Comptroller may make an assessment against both; and

(2) the assessment under item (1) of this section against either the seller or buyer does not bar an assessment against the other for the same tax or any part that has not been paid.

#### Section 13-413

(a) Interest, penalties, and collection fees shall be assessed and collected in the same manner as a tax.

(b) For purposes of this title, collection fees assessed pursuant to Sec. 13-832 of this title shall be considered a penalty.

### Subtitle 5. Appeals and Judicial Procedures Generally

#### Section 13-501

(a) In this subtitle the following words have the meanings indicated.

(b) "Tax Court" means the Maryland Tax Court.

(c)

  (1) "Tax determining agency" means a governmental unit of the State that is authorized to make the final decision or determination or issue the final order about a tax issue within the jurisdiction of the Tax Court, before the decision may be appealed to the Tax Court.

  (2) "Tax determining agency" includes a property tax assessment appeal board.

#### Section 13-504

(a) In this section, "state tax":

  (1) means a tax that is lawfully imposed by another state and is similar to a tax imposed under this article; and

  (2) includes interest and penalties on the tax.

(b) A court of this State shall recognize and enforce the liability for a state tax if the state that imposes the tax similarly recognizes and enforces the liability for a tax that this State lawfully imposes.

(c)

  (1) An official of a reciprocating state may bring an action in a court of this State to collect state taxes.

  (2) Certification, by the Secretary of State or other comparable official of another state, that an official has authority to collect state taxes is conclusive proof of that authority.

#### Section 13-505

A court may not issue an injunction, writ of mandamus, or other process against the State or any officer or employee of the State to enjoin or prevent the assessment or collection of a tax under this article.

#### Section 13-508

(a) Within 30 days after the date on which a notice of assessment of the admissions and amusement tax, alcoholic beverage tax, boxing and wrestling tax, digital advertising gross revenues tax, income tax, motor carrier tax, motor fuel tax, public service company franchise tax, financial institution franchise tax, sales and use tax, or tobacco tax is mailed, a person or governmental unit against which the assessment is made may submit to the tax collector:

  (1) an application for revision of the assessment; or

  (2) except for the public service company franchise tax, if the assessment is paid, a claim for refund.

(b) If a person or governmental unit fails to submit an application for revision or claim for refund within the time allowed in subsection (a) of this section, the assessment becomes final.

(c) The Comptroller or an employee of the Comptroller's office expressly designated by the Comptroller promptly:

  (1)

    (i) shall hold an informal hearing on a person's or governmental unit's admissions and amusement tax, alcoholic beverage tax, boxing and wrestling tax, digital advertising gross revenues tax, income tax, motor carrier tax, motor fuel tax, sales and use tax, or tobacco tax application for revision or claim for refund under subsection (a) of this section; and

    (ii) after the hearing:

      (1) shall act on the application for revision; and

      (2) may assess any additional tax, penalty, and interest due; and

  (2) shall mail to the person or governmental unit a notice of final determination.

(d) The Department promptly:

  (1)

    (i) shall act on a person's public service company franchise tax or financial institution franchise tax application for revision under subsection (a) of this section; or

    (ii)

      (1) shall hold an informal hearing after giving reasonable notice to the person; and

      (2) after the hearing:

      (A) shall act on the application for revision; and

      (B) may assess any additional tax, penalty, and interest due; and

  (2) shall mail to the person a notice of final determination.

#### Section 13-509

(a) Notwithstanding a person's failure to file a timely application for revision or claim for refund of an assessment of the admissions and amusement tax, alcoholic beverage tax, boxing and wrestling tax, digital advertising gross revenues tax, income tax, motor carrier tax, motor fuel tax, sales and use tax, or tobacco tax under Sec. 13-508(a) of this subtitle, the Comptroller or the Comptroller's designee may issue an order decreasing or abating an assessment to correct an erroneous assessment.

(b) If action is taken under subsection (a) of this section, the order shall state clearly the reasons for decreasing or abating the assessment.

(c) Any order issued by the Comptroller under subsection (a) of this section shall be final and not subject to appeal.

(d) The Comptroller's refusal to enter an order under subsection (a) of this section shall be final and not subject to appeal.

#### Section 13-510

(a) Except as provided in subsection (b) of this section and subject to Sec. 13-514 of this subtitle, within 30 days after the date on which a notice is mailed, a person or governmental unit that is aggrieved by the action in the notice may appeal to the Tax Court from:

  (1) a final assessment of tax, interest, or penalty under this article;

  (2) a final determination on an application for revision or claim for refund under Sec. 13-508 of this subtitle;

  (3) an inheritance tax determination by a register or by an orphans' court other than a circuit court sitting as an orphans' court;

  (4) a denial of an alternative payment schedule for inheritance tax or Maryland estate tax;

  (5) a final determination on a claim for return of seized property under Sec. 13-839 or Sec. 13-840 of this title; or

  (6) a disallowance of a claim for refund under Sec. 13-904 of this title.

(b) If a tax collector does not make a determination on a claim for refund within 6 months after the claim is filed, the claimant may:

  (1) consider the claim as being disallowed; and

  (2) appeal the disallowance to the Tax Court.

(c) An appeal to the Maryland Tax Court under this section shall be deemed to be filed within the time allowed for the appeal if a written petition is mailed to the Maryland Tax Court with a postmark date within the time allowed for the appeal.

#### Section 13-511

A register, on behalf of the State, or a person in interest may appeal to the Court of Special Appeals from an order or determination of an orphans' court or a court exercising the jurisdiction of the orphans' court that relates to the inheritance tax.

#### Section 13-514

Unless a person has exhausted all available administrative remedies before the appropriate tax determining agency, the person may not appeal to the Tax Court.

#### Section 13-515

(a) An individual may appear before the Tax Court without a lawyer.

(b) The following individuals may represent the persons indicated without a lawyer before the Tax Court:

  (1) a partner for the partnership; and

  (2) a corporate officer for the corporation.

(c) Any person or governmental unit may be represented before the Tax Court by a lawyer who is admitted to practice law in the State.

#### Section 13-516

(a) To appeal to the Tax Court, a person or governmental unit shall file with the Tax Court a written petition that states succinctly:

  (1) the nature of the case;

  (2) the facts on which the appeal is based; and

  (3) each question presented for review by the Tax Court.

(b) An opposing party shall respond in accordance with the rules of procedure of the Tax Court.

#### Section 13-517

The Tax Court may require or, on request of a party, allow an amendment to a pleading or motion.

#### Section 13-518

The Tax Court may require or, on request of a party, allow a party to file a brief or memorandum.

#### Section 13-519

The Tax Court shall hear and determine appeals promptly.

#### Section 13-520

(a) On receipt of a petition, the clerk of the Tax Court immediately shall issue a subpoena that requires the appropriate tax determining agency to produce at a hearing before the Tax Court:

  (1) the record of the proceeding from which the appeal is taken or a certified copy of the record; and

  (2) any map, plat, or other document that is connected with the record.

(b) On request of a party, the Tax Court shall issue a subpoena that requires at a hearing before the Tax Court:

  (1) the appearance of a witness to testify; and

  (2) the production of any pertinent document.

(c) A subpoena issued under this section or Sec. 13-521 of this subtitle shall be served by:

  (1) the sheriff or deputy sheriff of the jurisdiction in which the person subpoenaed is found;

  (2) the clerk or a deputy clerk of the Tax Court;

  (3) certified mail, return receipt requested; or

  (4) a private process server.

#### Section 13-521

(a) A party may take a deposition in or out of the State in the manner provided by law for taking depositions in a civil case.

(b) On request of a party, the Tax Court shall issue a subpoena that requires at a deposition:

  (1) the appearance of a witness to testify; and

  (2) the production of any pertinent document.

#### Section 13-522

(a) If, without reasonable cause, a person fails to obey a subpoena, refuses to be sworn, or refuses to testify, the Tax Court may and, on request of a party, shall apply to a circuit court to issue an order, returnable within 5 days, that directs the person to show cause for the refusal to be sworn or to testify or the failure to obey the subpoena.

(b)

  (1) After the expiration of the time period in subsection (a) of this section, the circuit court shall conduct a hearing to determine the existence of reasonable cause.

  (2) If the circuit court determines that there is no reasonable cause for the failure to comply, the circuit court shall order compliance with the directive of the Tax Court.

(c) A person who fails to comply with the order of a circuit court may be held in contempt of court, and the circuit court shall impose sanctions appropriate for contempt.

(d) A person may appeal a finding of contempt under this section.

#### Section 13-523

An appeal before the Tax Court shall be heard de novo and conducted in a manner similar to a proceeding in a court of general jurisdiction sitting without a jury.

#### Section 13-524

The Tax Court is not bound by the technical rules of evidence.

#### Section 13-525

(a) A party may submit to the Tax Court a request for a ruling on a question of law that is material to the appeal.

(b) On a request submitted under subsection (a) of this section, the Tax Court may:

  (1) issue a ruling on the question of law;

  (2) modify the question submitted by a party and issue a ruling on the modified question; or

  (3) decline to issue a ruling.

#### Section 13-526

(a) Except as provided in subsection (c) of this section, on the request of a party, the Tax Court may submit an issue of fact to a circuit court for a jury trial.

(b) A submission under this section shall be filed in the circuit court for the county where the taxpayer resides or does business.

(c) An issue of fact as to the valuation of property may not be submitted under this section.

#### Section 13-527

(a) The Tax Court shall provide:

  (1) for recording equipment at all hearings; and

  (2) on request of a party, for the preparation of a copy of the record of the proceedings.

(b) If, under Sec. 3-111 of this article, the Tax Court appoints an examiner to hear an appeal, the Tax Court shall provide to each party a copy of the examiner's recommended decision.

#### Section 13-528

(a)

  (1) The Tax Court shall have full power to hear, try, determine, or remand any matter before it.

  (2) In exercising these powers, the Tax Court may reassess or reclassify, abate, modify, change or alter any valuation, assessment, classification, tax or final order appealed to the Tax Court.

(b) Absent affirmative evidence in support of the relief being sought or an error apparent on the face of the proceeding from which the appeal is taken, the decision, determination, or order from which the appeal is taken shall be affirmed.

#### Section 13-529

(a) In each appeal, the Tax Court shall issue a written order that sets forth its decision.

(b) Each order of the Tax Court shall be filed with its clerk.

(c) The clerk of the Tax Court shall certify the order in an appeal and mail a copy of the certified order to:

  (1) each party to the appeal; and

  (2) the tax determining agency from which the appeal is taken.

#### Section 13-532

(a)

  (1) A final order of the Tax Court is subject to judicial review as provided for contested cases in Sec.Sec. 10-222 and 10-223 of the State Government Article.

  (2) Any party to the Tax Court proceeding, including a governmental unit, may appeal a final order of the Tax Court to the circuit court.

(b) When an order of the Tax Court is subject to judicial review, that order is enforceable unless the reviewing court grants a stay upon such condition, security or bond as it deems proper.

### Subtitle 6. Interest

#### Section 13-601

(a) Except as otherwise provided in this section, if a person or governmental unit fails to pay a tax imposed under this article on or before the date on which the tax is due, the tax collector shall assess interest on the unpaid tax from the due date to the date on which the tax is paid.

(b) Except as provided in subsections (c)(2) and (d) of this section, the date on which the tax is due is determined without regard to any extension of time to file a return.

(c) Interest on unpaid inheritance tax begins:

  (1) 30 days after the date on which the tax is determined;

  (2) on the original due date, if there is no formal administration of the estate and the tax is not paid within 30 days after the date on which the tax bill is mailed; or

  (3) 30 days after the original due date, if an alternative payment schedule for inheritance tax is allowed.

(d) Interest on unpaid Maryland estate tax begins 9 months after the date of the death of a decedent and applies to all Maryland estate tax that is not paid by that date, including a payment made in accordance with an alternative payment schedule.

(e) Interest on unpaid Maryland generation-skipping transfer tax begins on the date the Maryland generation-skipping transfer tax return is due and applies to tax that is not paid by that date, including an increase in Maryland generation-skipping transfer tax due to a change in federal generation-skipping transfer tax made after a payment of Maryland generation-skipping transfer tax.

(f) An overpayment of sales and use tax stops the accrual of interest on a sales and use tax deficiency to the extent of the overpayment as of the date the overpayment is made.

#### Section 13-602

(a) Except as provided in subsections (b) and (c) of this section, a tax collector shall assess interest on unpaid tax from the due date to the date on which the tax is paid if a person who is required to estimate and pay digital advertising gross revenues tax, financial institution franchise tax, public service company franchise tax, or income tax under Sec. 7.5-301, Sec. 8-210(b), Sec. 8-405(b), or Sec. 10-902 of this article:

  (1) fails to pay an installment when due; or

  (2) estimates a tax that is:

    (i) less than 90% of the tax required to be shown on the return for the current taxable year; and

    (ii) less than 110% of the tax paid for the prior taxable year, reduced by the credit allowed under Sec. 10-703 of this article.

(b) Interest may not be assessed on the underestimation of individual income tax if:

  (1) at least 90% of the individual's taxable income is also taxable by another state; and

  (2) the underestimation is of the county income tax only.

(c) A tax collector may not assess interest on unpaid individual income tax under subsection (a) of this section if the amount of unpaid income tax is less than one-half the amount specified in Sec. 6654(e)(1) of the Internal Revenue Code.

#### Section 13-603

(a) Except as otherwise provided in this section, if a claim for refund under Sec. 13-901(a)(1) or (2) or (d)(1)(i) or (2) of this title is approved, the tax collector shall pay interest on the refund from the 45th day after the claim is filed in the manner required in Subtitle 9 of this title to the date on which the refund is paid.

(b) A tax collector may not pay interest on a refund if the claim for refund is:

  (1) made under any provision other than Sec. 13-901(a)(1) or (2) or (d)(1)(i) or (2) of this title;

  (2) based on:

    (i) an error or mistake of the claimant not attributable to the State or a unit of the State government;

    (ii) withholding excess income tax;

    (iii) an overpayment of estimated financial institution franchise tax or estimated income tax; or

    (iv) an overpayment of Maryland estate tax based on an inheritance tax payment made after payment of Maryland estate tax; or

  (3) made for Maryland estate tax or Maryland generation-skipping transfer tax more than 1 year after the event on which the claim is based.

#### Section 13-604

(a) The rate of interest for each month or fraction of a month is the percent equal to one-twelfth of the annual interest rate that the Comptroller sets for the calendar year under subsection (b) of this section.

(b) On or before October 1 of each year, the Comptroller shall set the annual interest rate for the next calendar year on refunds and money owed to the State as the percent that equals the greater of:

  (1)

    (i) 13% for 2016;

    (ii) 12% for 2017;

    (iii)

      (11) 5% for 2018;

    (iv) 11% for 2019;

    (v)

      (10) 5% for 2020;

    (vi) 10% for 2021;

    (vii)

      (9) 5% for 2022; and

    (viii) 9% for 2023 and each year thereafter; or

  (2) 3 percentage points above the average prime rate of interest quoted by commercial banks to large businesses during the State's previous fiscal year, based on determination by the Board of Governors of the Federal Reserve Bank.

#### Section 13-605

Interest may not be assessed on a penalty.

#### Section 13-606

(a) For reasonable cause, a tax collector may waive interest on unpaid tax.

(b) The Comptroller shall waive the amount of any interest assessed on unpaid income tax due under this article if:

  (1) the unpaid income tax is due for a taxable year during which the person owing is incarcerated; and

  (2) the person applies for and is placed on an installment payment plan under the Income Tax Reconciliation Program established under Sec. 2-120 of this article.

### Subtitle 7. Penalties

#### Section 13-701

(a) Except as otherwise provided in this subtitle, if a person or governmental unit fails to pay a tax when due under this article, the tax collector shall assess a penalty not exceeding 10% of the unpaid tax.

(b)

  (1) If a person fails to pay alcoholic beverage tax, financial institution franchise tax, or tobacco tax when required under this article, the tax collector shall assess a penalty not exceeding 25% of the unpaid tax.

  (2) If a person fails to file a motor carrier tax return or motor fuel tax return when required under this article, the Comptroller shall assess a penalty not exceeding $25.

(c) The penalty under subsection (a) of this section may be assessed for unpaid inheritance tax at or after the time allowed for the assessment of interest under Sec. 13-601(c) of this title.

#### Section 13-702

(a) Except as provided in subsections (b) and (c) of this section, a tax collector shall assess a penalty not exceeding 25% of the amount underestimated, if a person who is required to estimate and pay digital advertising gross revenues tax, financial institution franchise tax, public service company franchise tax, or income tax under Sec. 7.5-301, Sec. 8-210(b), Sec. 8-405(b), or Sec. 10-902 of this article:

  (1) fails to pay an installment when due; or

  (2) estimates a tax that is:

    (i) less than 90% of the tax required to be shown on the return for the current taxable year; and

    (ii) less than 110% of the tax paid for the prior taxable year, reduced by the credit allowed under Sec. 10-703 of this article.

(b) A penalty may not be assessed on the underestimation of individual income tax if:

  (1) at least 90% of the individual's taxable income is also taxable by another state; and

  (2) the underestimation is of the county income tax only.

(c) A tax collector may not assess a penalty on unpaid individual income tax under subsection (a) of this section if the amount of unpaid income tax is less than one-half the amount specified in Sec. 6654(e)(1) of the Internal Revenue Code.

#### Section 13-703

(a) If, with the intent to evade the payment of tax, a person, including an officer of a corporation, or a governmental unit makes a false tax return, the tax collector shall assess a penalty not exceeding 100% of the tax due.

(b) If, with the intent to evade the payment of tax, a person hired to prepare a tax return makes a false tax return, the tax collector shall assess the hired preparer a penalty not exceeding 100% of the tax due.

#### Section 13-704

If, with the intent to evade the payment of tax, a person or governmental unit fails to file a tax return when required under this article, the tax collector shall assess a penalty not exceeding 100% of the underpayment of tax.

#### Section 13-705

(a) The Comptroller shall assess a penalty not exceeding $500 if:

  (1) an individual, as defined under Sec. 10-101 of this article, files what purports to be an income tax return, but which:

    (i) does not contain information on which the substantial correctness of the tax may be determined; or

    (ii) contains information that, on its face, indicates the tax reported on the return is substantially incorrect; and

  (2) the conduct of the individual is due to:

    (i) a desire, apparent on the face of the return, to delay or impede the administration of the provisions of Title 10 of this article; or

    (ii) a position that is frivolous because the position:

      (1) has no basis in law or fact;

      (2) is patently unlawful; and

      (3) does not involve a legitimate dispute or reflect an inadvertent mathematical or clerical error.

(b) The penalty under subsection (a) of this section is in addition to any penalty assessed under Sec. 13-701 of this subtitle.

#### Section 13-706

If a person is required to provide an income tax withholding statement under Sec. 10-911 of this article, the Comptroller shall assess a penalty of $50 for each violation, if the person willfully:

(1) fails to provide a required withholding statement; or

(2) provides a false withholding statement.

#### Section 13-706.1

If a person is required to provide an annual withholding reconciliation report under Sec. 10-911 of this article, the Comptroller shall assess a penalty of $100 for each violation if the person willfully:

(1) fails to provide a required annual withholding reconciliation report; or

(2) provides a false annual withholding reconciliation report.

#### Section 13-707

(a) If an employer or payor, as defined in Sec. 10-905 of this article, willfully fails to withhold or pay over the income tax as required in Title 10 of this article, the Comptroller may suspend or revoke any business license issued by the State to the employer or payor.

(b) If a motor carrier fails to file a motor carrier tax return or pay the motor carrier tax when required under Title 9, Subtitle 2 of this article, the Comptroller may suspend or revoke any identification marker, permit, or temporary authorization issued to the motor carrier under Title 9, Subtitle 2 of this article.

(c) If a motor carrier fails to pay a tax, a fee, a penalty, or an interest assessment owed to the Maryland Motor Vehicle Administration, the Comptroller shall, upon receipt of notification from the Motor Vehicle Administration, suspend or revoke the appropriate identification marker, permit, or temporary authorization issued to the motor carrier under Title 9, Subtitle 2 of this article.

#### Section 13-708

(a) If, within the period required in a notice and demand for a return, a person or governmental unit fails to file the return and pay the tax due, the tax collector shall assess a penalty of 25% of the tax assessed under Sec. 13-402 of this title.

(b) A penalty under this section is in addition to the penalty provided under Sec. 13-701 of this subtitle.

#### Section 13-709

(a) If, within 10 days after receipt of a notice and demand for payment of a sales and use tax assessment that is final, a person or governmental unit fails to comply with the demand, the Comptroller shall assess a penalty of 25% of the unpaid assessment.

(b) The penalty under subsection (a) of this section is in addition to the penalty provided under Sec. 13-701 of this subtitle.

#### Section 13-710

If the Comptroller, the Executive Director, or any police officer seizes distilled spirits or mash in connection with an arrest of a person for the unlawful manufacture of distilled spirits in the State, on conviction of the person, the Comptroller shall assess a penalty of $5 for each 100 proof gallon on:

(1) all distilled spirits seized; or

(2) the potential quantity of distilled spirits that may be manufactured from the quantity of mash seized.

#### Section 13-711

If a person willfully fails to keep any record required under Sec. 12-203 of this article, the Comptroller may assess a penalty not exceeding 25% of the unpaid tobacco tax.

#### Section 13-712

If, with the intent to evade the boxing and wrestling tax, a person sells a program or other item instead of an admission ticket, the person shall forfeit any license granted to the person under Title 4, Subtitle 3 of the Business Regulation Article.

#### Section 13-713

(a) If a person pays a tax, interest, or penalties under this article by a check that is not honored by the bank on which it is drawn, the tax collector shall assess a service charge of $30 against the person.

(b) An assessment under subsection (a) of this section that is not paid within 25 days after the date on which the notice of assessment is mailed is a lien, in favor of the State, that:

  (1) extends to all property and rights to property belonging to the person against whom the assessment is made; and

  (2) may be collected under Subtitle 8, Part II of this title.

#### Section 13-714

(a) For reasonable cause, a tax collector may waive a penalty under this subtitle.

(b) The Comptroller shall waive any penalty under this subtitle for a person's failure to pay income tax when due under this article if:

  (1) the unpaid income tax is due for a taxable year during which the person owing is incarcerated; and

  (2) the person applies for and is placed on an installment payment plan under the Income Tax Reconciliation Program established under Sec. 2-120 of this article.

#### Section 13-715

(a)

  (1) Subject to the provisions of paragraph (2) of this subsection, any person who is an income tax return preparer with respect to any return or claim for refund, who is required under Sec. 10-804(b)(2) of this article to sign the return or claim for refund, and who fails to comply with that requirement with respect to the return or claim for refund shall pay a penalty of $50 for that failure, unless it is shown that the failure is due to reasonable cause and not due to willful neglect.

  (2) The maximum penalty imposed under this subsection on any person with respect to documents filed during any calendar year may not exceed $25,000.

(b)

  (1) Subject to the provisions of paragraph (2) of this subsection, any person who is an income tax return preparer with respect to any return or claim for refund and who fails to comply with Sec. 10-804(c)(3) of this article with respect to the return or claim for refund shall pay a penalty of $50 for that failure, unless it is shown that the failure is due to reasonable cause and not due to willful neglect.

  (2) The maximum penalty imposed under this subsection on any person with respect to documents filed during any calendar year may not exceed $25,000.

(c)

  (1) The Attorney General may bring an action in the name of the State or the Comptroller to enjoin a person from acting as an income tax return preparer as defined in Sec. 7701 of the Internal Revenue Code.

  (2) A court may enjoin a person from acting as an income tax return preparer if the court determines:

    (i) that the income tax return preparer:

      (1) failed to comply with Sec. 10-804(b)(2) or (c)(3) of this article;

      (2) misrepresented the income tax return preparer's experience, education, or registration as an income tax return preparer;

      (3) guaranteed the payment of a tax refund or a tax credit; or

      (4) engaged in any other fraudulent or deceptive conduct that substantially interferes with the proper administration of this article; and

    (ii) that injunctive relief is appropriate to prevent the recurrence of the conduct specified in this paragraph.

  (3) The Attorney General shall bring the action in the county where the defendant:

    (i) resides; or

    (ii) engages in the practice of income tax return preparation.

#### Section 13-716

(a) The Comptroller shall assess a penalty of 25% of the amount of the underpayment of tax which is attributable to any substantial estate tax valuation understatement.

(b) For purposes of this section, there is a substantial estate tax valuation understatement if the value of any property claimed, or that should have been claimed, on any return of tax imposed by Title 7, Subtitle 3 of this article is 60% or less of the amount determined to be the correct amount of that valuation.

(c) A penalty may not be imposed under subsection (a) of this section unless the portion of the underpayment attributable to substantial estate tax valuation understatement is greater than $5,000.

#### Section 13-717

(a) An income tax return preparer who is subject to Sec. 10-824 of this article and who fails to file a return as required in Sec. 10-824 of this article shall pay a penalty of $50 for that failure, unless it is shown that the failure is due to reasonable cause and is not due to willful neglect.

(b) The total amount of the penalties assessed under subsection (a) of this section may not exceed $500 for all returns filed by an income tax return preparer for any taxable year.

### Subtitle 8. Collections

#### Section 13-801

(a) Unpaid tax, interest, and penalties shall be first paid and satisfied from the proceeds of a sale of any property of a person liable for the tax.

(b) Notwithstanding subsection (a) of this section, a claim of a tax collector for unpaid tax, interest, and penalties shall be subordinate:

  (1) to the claim of any purchaser, holder of a security interest, or mechanic's lienor, as those terms are defined in Sec. 6323(h) of the Internal Revenue Code, or to the claim of a judgment creditor whose lien attached before the claim for unpaid tax, interest, and penalties; and

  (2) to any claim described in Sec. 6323(b), (c), or (d) of the Internal Revenue Code.

(c)

  (1) A judicial officer who makes a sale of property shall determine from a tax collector whether the owner of the property owes any tax, interest, or penalties.

  (2) The judicial officer is personally liable and the bond of the officer is liable for any tax, interest, or penalties not paid to the tax collector in violation of this section.

(d)

  (1) Whenever property is taken in execution of an action to collect taxes, the tax collector may bid for and buy the property for the use of the State if the tax collector believes the purchase is necessary and proper for the protection of the State.

  (2) A bid under paragraph (1) of this subsection may not exceed the claim of the State for unpaid taxes and the costs and expenses of the sale.

#### Section 13-802

If the transferee or auctioneer in a bulk transfer fails to file the notice required in Sec. 11-505 of this article or to retain consideration in an amount equal to the claim of the Comptroller for unpaid sales and use tax:

(1) any consideration in the bulk transfer is subject to a first priority right and lien for any sales and use tax that the transferor owes to the State; and

(2) the transferee or auctioneer is personally liable for the sales and use tax, interest and penalties that the transferor owes to the State.

#### Section 13-804

(a)

  (1) In this section the following words have the meanings indicated.

  (2)

    (i) "Account" means:

      (1) any funds from a demand deposit account, checking account, negotiable order of withdrawal account, savings account, time deposit account, money market mutual fund account, or certificate of deposit account;

      (2) any funds paid towards the purchase of shares or other interest in a financial institution, as defined in paragraph (4)(ii) and (iii) of this subsection; and

      (3) any funds or property held by a financial institution, as defined in paragraph (4)(iv) or (v) of this subsection.

    (ii) "Account" does not include:

      (1) an account or portion of an account to which an obligor does not have access due to the pledge of the funds as security for a loan or other obligation;

      (2) funds or property deposited to an account after the time that the financial institution initially attaches the account;

      (3) an account or portion of an account to which the financial institution has a present right to exercise a right of setoff;

      (4) an account or portion of an account that has an account holder of interest named as an owner on the account; or

      (5) an account or portion of an account to which the obligor does not have an unconditional right of access.

  (3) "Account holder of interest" means any person, other than the obligor, who asserts an ownership interest in an account.

  (4) "Financial institution" means:

    (i) a depository institution, as defined in the Federal Deposit Insurance Act under 12 U.S.C. Sec. 1813(c);

    (ii) a federal credit union or State credit union, as defined in the Federal Credit Union Act under 12 U.S.C. Sec. 1752;

    (iii) a State credit union regulated under Title 6 of the Financial Institutions Article;

    (iv) a virtual currency money transmitter that is regulated under Title 12 of the Financial Institutions Article; or

    (v) a benefit association, insurance company, safe deposit company, money market mutual fund, or similar entity doing business in the State that holds property or maintains accounts reflecting property belonging to others.

  (5) "Obligor" means a person whose property is subject to a tax lien.

(b) The Comptroller may request from a financial institution information and assistance to enable the Comptroller to enforce the tax laws of the State.

(c)

  (1) The Comptroller may request not more than four times a year from a financial institution the information set forth in subsection (d)(2) of this section concerning any obligor who is delinquent in the payment of taxes.

  (2) A request for information by the Comptroller under paragraph (1) of this subsection shall:

    (i) contain:

      (1) the full name of the obligor and any other names known to be used by the obligor; and

      (2) the Social Security number or other taxpayer identification number of the obligor; and

    (ii) be transmitted to the financial institution in an electronic format unless the financial institution specifically asks the Comptroller to submit the request in writing.

(d)

  (1) Within 30 days after a financial institution receives a request for information under subsection (c) of this section, the financial institution shall, with respect to each obligor whose name the Comptroller submitted to the financial institution, submit a report to the Comptroller.

  (2)

    (i) Except as provided in subparagraph (ii) of this paragraph, the report described in paragraph (1) of this subsection shall contain, to the extent reflected in the records of the financial institution:

      (1) the full name of the obligor;

      (2) the address of the obligor;

      (3) the Social Security number or other taxpayer identification number of the obligor;

      (4) any other identifying information needed to ensure positive identification of the obligor; and

      (5) for each account of the obligor, the obligor's account number and balance.

    (ii) For a financial institution that submits reports through the Federal Parent Locator Service under 42 U.S.C. Sec. 666(a)(17), the report described in paragraph (1) of this subsection may contain information that meets the specifications required for financial data match reports under the Federal Parent Locator Service.

  (3) A report submitted under paragraph (1) of this subsection shall be provided to the Comptroller in machine-readable form.

  (4) The Comptroller shall pay the financial institution a reasonable fee, not to exceed the actual costs incurred by the financial institution to comply with the requirements of this section, less any fees received from other units of the State for the same report.

  (5) The Comptroller may institute civil proceedings to enforce this section.

(e) A financial institution that complies with a request from the Comptroller by submitting a report to the Comptroller in accordance with subsection (d) of this section is not liable under State law to any person for any:

  (1) disclosure of information to the Comptroller under this section; or

  (2) other action taken in good faith to comply with the requirements of this section.

(f) A financial institution furnishing a report to the Comptroller under this section is prohibited from disclosing to an obligor that the name of that obligor has been received from or furnished to the Comptroller.

#### Section 13-805

(a) Unpaid tax, interest, and penalties constitute a lien, in favor of the State, extending to all property and rights to property belonging to:

  (1) the person required to pay the tax; or

  (2) the fiduciary estate on which the tax is imposed.

(b) Unpaid inheritance tax, interest, and penalties constitute a lien, in favor of the State, extending to:

  (1) the assets of a small business for which an alternative payment schedule was granted under Sec. 7-218 of this article; and

  (2) any other property on which inheritance tax is due.

(c) Unpaid Maryland estate tax and interest constitute a lien, in favor of the State, extending to the estate that is subject to the Maryland estate tax.

(d) Unpaid Maryland generation-skipping transfer tax and interest constitute a lien, in favor of the State, extending to any property included in the generation-skipping transfer for which the Maryland generation-skipping transfer tax is due.

#### Section 13-806

(a) Unless another date is specified by law and except for a lien under subsection (b) of this section, a lien arises on the date of notice that the tax is due and continues until the earlier of:

  (1) the date on which the lien is:

    (i) satisfied; or

    (ii) released by the tax collector because the lien is:

      (1) unenforceable by reason of lapse of time; or

      (2) uncollectible; or

  (2) 20 years after the date of assessment.

(b)

  (1) Except as otherwise provided in this subsection, a lien for unpaid inheritance tax:

    (i) arises on the date of distribution; and

    (ii) continues for 20 years.

  (2) If the property is subject to a special valuation under Sec. 7-211 of this article, a lien:

    (i) arises on the date on which the interest in the property vests in possession; and

    (ii) continues for 20 years.

  (3) If the unpaid inheritance tax is attributable to the disqualification of property that was qualified for special valuation or exemption under Sec. 7-211 of this article, the lien:

    (i) arises on the date on which the decedent died; and

    (ii) continues for 20 years.

#### Section 13-807

(a) A tax collector may file a notice of tax lien with the clerk of the circuit court for the county where the property that is subject to the lien is located.

(b)

  (1) On receipt of a notice of tax lien, the clerk of a circuit court promptly shall:

    (i) record and index the lien; and

    (ii) enter the lien in the judgment docket of the court.

  (2) The docket entry shall include:

    (i) the name of the person whose property is subject to the tax lien; and

    (ii) the amount and date of the tax lien.

#### Section 13-808

From the date on which a tax lien is filed under Sec. 13-807 of this subtitle, the lien has the full force and effect of a judgment lien.

#### Section 13-809

(a) A tax lien shall be first paid and satisfied from the proceeds of a sale of any property of a person liable for the tax.

(b)

  (1) Notwithstanding subsection (a) of this section, a tax lien is not valid against any purchaser, holder of a security interest, mechanic's lienor, or judgment lien creditor until notice of the tax lien has been filed under Sec. 13-807 of this subtitle.

  (2) Even if notice of a tax lien is filed, the lien is not valid against any claim described in Sec. 6323(b), (c), or (d) of the Internal Revenue Code.

(c) The rules and definitions in Sec. 6323(e), (h), and (i) of the Internal Revenue Code shall apply in construing this section.

#### Section 13-810

(a) If a tax lien is not satisfied or released on or before the 15th day after the notice of the lien is filed, recorded, and indexed under Sec. 13-807 of this subtitle, a qualified attorney who is a regular salaried employee of the Comptroller or, at the request of the tax collector, the Attorney General may bring an action in a court of the State to enforce the lien.

(b) The following persons shall be made parties to the proceeding:

  (1) each person who has a lien on the property that is sought to be subjected to the proceedings; and

  (2) each person who claims a right to or an interest in the property that is sought to be subjected to the proceedings.

(c) The court, acting without a jury, shall:

  (1) adjudicate all matters involved in the proceedings; and

  (2) determine the merits of all claims or liens.

(d) If the claim or interest of the State is established, the court may order:

  (1) a sale of the property or rights to property; and

  (2) a distribution of any proceeds of sale in accordance with the interests of the parties and the State.

#### Section 13-811

(a)

  (1) In this section the following words have the meanings indicated.

  (2) "Paymaster":

    (i) means an employer's officer, representative, agent, or employee charged with the duty of paying salary, wages, or other compensation for personal services to an employee named in a notice of lien; and

    (ii) if the person named in a notice of lien is employed by the federal government or its instrumentality with an office in the State where employee records are kept, whether or not payroll records are kept or the payroll is prepared at that office, includes the employee who:

      (1) is designated to keep and maintain employee records in that office; and

      (2) is or may be designated to receive and distribute pay checks to the employees.

  (3) "Tax wage lien" means the lien on wages described in this section.

(b) A tax lien for any tax administered by the Comptroller under this article extends to and covers all salary, wages, or other compensation for personal services that is due or becomes payable on or after the time the lien arises.

(c) The Comptroller promptly shall give notice of a tax wage lien that states the lien amount, the type of tax, and the name of the person against whom the lien is taken by:

  (1) certified mail, return receipt requested, under the postmark of the United States Postal Service, to the employer; or

  (2) personal service on the employer.

(d)

  (1) If an employer knows or has reason to know of the import of the contents of the certified mail and refuses to accept its delivery, service as required under subsection (c)(1) of this section is made when delivery is refused.

  (2) Service as required under subsection (c)(2) of this section is made when personal service is made on an officer or paymaster of the employer.

(e)

  (1) From salary, wages, or other compensation for personal services that is due or becomes payable on or after the date on which a notice of wage lien is served to the date on which a notice of satisfaction or release of the wage lien is received, an employer or paymaster promptly shall pay to the Comptroller any salary, wages, or other compensation due to the delinquent taxpayer, excluding only those amounts specified in paragraph (2) of this subsection.

  (2) The amount excluded under paragraph (1) of this subsection from amounts paid to the delinquent taxpayer is the amount exempt from attachment provided in Sec. 15-601.1 of the Commercial Law Article.

(f) The Comptroller promptly shall give a notice of satisfaction or release of a tax wage lien to each employer or paymaster who received notice of the wage lien.

(g) If, after service of a notice of a tax wage lien, an employer or paymaster pays an employee salary, wages, or other compensation for personal services in excess of the amount allowed in subsection (e)(2) of this section, the employer or paymaster or both shall be personally liable for the excess amount paid to the employee. However, the total amount that the Comptroller recovers may not exceed the total amount paid to the employee in violation of this section.

#### Section 13-812

(a)

  (1) In this section the following words have the meanings indicated.

  (2) "Account", "account holder of interest", and "financial institution" have the meanings stated in Sec. 13-804 of this subtitle.

  (3) "Obligor" means a person whose property is subject to a tax lien.

(b)

  (1)

    (i) The Comptroller may send notice of a tax lien to any financial institution that the Comptroller reasonably believes holds property subject to a tax lien.

    (ii) The notice to be sent under this paragraph shall be provided by:

      (1) first-class mail, under the postmark of the United States Postal Service, at the address designated for this purpose by the financial institution or, if no address has been designated, to the principal office of the financial institution;

      (2) an electronic format agreed on by the Comptroller and the financial institution; or

      (3) any other reasonable manner as agreed on by the Comptroller and the financial institution.

  (2) The notice to be sent by the Comptroller to a financial institution under paragraph (1) of this subsection shall contain:

    (i) the name of the obligor;

    (ii) the amount of the tax lien;

    (iii) the last known address of the obligor;

    (iv) the Social Security number or federal employer identification number of the obligor; and

    (v) a notice to immediately seize and attach from one or more accounts held by the financial institution in the name of the obligor an aggregate amount equal to the lesser of the amounts in all accounts or the amount of the tax lien.

(c)

  (1) On receipt of the notice described in subsection (b) of this section, the financial institution promptly shall seize and attach from one or more of the accounts of the obligor held by the financial institution an aggregate amount equal to the lesser of:

    (i) the total of the amounts in all the accounts of the obligor held by the financial institution; or

    (ii) the amount stated in the notice sent under subsection (b) of this section.

  (2) Within 30 days after the financial institution receives the notice directing it to seize and attach accounts of the obligor, the financial institution shall send notice to the Comptroller, in the manner specified in subsection (b) of this section, specifying the aggregate amount held under this subsection.

  (3)

    (i) The financial institution may assess a fee against the accounts or the obligor, in addition to the amount identified in the notice under subsection (b) of this section.

    (ii) In the case of insufficient funds to cover both the fee and the amount identified in the notice under subsection (b) of this section, the financial institution may first deduct and retain the fee from the amount seized and attached as provided in this section.

  (4) The financial institution may not be held liable to any person, including the Comptroller, the obligor, or any account holder of interest, for wrongful dishonor or for any other claim relating to the seizure and attachment of an account or other actions taken in compliance with this section.

(d)

  (1) Within 10 business days after the Comptroller has received notice from the financial institution under subsection (c)(2) of this section, the Comptroller shall send a notice to the obligor, by regular mail, to the obligor's last known address.

  (2) The notice shall contain the following information, to the extent known by the Comptroller:

    (i) the address of the Comptroller;

    (ii) the telephone number, address, and name of a contact person at the Office of the Comptroller;

    (iii) the name and Social Security number, federal employer identification number, or other taxpayer identification number of the obligor;

    (iv) the address of the obligor;

    (v) for each account of the obligor, the name of the financial institution that has seized and attached amounts as required by this section;

    (vi) the total amount of the tax lien owed by the obligor;

    (vii) the date the notice is being sent;

    (viii) a statement informing the obligor that the Comptroller has directed the financial institution to seize and attach the amount of the tax lien owed by the obligor from one or more of the accounts of the obligor and, on subsequent notice by the Comptroller, to forward the amount to the Comptroller; and

    (ix) a statement informing the obligor that, unless a timely challenge is made by the obligor or an account holder of interest under subsection (g) of this section, the Comptroller shall notify the financial institution to forward the amount seized and attached by the financial institution to the Comptroller.

  (3) The Comptroller shall not be obligated to send the notice described in paragraphs (1) and (2) of this subsection if, prior to the time that the notice must be sent, the Comptroller and the obligor agree to an arrangement under which the obligor will pay amounts owed under the tax lien.

(e)

  (1) If a timely challenge is not made by the obligor or an account holder of interest under subsection (g) of this section, the Comptroller shall send a notice to the financial institution, in the manner specified in subsection (b) of this section, directing the institution to:

    (i) forward the amount seized and attached by the financial institution to the Comptroller;

    (ii) reduce the amount seized and attached by the financial institution to a revised amount as stated, forward the revised amount to the Comptroller, and release the excess amount; or

    (iii) release the amount seized and attached by the financial institution.

  (2) The Comptroller may send the notice described in paragraph (1) of this subsection before the time for filing a timely challenge under subsection (g) of this section on agreement among the Comptroller, the obligor, and, if the Comptroller is aware of an account holder of interest, the account holder of interest.

(f) The Comptroller shall apply the amount seized and forwarded by the financial institution to the obligor's tax lien obligation.

(g)

  (1) An obligor or an account holder of interest may challenge the actions of the Comptroller under this section by filing a motion with the circuit court within 10 days of the date of the notice sent under subsection (d)(1) of this section.

  (2) An obligor or an account holder of interest may challenge the actions of the Comptroller based on:

    (i) a mistake in the identity of the obligor;

    (ii) a mistake in the ownership of the account;

    (iii) a mistake in the contents of the account;

    (iv) invalidity of the Comptroller's actions under Sec. 11-603 of the Courts Article;

    (v) a mistake in the amount of the lien obligation due; or

    (vi) any other good cause.

  (3) An obligor or an account holder of interest may not challenge the actions of the Comptroller based on a mistake or error in the original tax assessment underlying the tax lien against the obligor.

(h)

  (1) The Comptroller may withdraw the notice to seize and attach accounts by sending notice to the financial institution, in the manner specified in subsection (b) of this section, directing the financial institution to release the attachment on the accounts.

  (2) If a determination is made by the Comptroller or by the circuit court that the account or accounts of the obligor should not have been held, the Comptroller shall notify the financial institution, in the manner specified in subsection (b) of this section, to release the amount seized and attached by the financial institution.

  (3) If a determination is made by the Comptroller or by the circuit court, pursuant to a challenge under subsection (g) of this section, to reduce the amount seized and attached by the financial institution, the Comptroller shall notify the financial institution, in the manner specified in subsection (b) of this section, to revise the amount as stated, forward the revised amount to the Comptroller, and release the excess amount seized and attached by the financial institution.

  (4) If a challenge made under subsection (g) of this section is denied by the circuit court, the Comptroller shall notify the financial institution, in the manner specified in subsection (b) of this section, to forward the amount seized and attached by the financial institution to the Comptroller.

(i) A financial institution that complies with a notice from the Comptroller sent under this section is not liable under State law to any person for:

  (1) any disclosure of information to the Comptroller under this section;

  (2) seizing and attaching any amounts from an account or sending any amount seized and attached by the financial institution to the Comptroller; or

  (3) any other action taken in good faith to comply with the requirements of this section.

(j) A financial institution has no obligation to reimburse fees assessed as a result of the Comptroller instituting an action under this section or as otherwise permitted by law or authorized by contract.

(k) This section may not be construed to prohibit the Comptroller from collecting taxes due from the obligor in any other manner authorized by law.

#### Section 13-815

(a) Within the period allowed in Subtitle 11 of this title, an action to collect tax imposed under this article may be brought in a court of competent jurisdiction.

(b) If a person owes State and county or municipal corporation taxes to the same tax collector, an action under this section may combine claims for those taxes.

#### Section 13-816

(a) If a tax under this article is not paid when due, the Governor, tax collector, or Treasurer shall ask a qualified attorney who is a regular salaried employee of the Comptroller or the Attorney General to bring an action against the person responsible to pay the tax, unless a lien on real property under Part II of this subtitle sufficiently secures the tax or a judgment in the action would not be collectible.

(b)

  (1) If a request is made under subsection (a) of this section, the attorney or the Attorney General shall bring the action.

  (2) In an action under this section, the plaintiff shall be:

    (i) the State;

    (ii) the Treasurer; or

    (iii) the tax collector authorized by law to collect the tax.

(c) If the attorney or Attorney General and the tax collector agree that the full amount of the claim is not collectible, the attorney or Attorney General may:

  (1) compromise the claim;

  (2) accept a lesser amount; and

  (3) issue a release of the claim or a satisfaction of the judgment.

#### Section 13-817

(a) In an action under Sec. 13-816 of this subtitle, a request for attachment before judgment against any asset of the defendant may be filed in accordance with the Maryland Rules.

(b) The plaintiff in the action is not required to file an attachment bond.

#### Section 13-818

(a) If the plaintiff in an action under Sec. 13-816 of this subtitle requests, the action shall be tried as soon as the action is at issue and shall take precedence over all other civil cases.

(b) In an action under Sec. 13-816 of this subtitle, a certificate of the tax collector that shows the amount of tax, penalty, and interest due:

  (1) is prima facie evidence of the amount of tax, penalty, and interest; and

  (2) imposes on the defendant the burden of proving that the tax, penalty, and interest have been paid or any other defense.

#### Section 13-821

(a) Notwithstanding any other provision of this title, if a tax collector finds that the collection of a tax under this article will be jeopardized by the departure, from the State, of the person required to pay the tax, the removal of property from the State, the concealment of the person or the property, or any other act, the tax collector immediately may assess the tax, interest, and penalty as a jeopardy assessment.

(b) The tax collector shall mail to the person required to pay the tax a notice of jeopardy assessment that states:

  (1) the findings about the jeopardy of tax collection;

  (2) the amount of the assessment; and

  (3) a demand that the person immediately:

    (i) pay the assessment; or

    (ii) submit evidence that collection of the tax is not in jeopardy.

(c) The findings of the tax collector about the jeopardy of tax collection are final and conclusive.

(d) If, within the 10 days after a notice of jeopardy assessment is mailed, a person fails to comply with the notice, the tax collector may take any action to collect the unpaid tax as authorized under this title.

#### Section 13-824

To protect tax revenue, a tax collector may, to the extent allowed or required under Sec. 13-825 of this subtitle:

(1) set an amount to secure payment of the tax, interest, and penalty that is due or may become due; and

(2) require acceptable security to be posted.

#### Section 13-825

(a) The Comptroller may require a person whose gross receipts are subject to admissions and amusement tax and whose business is not a permanent operation in the State to post security for the tax in the amount that the Comptroller determines.

(b) The Comptroller shall require:

  (1) a manufacturer, wholesaler, or nonresident winery permit holder who sells or delivers beer or wine to retailers in the State to post security for the alcoholic beverage tax:

    (i) in an amount not less than:

      (1) $1,000 for beer; and

      (2) $1,000 for wine; and

    (ii) if the alcoholic beverage tax on beer and wine paid in any 1 month exceeds $1,000, in an additional amount at least equal to the excess;

  (2) a manufacturer or wholesaler who sells or delivers any distilled spirits or any wine and distilled spirits in the State to post a security for the alcoholic beverage tax:

    (i) in an amount not less than $5,000; and

    (ii) in an additional amount:

      (1) equal to twice the amount of its largest monthly alcoholic beverage tax liability for wine and distilled spirits in the preceding calendar year less $5,000; or

      (2) if the information for the preceding calendar year is not available or cannot be provided, equal to the amount that the Comptroller requires; and

  (3) except as provided in subsection (i) of this section, a holder of a direct wine shipper's permit to post security for the alcoholic beverage tax in an amount not less than $1,000.

(c) The Comptroller may require a person whose gross receipts are subject to the boxing and wrestling tax to post security for the boxing and wrestling tax in the amount that the Comptroller determines.

(d) The Comptroller may require a real estate investment trust to post security for income tax in the amount that the Comptroller requires, if the trust:

  (1) does not hold property in the State; or

  (2) holds insufficient property in the State to provide adequate security for the income tax if the property were to become subject to a lien under this subtitle.

(e) The Comptroller may require a person seeking a refund of motor carrier tax to post security for the tax in an amount of not less than $5,000 but not more than $100,000.

(f) The Comptroller shall require an applicant for any license under Title 9 of this article, except for a Class "W" license, to post security for the motor fuel tax in the amount that the Comptroller requires, but not less than:

  (1) $200,000 for a Class "A" license;

  (2) $50,000 for a Class "B" license;

  (3) $10,000 for a Class "C" license;

  (4) $200,000 for a Class "D" license;

  (5) $1,000 for a Class "F" license;

  (6) $10,000 for a Class "G-Temporary" license;

  (7) $1,000 for a Class "S" license; and

  (8) $1,000 for a Class "U" license.

(g) The Comptroller may require a person subject to the sales and use tax to post security for the tax in the amount that the Comptroller determines.

(h)

  (1) The Comptroller may require a person subject to the tobacco tax to post security for the tax in the following amounts:

    (i) for a manufacturer or wholesaler:

      (1) $10,000; plus

      (2) the amount, if any, by which the tobacco tax due for any 1 month exceeds $10,000;

    (ii) for a subwholesaler or vending machine operator:

      (1) $1,000; plus

      (2) the amount, if any, by which the tobacco tax due for any 1 month exceeds $1,000;

    (iii) for an other tobacco products wholesaler:

      (1) $5,000; plus

      (2) the amount, if any, by which the tobacco tax due for any 1 month exceeds $5,000; and

    (iv) for an out-of-state seller:

      (1) $5,000; plus

      (2) the amount, if any, by which the tobacco tax due for any reporting period exceeds $5,000.

  (2) Except as provided in paragraph (5) of this subsection, the Comptroller may exempt a person from posting security for the tobacco tax if the person is and has been for the past 5 years:

    (i) licensed as required under Sec. 16-202 of the Business Regulation Article to act as a wholesaler, Sec. 16.5-201 to act as an other tobacco products wholesaler, or Sec. 16.9-201 to act as a remote tobacco seller; and

    (ii)

      (1) in continuous compliance with the tobacco tax laws, as determined under paragraph (3) of this subsection; and

      (2) in continuous compliance with the conditions of the person's security posted under this subsection.

  (3) For purposes of paragraph (2) of this subsection, a person is in continuous compliance with the tobacco tax laws for a period if the person has not, at any time during that period:

    (i) failed to pay any tobacco tax or any tobacco tax assessment when due;

    (ii) failed to file a tobacco tax return when due; or

    (iii) otherwise violated any of the provisions of this title, Title 12 of this article, or Title 16, Title 16.5, or Title 16.9 of the Business Regulation Article.

  (4)

    (i) An exemption granted under paragraph (2) of this subsection is effective only to the extent that a person's potential tobacco tax liability does not exceed an amount determined by the Comptroller based on the person's experience during the 5-year compliance period under paragraph (2) of this subsection.

    (ii) The Comptroller may revoke an exemption granted to a person under paragraph (2) of this subsection if the person at any time fails to be in continuous compliance with the tobacco tax laws, as described in paragraph (3) of this subsection.

    (iii) The Comptroller may reinstate an exemption revoked under subparagraph (ii) of this paragraph if the person meets the requirements of paragraph (2)(i) and (ii) of this subsection for a period of 2 years following the revocation.

  (5) The Comptroller may not exempt a person from posting a bond or other security for the tobacco tax unless the Comptroller determines that the person is solvent and financially able to pay the person's potential tobacco tax liability.

  (6) If a corporation is granted an exemption from posting a bond or other security for the tobacco tax, any officer of the corporation who exercises direct control over its fiscal management is personally liable for any tobacco tax, interest and penalties owed by the corporation.

(i) A person need not post security under subsection (b)(3) of this section if:

  (1) the person is a manufacturer that has posted security under subsection (b)(2) of this section; or

  (2) at any time starting 3 years after the Comptroller first issues a direct wine shipper's permit to the person, the Comptroller:

    (i) determines that the person has a substantial record of tax and reporting compliance; and

    (ii) waives the security requirement.

#### Section 13-826

The following securities are acceptable:

(1) a bond issued by a surety company that is authorized to do business in the State and is approved by the State Insurance Commissioner as to solvency and responsibility;

(2) cash in an amount that the tax collector approves;

(3) marketable securities that the tax collector approves; or

(4) for admissions and amusement tax, alcoholic beverage tax, boxing and wrestling tax, and tobacco tax, an irrevocable letter of credit:

  (i) in an amount that the Comptroller approves; and

  (ii) with a date certain for coverage during the collection period.

#### Section 13-827

When a tax collector requires a person to post security under Sec. 13-825 of this subtitle, the tax collector shall mail the person a notice of the requirement and the amount required to be posted.

#### Section 13-828

(a) If, within 5 days after the date on which the notice to post security is mailed to a person, the person submits to the tax collector a written request for a hearing, the tax collector shall:

  (1) hold the hearing; and

  (2) at the hearing, make a final determination of the necessity for, propriety of, and amount of the security.

(b) The tax collector shall mail the person a notice of the final determination.

#### Section 13-829

(a) Except as provided in subsection (b) of this section, a person shall post the security required under Sec. 13-825 of this subtitle within 5 days after the date on which the notice is mailed under Sec. 13-827 of this subtitle.

(b) If a hearing is held under Sec. 13-828 of this subtitle, a person shall post the security within 15 days after the date on which the notice of the tax collector's final determination is mailed.

#### Section 13-830

If the tax, interest, and penalty are not paid when due, the tax collector, without notice to the person who posted the security under Sec. 13-829 of this subtitle, may:

(1) apply a cash or security deposit to the tax, interest, or penalty; or

(2) sell a security at public or private auction and apply the proceeds of the sale to the tax, interest, or penalty.

#### Section 13-831

(a) Except for a liability that has accrued or will accrue before the date of release or discharge, a surety is released and discharged from liability on a bond to the State 60 days after the surety submits to the tax collector a written request for release or discharge.

(b) On receipt of a written request from a surety for release and discharge, the tax collector promptly shall give the person who posted the bond notice that:

  (1) the surety has asked to be released and discharged from liability on the bond; and

  (2) a substitute security must be filed before the date on which the surety is released and discharged under subsection (a) of this section.

#### Section 13-832

(a) Subject to the limitation in subsection (b) of this section, if a tax under this article is referred for collection to an independent agency with which the Comptroller has contracted for the collection of taxes, in addition to interest and penalties required to be assessed under this subtitle the Comptroller shall assess a collection fee sufficient to cover all collection costs charged by the agency to the Comptroller.

(b) The collection fee assessed by the Comptroller under paragraph (a) of this section may not, as a percentage, exceed the percentage of the fee charged by the Central Collection Unit in accordance with Sec. 3-304(a)(2) of the State Finance and Procurement Article.

(c) For reasonable cause, the Comptroller may waive or reduce a collection fee assessed under this section.

#### Section 13-834

(a) In this Part VI of this subtitle the following words have the meanings indicated.

(b) "Contraband alcoholic beverage" means an alcoholic beverage, as defined in Sec. 5-101 of this article:

  (1) on which alcoholic beverage tax is not paid; and

  (2) that is delivered, possessed, sold, or transported in the State in a manner not authorized under Title 5 of this article or the Alcoholic Beverages Article.

(c) "Contraband tobacco products" means cigarettes or other tobacco products, as defined in Sec. 12-101 of this article:

  (1) on which tobacco tax is not paid; and

  (2) that are delivered, possessed, sold, or transported in the State in a manner not authorized under Title 12 of this article or Title 16 of the Business Regulation Article.

(d) "Contraband motor fuel" means motor fuel, as defined in Sec. 9-101 of this article:

  (1) on which motor fuel tax is not paid; and

  (2) that is delivered, possessed, sold, or transferred in the State in a manner not authorized under Title 9 of this article or Title 10 of the Business Regulation Article.

(e) "Conveyance" means:

  (1) an aircraft, vehicle, or vessel used to transport alcoholic beverages, cigarettes, or other tobacco products; and

  (2) a tank car, vehicle, or vessel that is used to transport motor fuel and that, exclusive of any tank used for its own propulsion, has a capacity exceeding 50 gallons.

#### Section 13-835

(a) The Comptroller, the Executive Director, or a peace officer of the State may:

  (1) seize contraband alcoholic beverages or contraband tobacco products in the State without a warrant;

  (2) stop and search a conveyance in the State if the Comptroller, the Executive Director, or officer knows or has reason to suspect that the conveyance is being used to transport in the State contraband tobacco products having a retail value of $100 or more or contraband alcoholic beverages; and

  (3) seize a conveyance being used in the State to transport contraband alcoholic beverages or contraband tobacco products.

(b) A police officer of the State may:

  (1) seize any contraband motor fuel in the State without a warrant;

  (2) stop and search a conveyance in the State for contraband motor fuel if the officer has probable cause to believe that the conveyance is being used to carry contraband motor fuel in the State; and

  (3) seize a conveyance being used to transport contraband motor fuel.

#### Section 13-836

(a)

  (1) If contraband alcoholic beverages or contraband tobacco products are seized:

    (i) the Comptroller, the Executive Director, or police officer shall give a notice of seizure to the person from whom the property is seized at the time of the seizure; and

    (ii) the Comptroller or the Executive Director shall:

      (1) where possible, give a notice of seizure to the registered owner of a seized conveyance; and

      (2) publish a notice of seizure of the conveyance in a newspaper of general circulation in the county where the seizure occurred.

  (2) If contraband motor fuel is seized, within 48 hours after the seizure, not including weekends and holidays, the Comptroller shall give a notice of seizure to:

    (i) the owner of the contraband motor fuel;

    (ii) the registered owner of the seized conveyance; and

    (iii) any secured party noted in the records of the Motor Vehicle Administration.

  (3) A notice of seizure shall state the right of an owner or other interested person, including a secured party of record, to file a claim for the return of the seized property.

(b)

  (1) A police officer who seizes a conveyance used to transport contraband alcoholic beverages promptly shall notify the Comptroller and the Executive Director of the seizure.

  (2) A police officer who seizes any contraband tobacco products or conveyance used to transport contraband tobacco products shall deliver the seized cigarettes or other tobacco products and conveyance to the Comptroller or the Executive Director, as appropriate.

  (3) A police officer who seizes any contraband motor fuel shall:

    (i) deliver the seized contraband motor fuel and conveyance to the Comptroller; or

    (ii) if the seized conveyance is operated by a common carrier, regulated by either the Maryland Public Service Commission or the Interstate Commerce Commission, and transports motor fuel for another person, for a fee, direct the operator of the conveyance to take it to a location that the Comptroller designates.

(c) For a seized conveyance transporting contraband motor fuel that is operated by a common carrier, the Comptroller shall:

  (1) remove the contraband from the conveyance at the location that the Comptroller designates;

  (2) retain the contraband, subject to Sec.Sec. 13-840 and 13-841 of this subtitle;

  (3) after removing the contraband, release the conveyance to its operator; and

  (4) reimburse the common carrier for all tariff charges applicable to the movement of the conveyance from:

    (i) the place of seizure to the location where the contraband motor fuel was removed; and

    (ii) the place where the contraband motor fuel was removed to the nearer of the common carrier's home terminal or the place of seizure.

#### Section 13-837

The owner or another person with an interest in seized property may file a claim for the return of the property with the Comptroller or the Executive Director within 30 days after:

(1) the seizure of alcoholic beverages, cigarettes, other tobacco products, motor fuel or conveyances used to transport motor fuel; or

(2) a notice of seizure of a conveyance used to transport alcoholic beverages, cigarettes, or other tobacco products is published.

#### Section 13-838

(a) A person forfeits any interest, right, or title to property that is seized for violation of the alcoholic beverage tax laws if the person:

  (1) fails to file a claim for return of the seized property within the time allowed under Sec. 13-837 of this subtitle; or

  (2) is adjudged guilty of violating the alcoholic beverage tax laws.

(b)

  (1) If, within the time allowed to file a claim under Sec. 13-837 of this subtitle, a person who has a lien interest in property seized for violation of the alcoholic beverage tax law files a petition, the circuit court for the county in which property is seized shall proceed in rem to hear and determine the question of forfeiture of the interest by the lien holder.

  (2) If the circuit court finds that the lien holder had knowledge of the intended unlawful use of the property, the interest, right, and title of a lien holder shall be forfeited.

  (3) Absent a finding under paragraph (2) of this subsection, the Comptroller or the Executive Director, as appropriate, in the best interest of the State may:

    (i) pay the outstanding indebtedness secured by the lawful lien and keep the property; or

    (ii) deliver the property to the lien holder.

#### Section 13-839

(a) If a person files a claim for return of seized alcoholic beverages, cigarettes, other tobacco products, or a conveyance used for their transportation under Sec. 13-837 of this subtitle, the Comptroller, the Executive Director, or their designee shall:

  (1) promptly act on the request and hold an informal hearing;

  (2) direct the return of alcoholic beverages, cigarettes, or other tobacco products unless the Comptroller, the Executive Director, or their designee has satisfactory proof that the person was not in compliance with any provisions of Title 5 or Title 12 of this article at the time of seizure; and

  (3) direct the return of the conveyance if the Comptroller, the Executive Director, or their designee has satisfactory proof that the owner of the conveyance was not willfully evading any provisions of Title 5 or Title 12 of this article at the time of seizure.

(b) The Comptroller, the Executive Director, or their designee shall grant or deny the application for return of seized alcoholic beverages, cigarettes, other tobacco products, or a conveyance in accordance with subsection (a) of this section by mailing the person a notice of final determination.

#### Section 13-840

(a) If a person files with the Comptroller a claim for return of the seized motor fuel or conveyances used in its transportation, the Comptroller shall:

  (1) provide an opportunity for a hearing; and

  (2) if requested by the claimant, conduct the hearing within 5 working days after the claim is received.

(b) The Comptroller shall:

  (1) make a final determination of whether the property should be forfeited within 2 working days after the date of the conclusion of the hearing; and

  (2) mail a notice of the final determination on the date on which that determination is made.

#### Section 13-841

(a)

  (1) Contraband alcoholic beverages that are seized under this title and forfeited may be disposed of or destroyed in the manner allowed under Sec.Sec. 6-105, 6-106, and 6-328 of the Alcoholic Beverages and Cannabis Article.

  (2) The Comptroller or the Executive Director, as appropriate, shall sell at public auction a conveyance that is seized under this title in connection with contraband alcoholic beverages and forfeited.

(b)

  (1) The Comptroller or the Executive Director, as appropriate, shall sell contraband tobacco products seized under this title and forfeited to a State institution, a nonprofit charitable institution, a licensed cigarette wholesaler, or a licensed cigarette manufacturer in the manner the Comptroller or Executive Director determines.

  (2) The Comptroller or the Executive Director, as appropriate, shall sell at public auction a conveyance that is seized under this title in connection with contraband tobacco products and forfeited.

(c)

  (1) If either the Comptroller or, on appeal, a court determines that seized conveyance or motor fuel is not subject to forfeiture:

    (i) the Comptroller is not required to return the motor fuel seized to the owner or other interested person who filed the claim for return of the property, but may, at the option of the Comptroller, pay to the person an amount equal to the value of the motor fuel as determined by the average wholesale value on the date of seizure for the Baltimore Terminal as reported by a nationally recognized oil price reporting service on the date of seizure; and

    (ii) the Comptroller shall return the conveyance to the registered owner and shall have no further liability to the registered owner.

  (2) If a seized conveyance or motor fuel is forfeited, the Comptroller shall:

    (i)

      (1) use the contraband motor fuel for any public purpose; or

      (2) sell the contraband motor fuel to any person; and

    (ii) sell the seized conveyance to any person.

(d)

  (1) In the manner required under Title 2 of this article for distributions of revenue, the Comptroller shall distribute the net proceeds from the sale of any conveyance or other property under this section after paying:

    (i) the costs incurred in conjunction with the seizure and disposal of the property;

    (ii) the cost of the sale; and

    (iii) any bona fide lien against the conveyance.

  (2) If the Executive Director sells at public auction a conveyance or other property seized under this section, the Executive Director shall transfer the net proceeds of the sale to the Comptroller for distribution under Title 2 of this article.

#### Section 13-842

A person who possessed contraband alcoholic beverages, contraband tobacco products, or contraband motor fuel that are seized and sold under this section is not relieved from any penalty under this title.

#### Section 13-845

(a) Except as provided in subsection (b) of this section, if the inheritance tax determined on an interest in property under Sec. 7-209, Sec. 7-210, or Sec. 7-211 of this article is not paid when due, the court that has jurisdiction to administer the estate shall order the personal representative to sell as much of the interest in property on which inheritance tax is unpaid as is necessary to:

  (1) pay inheritance tax on the property; and

  (2) pay the expenses of the sale.

(b) A court may not order the sale of an interest in property under subsection (a) of this section after the period provided for the lien on the property under Sec. 13-806 of this subtitle has expired.

### Subtitle 9. Refunds and Offsets

#### Section 13-901

(a) A claim for refund may be filed with the tax collector who collects the tax, fee, or charge by a claimant who:

  (1) erroneously pays to the State a greater amount of tax, fee, charge, interest, or penalty than is properly and legally payable;

  (2) pays to the State a tax, fee, charge, interest, or penalty that is erroneously, illegally, or wrongfully assessed or collected in any manner; or

  (3) pays a tax qualifying for refund under subsections (b) through (h) of this section.

(b) A claim for refund of alcoholic beverage tax may be filed by a claimant who:

  (1) buys alcoholic beverages that are exempt under Sec. 5-104(b) of this article;

  (2) discontinues an alcoholic beverage business;

  (3) discontinues the sale and delivery in the State of alcoholic beverages in certain container sizes; or

  (4) holds alcoholic beverages for sale that:

    (i) are condemned by an authorized official; or

    (ii) if the claim is $250 or more, are lost, rendered unmarketable, or destroyed in the State due to fire, flood, or other disaster, or due to vandalism or malicious mischief, except loss due to theft.

(c)

  (1) A claim for refund of income tax may be filed by a claimant whose Maryland taxable income is decreased as a result of a federal contract renegotiation under Sec. 1481 of the Internal Revenue Code.

  (2) A claim for refund of income tax under this subsection or subsection (a) of this section may be filed:

    (i) by the claimant; or

    (ii) on behalf of the claimant, by a person allowed to file a return under Sec. 10-808 of this article.

(d) A claim for refund of Maryland estate tax or Maryland generation-skipping transfer tax may be filed by a claimant required to pay the tax if:

  (1) the Maryland estate tax is decreased as a result of:

    (i) a decrease in the federal estate tax on the estate; or

    (ii) an inheritance tax payment made after a Maryland estate tax payment; or

  (2) the Maryland generation-skipping transfer tax is decreased as a result of a decrease in the federal generation-skipping transfer tax on the generation-skipping transfer.

(e) A claim for refund of motor carrier tax may be filed by a claimant who has excess motor carrier tax credit, if:

  (1) the claimant has provided the security required for a motor carrier under Sec. 13-825 of this title; or

  (2) the Comptroller has audited the records of the claimant.

(f)

  (1) Except as provided in paragraph (3) of this subsection, a claim for refund of motor fuel tax may be filed by a claimant who pays the tax on:

    (i) aviation fuel, as defined in Sec. 9-101 of this article, that is:

      (1) dispensed to aircraft by an aircraft manufacturing company located in the State; or

      (2) used:

      (A) by a person who engages in agricultural activities; and

      (B) in an aircraft that is used for agricultural purposes at least 70% of the time that the aircraft is used; or

    (ii) motor fuel, as defined in Sec. 9-101 of this article, that:

      (1) is used to operate:

      (A) a bus that is used only in the operation of a transportation system of a political subdivision of the State to transport the public on regular schedules between fixed termini, as defined in Title 11 of the Transportation Article;

      (B) farm equipment that is used for an agricultural purpose and is not registered to operate on a public highway;

      (C) fire or rescue apparatus or vehicles by a volunteer fire company or nonprofit volunteer rescue company incorporated in the State;

      (D) an internal combustion engine that is installed permanently at a fixed location;

      (E) a vehicle that is owned and used by a Maryland chapter of the American Red Cross or a bona fide unit of a national veterans' organization; or

      (F) a vehicle that is used only in the operation of a transportation system of a political subdivision of the State to transport the public on demand response trips;

      (2) is bought by:

      (A) the United States or a unit of the United States government;

      (B) the Department of General Services for use by State agencies;

      (C) a county board of education for use in a school bus owned by a county board of education;

      (D) a school bus operator under contract with a county board of education for use in a school bus used to transport the county's public school students; or

      (E) a person who is required to pay a tax on the same fuel to another state;

      (3) except for any operation of a motor vehicle on a public highway in the State, is used for a commercial purpose, including:

      (A) the operation of a vessel used only for commercial purposes;

      (B) commercial cleaning; or

      (C) commercial dyeing;

      (4) is used in any of the following vehicles that have pumping or other equipment mechanically or hydraulically driven by the engine that propels the vehicle:

      (A) a concrete mixing motor vehicle or concrete pump truck;

      (B) a motor fuel delivery vehicle;

      (C) a solid waste compacting vehicle;

      (D) a well-drilling vehicle; or

      (E) farm equipment registered as a vehicle for highway use that is designed or adapted solely and used exclusively for bulk farm spreading of agriculture liming materials, chemicals, or fertilizer;

      (5) is used by a system of transportation based in the State, in a vehicle that is used to provide transportation to elderly or low income individuals, or individuals with disabilities, if the system is operated by a nonprofit organization for purposes relating to the charge for which the nonprofit organization was established and the nonprofit organization:

      (A) is exempt for federal income tax purposes under Sec. 501(c) of the Internal Revenue Code;

      (B) is funded to provide transportation to elderly or low income individuals, or individuals with disabilities;

      (C) receives part of its operating funding from the Maryland Department of Transportation or the Maryland Department of Health;

      (D) has stated in its charter or bylaws that operating transportation services for elderly or low income individuals, or individuals with disabilities, is one of the purposes for which it was established; and

      (E) is actively operating a system of transportation for elderly or low income individuals, or individuals with disabilities; or

      (6) is lost as a result of fire, collision, or other casualty, except for loss in ordinary transportation and storage.

  (2) A refund based on a claim under paragraph (1)(ii)4 of this subsection may not exceed the following percentages of the motor fuel tax paid:

    (i) 35% for a concrete mixing vehicle or concrete pump truck;

    (ii) 55% for farm equipment, registered as a vehicle for highway use, that is designed or adapted solely and used exclusively for bulk spreading of agriculture liming materials, chemicals, or fertilizers;

    (iii) 10% for a motor fuel delivery vehicle;

    (iv) 15% for a solid waste compacting vehicle; and

    (v) 80% for a well-drilling vehicle.

  (3) A person may not make a claim for a refund of motor fuel tax under paragraph (1)(ii)1B of this subsection for motor fuel used to operate a farm truck under the provisions of Sec. 8-602(c) of the Transportation Article.

(g) A claim for refund of sales and use tax may be filed by a claimant who:

  (1) pays the tax on a sale exempt under Sec. 11-216 of this article;

  (2) refunds the tax to a buyer in a canceled or rescinded sale under Sec. 11-403(c) or Sec. 11-403.1(c) of this article;

  (3) pays the tax in a canceled or rescinded sale for which the vendor or marketplace facilitator refuses to refund the tax as required under Sec. 11-403(c) or Sec. 11-403.1(c) of this article; or

  (4) pays the tax under Sec. 11-408(c) of this article on a cash sale or sale for use that is not a retail sale.

(h)

  (1) A claim for refund of tobacco tax may be filed by a claimant who buys tobacco tax stamps that:

    (i) are affixed erroneously to anything other than a package of cigarettes;

    (ii) are affixed to a package of unsalable cigarettes;

    (iii) are canceled by the Comptroller;

    (iv) if the claim is $250 or more, are lost or destroyed in the State due to fire, flood, or other disaster, vandalism, or malicious mischief;

    (v) mutilated or damaged, whether or not affixed to a package of cigarettes; or

    (vi) subject to paragraph (2) of this subsection, are lost due to theft.

  (2)

    (i) A claimant may receive a refund for tobacco tax stamps lost due to theft by providing to the Comptroller:

      (1) a copy of the police report with a detailed inventory of the stolen property, including when the property was ordered, loaded onto the truck, and stamped; and

      (2) a notarized affidavit signed by the claimant under penalty of perjury attesting to the truth of the information provided in the claim for a refund.

    (ii) If the stolen property is recovered, the claimant shall notify the Comptroller and return any refund received under this paragraph.

    (iii) In addition to other penalties authorized by law, a claimant is subject to a fine of double the amount of any tax refund received under this paragraph for making a false claim.

    (iv) The Comptroller may adopt regulations to carry out this paragraph.

#### Section 13-902

A claim for refund shall be:

(1) made, under oath, in the form that the tax collector requires; and

(2) supported by the documents that the tax collector requires, including original invoices showing alcoholic beverage and motor fuel purchases.

#### Section 13-903

A claim for refund shall be filed within the time required under Sec. 13-1104 of this title.

#### Section 13-904

(a) The tax collector shall:

  (1) investigate each claim for refund; and

  (2) conduct a hearing at the request of the claimant prior to a final determination on the claim.

(b) The tax collector shall give the claimant notice of:

  (1) the determination of the claim for refund; and

  (2) any delay in paying an allowed claim.

#### Section 13-905

(a) Subject to the additional provisions under this section, a tax collector shall pay any claim for refund that has been allowed by the tax collector unless:

  (1) the claimant has not paid all other taxes, fees, or charges payable to the State; or

  (2) the amount of the refund due is less than $1.

(b) If a claim for refund of income tax is based on a return that is filed jointly by the personal representative and surviving spouse of a decedent, the Comptroller shall pay the claim to the estate of the decedent.

(c) The payment of income tax refunds is subject to tax refund interception under Sec. 10-113 of the Family Law Article and Sec.Sec. 13-912 through 13-919 of this subtitle.

(d) The Comptroller may not pay a refund of excess motor carrier tax credit unless the motor carrier has complied with Title 9, Subtitle 2 of this article and regulations adopted under it for a full registration year and the Comptroller, in the Comptroller's discretion, allows the refund.

(e) For a claim of refund for sales and use tax, the Comptroller shall either:

  (1) pay the refund; or

  (2) allow a credit of the amount of the refund on subsequent sales and use tax payments due from the claimant.

(f) If requested by a claimant on a form provided by the Comptroller, the Comptroller shall directly deposit portions of an income tax refund into at least two accounts at one or more financial institutions.

#### Section 13-906

(a) In this section, "register" means the register of wills of a county.

(b)

  (1) If a person is required to pay inheritance tax the payment of which would reduce the Maryland estate tax imposed on an estate and would entitle the estate to a Maryland estate tax refund, on the written request of the personal representative of the estate, the Comptroller may pay directly to the register, to be applied against the inheritance tax, any Maryland estate tax refund to which the estate would be entitled as a result of the payment of the inheritance tax.

  (2) If a person becomes entitled to an inheritance tax refund the payment of which would result in an increase in the Maryland estate tax imposed on an estate, on the written request of the person making a claim for the inheritance tax refund or if a claim for an inheritance tax refund has not been made, the register may pay the inheritance tax refund directly to the Comptroller to be applied against any unpaid Maryland estate tax or additional Maryland estate tax that would become due as a result of the inheritance tax refund.

(c) If a payment from the Comptroller to the register or from the register to the Comptroller under subsection (b) of this section does not discharge a person's tax liability in its entirety, the person shall pay any remaining unpaid inheritance tax to the register or any remaining unpaid Maryland estate tax to the Comptroller.

(d) Payment by the Comptroller to the register or by the register to the Comptroller under subsection (b) of this section shall satisfy the obligation of the register or Comptroller to pay a refund to the extent of the payment.

#### Section 13-908

(a) If the tax collector determines that collection of financial institution franchise tax or income tax is not warranted because of the administration and collection costs involved, the tax collector may abate the tax or any interest, penalties or charges relative to the tax.

(b)

  (1) In this subsection, "public health emergency" includes:

    (i) a national emergency declared by the President of the United States under the National Emergencies Act;

    (ii) an emergency or major disaster declared by the President of the United States under the Robert T. Stafford Disaster Relief and Emergency Assistance Act;

    (iii) a public health emergency declared by the Secretary of Health and Human Services under 42 U.S.C. Sec. 247d; and

    (iv) a catastrophic health emergency declared by the Governor under Sec. 14-3A-02 of the Public Safety Article.

  (2) The income tax imposed under this article shall be abated in the case of any individual:

    (i) who dies while in active service as a member of the uniformed services, if such death occurs while serving in a combat zone or a public health emergency response area or as a result of wounds, disease, or injury incurred while so serving; or

    (ii) who dies while a member of the uniformed services or civilian employee of the United States, if such death occurs as a result of wounds, disease, or injury incurred while the individual was a member of the uniformed services or civilian employee of the United States and which were incurred outside the United States in a public health emergency response or a terroristic or military action.

  (3) The abatement of tax shall have the same effect and shall apply to the same taxable years as provided under Sec. 692 of the Internal Revenue Code.

#### Section 13-909

(a) Without regard to the provisions of Sec. 13-1104 of this title, if the tax collector determines a person's financial institution franchise tax or income tax for multiple taxable years and simultaneously finds both overpayments and deficiencies in those taxable years, the tax collector:

  (1) may offset the deficiencies to the extent of the overpayments; but

  (2) may not allow a refund that is barred under Subtitle 11 of this title.

(b) An overpayment determined under subsection (a) of this section may not be applied as an offset to a deficiency in any taxable year other than the years included in the Comptroller's determination under subsection (a) of this section.

#### Section 13-912

(a) In this part the following words have the meanings indicated.

(b) "Central Collection Unit" means the Central Collection Unit in the Department of Budget and Management.

(c)

  (1) "Debt" means:

    (i) a liquidated sum due and owing any State agency that has accrued through contract, subrogation, tort, operation of law, or other cause of action, regardless of whether there is an outstanding judgment for that sum; or

    (ii) a delinquent restitution account on a judgment of restitution referred to the Central Collection Unit for collection under Sec. 11-616 of the Criminal Procedure Article.

  (2) "Debt" includes converted funds as defined in Sec. 15-122.2 of the Health - General Article.

(d) "Debtor" means:

  (1) a person owing a debt to a State agency that has not been adjudged satisfied by court order, set aside by court order, or discharged in bankruptcy; or

  (2) a defendant or liable parent in arrears of restitution payments whose account has been referred to the Central Collection Unit under Sec. 11-616 of the Criminal Procedure Article.

(e) "State agency" means any agency, association, board, bureau, college, commission, committee, council, foundation, fund, department, institute, institution, public corporation, service, trust, university, or other unit of State government, including any subunit of these agencies.

#### Section 13-913

(a)

  (1) Except as provided in paragraph (2) of this subsection, for any debt not excepted by law from the Central Collection Unit's responsibilities under Title 3, Subtitle 3 of the State Finance and Procurement Article or otherwise, the Central Collection Unit may:

    (i) certify to the Comptroller the existence of any debt that has been referred to it for collection by a State agency; and

    (ii) request the Comptroller to withhold the sum certified from any income tax refund to which a debtor is entitled.

  (2) A debt may not be withheld if the State agency or the Central Collection Unit has been advised by the Attorney General that the validity of the debt is legitimately in dispute or an alternate means of collection is pending and believed to be adequate.

(b)

  (1) The Department of Budget and Management shall establish by regulation those classes or categories of debts, including any minimum debt amount, that may be referred to the Central Collection Unit for withholding.

  (2) Subject to Sec. 13-918 of this subtitle, if more than one State agency is owed money by the same debtor, any amount withheld from an income tax refund shall be applied in the order of referral of the debt by the State agencies.

(c)

  (1) Subject to paragraph (2) of this subsection, the withholding of debt from an income tax refund authorized by this part does not preclude use of any other remedy provided by law for the collection of debts owed to the State and this part shall be liberally construed to effectuate its purposes.

  (2) This part shall be interpreted in a manner that does not deprive a debtor of any rights or defenses that would be available to that debtor in defending against a claim of setoff incident to a judicial proceeding.

#### Section 13-914

(a) At least 30 calendar days before certifying a debt to the Comptroller, the Central Collection Unit shall notify the debtor in writing that it intends to request the Comptroller to withhold the debt from any income tax refund due the debtor.

(b) The notice required under subsection (a) of this section shall advise the debtor of:

  (1) the amount due and owing;

  (2) the basis of the debt;

  (3) the opportunity to request an investigation of the debt;

  (4) the opportunity to contest any adverse determination after an investigation in a hearing before the Central Collection Unit; and

  (5) the right to a judicial appeal of a final action by the Central Collection Unit.

#### Section 13-915

(a)

  (1) A certification by the Central Collection Unit to the Comptroller shall be made on or before January 1 of each calendar year in the form that the Comptroller prescribes.

  (2) The certification shall include:

    (i) the full name and address of the debtor and any other names known to be used by the debtor;

    (ii) the Social Security number or federal tax identification number of the debtor; and

    (iii) the amount of the debt.

(b)

  (1) The Comptroller shall:

    (i) withhold any income tax refund that may be due to a debtor whose name has been certified by the Central Collection Unit; and

    (ii) pay to the Central Collection Unit the entire refund or the amount certified by the Central Collection Unit, whichever is less.

  (2) All money paid to the Central Collection Unit by the Comptroller under this part shall be disposed of by the Central Collection Unit as provided in Sec. 3-305 of the State Finance and Procurement Article.

  (3) Any income tax refund in excess of the certified amount shall be paid to the debtor.

  (4) The Comptroller shall notify the debtor of:

    (i) any amount paid to the Central Collection Unit; and

    (ii) the debtor's right:

      (1) to request an investigation by the Central Collection Unit of the validity of the debt or correctness of the amount; and

      (2) to an administrative hearing and judicial appeal if the Central Collection Unit makes a determination adverse to the debtor.

(c)

  (1) If a debtor has filed a joint income tax return and the debt is not the liability of both taxpayers, the Comptroller may not withhold that portion of an income tax refund attributable to the individual not owing the debt.

  (2) After receiving certification of a debt from the Central Collection Unit, the Comptroller shall promptly notify the Central Collection Unit if the Comptroller determines that a withholding cannot be made.

  (3) If an income tax refund is insufficient to satisfy a debt, the Comptroller may withhold amounts from subsequent income tax refunds due a debtor until the debt is extinguished.

  (4) Partial payments of the debt shall first be applied against accrued interest, if any, and then to the principal amount of the debt.

  (5) Interest on a debt may be withheld at the rate established for that debt by law or contract.

(d) Except for the amount of any income tax refund to which a debtor is entitled, the Comptroller may not disclose any item contained on a State or federal tax return or information required by State law to be attached to the State return.

#### Section 13-916

(a) A debtor may request the Central Collection Unit to investigate a debt:

  (1) after notification from the Central Collection Unit under Sec. 13-914 of this subtitle that the Central Collection Unit intends to request the Comptroller to withhold the debt from any income tax refund due the debtor; or

  (2) within 30 days after notification from the Comptroller under Sec. 13-915 of this subtitle that a debt has been withheld.

(b)

  (1) On receipt of a request for an investigation, the Central Collection Unit shall investigate any questioned debt with the State agency that referred the debt.

  (2) The Central Collection Unit shall make a written determination within 15 calendar days after it receives a request for investigation from the debtor.

  (3) If the Central Collection Unit determines that a referral or certification is in error, it shall, as appropriate:

    (i) correct the referral or certification;

    (ii) discontinue certification procedures; or

    (iii) promptly remit to the debtor any amounts that have been improperly withheld.

#### Section 13-917

(a)

  (1) After its investigation, if the Central Collection Unit makes a determination adverse to the debtor, it shall promptly advise the debtor of the debtor's right to request a hearing on unresolved factual issues before the Central Collection Unit in accordance with the Administrative Procedure Act.

  (2) Except for good cause shown, a request for a hearing before the Central Collection Unit must be made within 30 days after the date of notification of the debtor of an adverse determination by the Central Collection Unit following an investigation.

  (3) The State agency that referred the debt to the Central Collection Unit may be made a party in any hearing before the Central Collection Unit.

  (4) An issue may not be considered at the hearing that has been previously litigated.

  (5) Within 15 days after receipt of a timely or otherwise proper request for a hearing under this subsection, the debtor shall be notified of the date of the hearing.

  (6) After a hearing, if the Central Collection Unit determines that a certification or referral is in error, it shall take appropriate action as described in Sec. 13-916(b)(3) of this subtitle.

  (7) A determination by the Central Collection Unit of the validity of the debt or correctness of the amount owed shall be considered as final agency action under the Administrative Procedure Act.

(b)

  (1) A debtor aggrieved by a final decision of the Central Collection Unit concerning the validity of the debt or correctness of the amount may appeal the decision as provided for contested cases in Sec.Sec. 10-222 and 10-223 of the State Government Article.

  (2) If a debtor disputes a denial by the Comptroller of a claim for an income tax refund on grounds other than the validity of the debt or the correctness of the amount owed and that debtor also is appealing an adverse determination of the Maryland Tax Court under Sec. 13-532 of this title, judicial review of both decisions shall be consolidated.

#### Section 13-918

(a) The Comptroller shall honor income tax refund interception requests in the following order:

  (1) a refund interception request to collect an unpaid State, county, or municipal tax;

  (2) a refund interception request under Title 10, Subtitle 1, Part II of the Family Law Article;

  (3) a refund interception request for converted funds under Sec. 15-122.2 of the Health - General Article;

  (4) a refund interception request under Sec. 3-304 of the State Finance and Procurement Article;

  (5) any other refund interception request by the State, county, or other political subdivision of the State;

  (6) a request for intercept made by a taxing official under Part IV of this subtitle; and

  (7) a request for intercept made by a federal official under Part VI of this subtitle.

(b) The Comptroller shall honor vendor payment interception requests in the same order of priority provided in subsection (a) of this section for honoring income tax refund interception requests.

#### Section 13-919

(a) The Secretary of Budget and Management may adopt regulations relating to the referral of debts by State agencies to the Central Collection Unit and to the administrative procedures authorized under this part.

(b) The Comptroller may adopt regulations relating to the certification and withholding of amounts under this part.

#### Section 13-920

(a) In this part the following words have the meanings indicated.

(b) "Refund" means an individual's Maryland income tax refund or any other state's individual income tax refund.

(c) "Taxing official" means a unit or official of another state charged with the imposition, assessment, or collection of state income taxes.

#### Section 13-921

(a) Except as provided in subsection (b) of this section, a taxing official may:

  (1) certify to the Comptroller the existence of an individual's delinquent income tax liability; and

  (2) request the Comptroller to withhold any refund to which the individual is entitled.

(b) A taxing official may not certify or request the Comptroller to withhold a refund unless the laws of the taxing official's state:

  (1) allow the Comptroller to certify an income tax due;

  (2) allow the Comptroller to request the taxing official to withhold the individual's tax refund; and

  (3) provide for the payment of the refund to Maryland.

(c) The withholding of a refund shall be subject to the priorities under Sec. 13-918 of this subtitle.

#### Section 13-922

(a) A certification by a taxing official to the Comptroller shall include:

  (1) the full name and address of the individual and any other names known to be used by the individual;

  (2) the Social Security number or federal tax identification number;

  (3) the amount of the income tax liability including a detailed statement for each taxable year showing tax, interest, and penalty; and

  (4) a statement that all administrative remedies and appeals have been exhausted and that the assessment of tax, interest, and penalty has become final.

(b) The Comptroller shall determine if an individual for whom a certification is received is due a refund of Maryland income tax.

(c) As to any individual due a refund, the Comptroller shall:

  (1) notify the individual of a certification by another state of the existence of an income tax liability;

  (2) provide the individual with notice of an opportunity to request a hearing to challenge the certification; and

  (3) inform the individual that the hearing may be requested:

    (i) pursuant to Sec. 13-508 of this title; or

    (ii) with the taxing official, in accordance with the laws of the state of the taxing official.

(d) If the individual requests a hearing pursuant to Sec. 13-508 of this title, the certification of the taxing official shall be prima facie evidence of the correctness of the individual's delinquent income tax liability to the certifying state.

(e) Subject to subsection (f) of this section, the Comptroller may:

  (1) withhold any income tax refund that is due to an individual whose name has been certified by a taxing official;

  (2) pay to the other state the entire refund or the amount certified, whichever is less;

  (3) pay any income tax refund in excess of the certified amount to the individual; and

  (4) if an income tax refund is less than the certified amount, withhold amounts from subsequent income tax refunds due the individual, if the laws of the other state provide that the other state shall withhold subsequent refunds of individuals certified to that state by the Comptroller.

(f)

  (1) The Comptroller may not withhold or pay to another state an individual's income tax refund until all administrative and judicial remedies provided under Subtitle 5 of this title and Title 10 of this article have been exhausted.

  (2) If an individual filed a joint return, the Comptroller may not withhold or pay to another state the individual's income tax refund unless the certification includes both names of the individuals jointly owing income tax to the other state.

(g) After receiving a certification from a taxing official, the Comptroller shall notify the other state if the Comptroller determines that a withholding cannot be made.

#### Section 13-925

(a) In this part the following words have the meanings indicated.

(b) "Local official" means a unit or official of a political subdivision of the State charged with the imposition, assessment, or collection of taxes or other liabilities payable to the political subdivision.

(c) "Refund" means a refund of any tax imposed under Maryland law.

(d)

  (1) "Vendor payment" means any payment made by the State or by a political subdivision of the State to any person.

  (2) "Vendor payment" includes any expense reimbursement payable to an employee of the State or of a political subdivision of the State.

  (3) "Vendor payment" does not include a person's salary, wages, or pension.

#### Section 13-926

(a) Except as provided in subsection (b) of this section, a local official may:

  (1) certify to the Comptroller the existence of a person's delinquent tax liability or any other liability owed by the person to the local official's political subdivision; and

  (2) request the Comptroller to withhold any refund and vendor payment to which the person is entitled.

(b) A local official may not certify or request the Comptroller to withhold a refund or vendor payment unless the laws of the local official's political subdivision:

  (1) allow the Comptroller to certify tax due to the State;

  (2) allow the Comptroller to request the local official to withhold from any vendor payment the person's tax due to the State; and

  (3) provide for the payment of the amount withheld to the Comptroller.

(c) The withholding of a refund or vendor payment shall be subject to the priorities under Sec. 13-918 of this subtitle.

#### Section 13-927

(a) A certification by a local official to the Comptroller shall include:

  (1) the full name and address of the person and any other names known to be used by the person;

  (2) the Social Security number or federal tax identification number, if known;

  (3) the amount of the tax or other liability including:

    (i) a statement indicating the nature of the liability; and

    (ii) in the case of a liability for taxes, a detailed statement for each taxable year showing tax, interest, and penalty; and

  (4) a statement that all administrative remedies and appeals have been exhausted and that the tax or other liability has become final.

(b) The Comptroller shall determine if a person for whom a certification is received is due a refund of Maryland tax or a vendor payment.

(c) Subject to subsection (d) of this section, as to any person due a refund or vendor payment, the Comptroller shall:

  (1) withhold any refund and vendor payment that is due a person whose name has been certified by a local official;

  (2) notify the person of the amount withheld in accordance with the certification by a local official of the existence of a tax or other liability;

  (3) pay to the political subdivision the lesser of:

    (i) the entire refund and vendor payment; or

    (ii) the amount certified;

  (4) pay any refund and vendor payment in excess of the certified amount to the person; and

  (5) if the refund and vendor payment is less than the certified amount, withhold amounts from subsequent refunds and vendor payments due the person, if the laws of the political subdivision provide that the political subdivision shall withhold a vendor payment due persons certified to the political subdivision by the Comptroller.

(d) If an individual filed a joint income tax return, the Comptroller may not withhold or pay to a political subdivision the individual's income tax refund unless the certification includes both names of the individuals filing the joint income tax return.

#### Section 13-930

(a) In this part the following words have the meanings indicated.

(b) "Federal official" means a unit or official of the federal government charged with the collection of nontax liabilities payable to the federal government pursuant to 31 U.S.C. Sec. 3716.

(c) "Nontax liability due the State" means a liability certified by the Secretary of Budget and Management to the Comptroller.

(d) "Refund" means an amount described as a refund of tax under the provisions of law that authorize its payment.

(e) "Vendor payment":

  (1) means any payment, other than a refund, made by the State to any person;

  (2) includes any expense reimbursement to an employee of the State; and

  (3) does not include a person's salary, wages, or pension.

#### Section 13-931

(a) Except as provided in subsection (b) of this section, a federal official may:

  (1) certify to the Comptroller the existence of a person's delinquent nontax liability owed by the person to the federal government; and

  (2) request the Comptroller to withhold any refund and vendor payment to which the person is entitled.

(b) A federal official may certify and request the Comptroller to withhold a refund or vendor payment only if the laws of the United States:

  (1) allow the Comptroller, on behalf of the State, to certify tax and nontax liabilities due to the State;

  (2) allow the Comptroller, on behalf of the State, to enter into a reciprocal agreement with the United States, pursuant to which the federal official would be required to offset federal payments to collect delinquent debts owed to the State; and

  (3) provide for the payment of the amount withheld to the State.

(c) The Comptroller shall apply a refund or vendor payment received from a federal official according to the priorities under Sec. 13-918 of this subtitle.

#### Section 13-932

(a) A certification by a federal official to the Comptroller shall include:

  (1) the full name and address of the person and any other names known to be used by the person;

  (2) the Social Security number or federal tax identification number;

  (3) the amount of the nontax liability; and

  (4) a statement that the debt is past due and legally enforceable in the amount certified and that there are no legal barriers to collection by offset.

(b) The Comptroller shall determine if a person for whom a certification is received is due a refund of Maryland tax or a vendor payment.

(c) Subject to Sec. 13-931(b) of this subtitle and subsection (d) of this section, as to any person due a refund or vendor payment, the Comptroller shall:

  (1) withhold any refund and vendor payment that is due a person whose name has been certified by a federal official;

  (2) notify the person of the amount withheld in accordance with the certification by a federal official of the existence of a liability;

  (3) pay to the federal official the lesser of:

    (i) the entire refund and vendor payment; or

    (ii) the amount certified;

  (4) pay any refund and vendor payment in excess of the certified amount to the person; and

  (5) withhold amounts from subsequent refunds and vendor payments due the person if the initial refund and vendor payment is less than the certified amount.

(d) If an individual filed a joint income tax return and the debt certified by a federal official is not the liability of both parties to the joint income tax return, the Comptroller may not withhold or pay to the federal official that portion of the income tax refund attributable to the individual not owing the debt.

### Subtitle 10. Crimes and Offenses

#### Section 13-1001

(a) A person who is required to file an admissions and amusement tax return and who willfully fails to file the return as required under Title 4 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(b) A person who is required to file a boxing and wrestling tax return and who willfully fails to file the return as required under Title 6 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(c) A person who is required to file a financial institution tax return and who willfully fails to file the return as required under Title 8 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

(d) A person who is required to file an income tax return and who willfully fails to file the return as required under Title 10 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(e) A person, including any officer of a corporation, who is required to file a sales and use tax return and who willfully fails to file the return as required under Title 11 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(f) A person who is required to file a public service company franchise tax return and who willfully fails to file the return as required under Title 8 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

(g) A person who is required to file a digital advertising gross revenues tax return and who willfully fails to file the return as required under Title 7.5 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1002

(a) A person who willfully files a false alcoholic beverage tax return is guilty of perjury and, on conviction, is subject to the penalty for perjury.

(b) A person, including an officer of a corporation, who willfully files a false digital advertising gross revenues tax return, a false financial institution franchise tax return, a false public service company franchise tax return, or a false income tax return with the intent to evade the payment of tax due under this article is guilty of perjury and, on conviction, is subject to the penalty for perjury.

(c) Subsections (a) and (b) of this section apply to the alcoholic beverage, digital advertising gross revenues, financial institution franchise, public service company franchise, and income taxes.

#### Section 13-1003

(a) A person who is required to file an admissions and amusement tax return and who willfully makes a false statement or misleading omission on the return required under Title 4 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(b) A person who is required to file a boxing and wrestling tax return and who willfully makes a false statement or misleading omission on the return required under Title 6 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(c) A person, including an officer of a corporation, who is required to file a sales and use tax return and who willfully makes a false statement or misleading omission on the return required under Title 11 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1004

(a) An income tax return preparer who willfully prepares, assists in preparing, or causes the preparation of a false income tax return or claim for refund with fraudulent intent or the intent to evade income tax is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(b) An income tax return preparer who willfully attempts to evade any tax imposed under this article or the payment thereof is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(c)

  (1) An income tax return preparer may not willfully prepare, assist in preparing, or cause the preparation of an income tax return or claim for refund without being properly licensed or registered to provide income tax preparation services in the State.

  (2) A person who violates paragraph (1) of this subsection is guilty of a misdemeanor and on conviction is subject to a fine not exceeding $5,000 for each violation.

  (3) Each income tax return or claim for refund that an income tax preparer prepares, assists in preparing, or causes the preparation of in violation of paragraph (1) of this subsection is a separate violation.

  (4) Each fine imposed under this subsection shall be paid into the Tax Clinics for Low-Income Marylanders Fund established under Sec. 1-207 of this article.

#### Section 13-1005

(a) A person who is required to pay the admissions and amusement tax and who willfully fails to pay the tax as required under Title 4 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(b) A person who is required to pay the boxing and wrestling tax and who willfully fails to pay the tax as required under Title 6 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

#### Section 13-1006

(a) A person, including an officer of a corporation, who is required to collect the sales and use tax and who willfully fails to collect the tax as required under Title 11 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(b) A person, including an officer of a corporation, who is required to pay over the sales and use tax and who willfully fails to pay over the tax as required under Title 11 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1007

(a) A person who is required to file an income tax withholding return and who willfully fails to file the return as required under Title 10 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(b) A person who is required to withhold income tax and who willfully fails to withhold the tax as required under Title 10 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(c) A person who is required to pay over income tax and who willfully fails to pay over the tax as required under Title 10 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

(d) A person who is required to provide an income tax withholding statement under Title 10 of this article and who willfully fails to provide an income tax withholding statement or who willfully provides a false income tax withholding statement is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(e) A person who is required to file an income tax withholding certificate, under Title 10 of this article, and who willfully fails to provide information required on the withholding certificate or who willfully files a false certificate that results in the withholding of less than the required tax is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(f) An employer who fails to pay to the Comptroller salary, wages, or other compensation for personal services subject to a wage lien as required under Sec. 13-811 of this title is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

#### Section 13-1008

(a) A person who is required to pay the admissions and amusement tax and who willfully fails to keep records as required under Sec. 4-202 of this article or under admissions and amusement tax regulations is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(b) A person who is required to pay the boxing and wrestling tax and who willfully fails to keep records as required under Sec. 6-202 of this article or under boxing and wrestling tax regulations is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

(c) A person, including an officer of a corporation, who is required to keep records under Title 11 of this article or under sales and use tax regulations and who willfully fails to keep the records is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.

#### Section 13-1009

A person who participates in evading the alcoholic beverage tax is guilty of a crime and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1010

A person, including an officer of a corporation, who is required to pay the sales and use tax and who willfully evades the tax by use of a license number or exemption number that has not been issued by the Comptroller to the person using the number is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.

#### Section 13-1012

(a) A person who willfully makes, causes to be made, or procures an altered or counterfeited tobacco tax stamp in violation of Sec. 12-305 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

(b)

  (1) A person who willfully uses, transfers, or possesses an altered or counterfeited tobacco tax stamp in violation of Sec. 12-305 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

  (2) A person who uses a tobacco tax stamp more than once in violation of Sec. 12-304 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 5 years or both.

(c) A person who buys a tobacco tax stamp from a person other than the Comptroller without an authorization from the Comptroller in violation of Sec. 12-303 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.

(d) Each day that any violation under this section continues constitutes a separate offense.

#### Section 13-1013

A person who willfully possesses, transports, sells, offers for sale, or allows storage on that person's property of any alcoholic beverage that is subject to the alcoholic beverage tax and on which the tax has not been paid is guilty of a crime and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1014

(a)

  (1) A person who willfully possesses, sells, or attempts to sell unstamped or improperly stamped cigarettes in the State in violation of Title 12 of this article is guilty of a misdemeanor.

  (2) If the number of unstamped or improperly stamped cigarettes that a person possesses, sells, or attempts to sell is 30 cartons or less, the person on conviction is subject to a fine not exceeding $500 or imprisonment not exceeding 3 months or both.

  (3) If the number of unstamped or improperly stamped cigarettes that a person possesses, sells, or attempts to sell is more than 30 cartons, the person on conviction is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.

(b) A person who willfully possesses, sells, or attempts to sell other tobacco products on which the tobacco tax has not been paid in the State in violation of Title 12 of this article is guilty of a misdemeanor and on conviction is subject to a fine not exceeding $500 or imprisonment not exceeding 3 months or both.

(c) Each day that a violation under this section continues constitutes a separate offense.

#### Section 13-1015

(a) A person who willfully ships, imports, sells into or within, or transports within, this State cigarettes or other tobacco products on which the tobacco tax has not been paid in violation of Title 12 of this article or Sec. 16-219, Sec. 16-222, Sec. 16.5-215, or Sec. 16.5-216 of the Business Regulation Article is guilty of a felony and, on conviction, is subject to the penalties set forth in subsections (b) and (c) of this section.

(b)

  (1) For a first violation, a person is subject to a mandatory fine of $150 for each carton of cigarettes or each package of other tobacco products transported.

  (2) For each subsequent violation, a person is subject to a mandatory fine of $300 for each carton of cigarettes or each package of other tobacco products transported.

(c) In addition to the mandatory fine set forth in subsection (b) of this section, for a first or subsequent violation, a person may be subject to imprisonment not exceeding 2 years.

#### Section 13-1016

A person who engages in the business of a retail vendor or engages in the business of an out-of-state vendor without having obtained a license as required under Sec. 11-702 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $100.

#### Section 13-1017

A vendor who holds out to the public that the vendor will absorb or assume the sales and use tax in violation of Sec. 11-402 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 6 months or both.

#### Section 13-1018

An officer, employee, former officer, or former employee of the State, a political subdivision of the State, or a person, governmental entity, or tax compliance organization to which tax information has been disclosed in accordance with Sec. 13-203 of this title who makes a disclosure in violation of Subtitle 2 of this title is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 6 months or both.

#### Section 13-1019

Any income tax return preparer who discloses information in violation of Sec. 13-207 of this title is guilty of a misdemeanor and, on conviction, is subject to a fine of not less than $500 or more than $10,000.

#### Section 13-1020

(a) A person who violates any provision of Title 5 of this article for which there is no sanction provided, except suspension or revocation of a license or permit, is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 2 years or both.

(b) A person who violates any provision of Title 6 of this article for which there is no sanction provided is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $100.

(c) A person who violates a provision of Sec. 9-219, Sec. 9-220, or Sec. 9-221 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine of not less than $200 or more than $500.

(d) A motor carrier who violates a provision of Sec. 9-223 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 1 year or both.

#### Section 13-1021

A person who violates a regulation adopted by the Comptroller to carry out the provisions of Title 5 of this article is guilty of a crime and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1022

A person who willfully fails to take any action that the Comptroller requires under Sec. 10-804 of this article or Sec. 13-302 of this title with respect to the income tax is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $10,000 or imprisonment not exceeding 5 years or both.

#### Section 13-1023

(a) A person who negligently or without reasonable cause fails to provide any information as required under this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $500.

(b) This section does not apply to:

  (1) the alcoholic beverage tax;

  (2) the Maryland estate tax; or

  (3) the Maryland generation-skipping transfer tax.

#### Section 13-1024

(a) A person who willfully or with the intent to evade payment of a tax under this article or to prevent the collection of a tax under this article fails to provide information as required under this article or provides false or misleading information is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 18 months or both.

(b) A prosecution under this section does not bar a prosecution for perjury.

(c) This section does not apply to:

  (1) the alcoholic beverage tax;

  (2) the Maryland estate tax; or

  (3) the Maryland generation-skipping transfer tax.

#### Section 13-1025

(a) A person who assaults a tax collector who is performing an official duty is guilty of a crime and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 12 months or both.

(b) A person who assaults another person to prevent that person from bidding at a tax collector's sale or because that person bid at a tax collector's sale is guilty of a crime and, on conviction, is subject to a fine not exceeding $500 or imprisonment not exceeding 12 months or both.

#### Section 13-1026

An employee or officer of the State, a county, or a municipal corporation who negligently fails to perform a duty or to do any act required under this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000.

#### Section 13-1027

An employee or officer of the State, a county, or a municipal corporation who willfully fails to perform a duty required under this article with the intent to prevent the payment or collection of a tax under this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $5,000 or imprisonment not exceeding 2 years or both.

#### Section 13-1029

A person who violates any provision of Title 9, Subtitle 3 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment in the county jail not exceeding 6 months or both.

#### Section 13-1030

(a) A person who makes or assists another person to make a false claim for refund of motor fuel tax is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment in the county jail not exceeding 6 months or both.

(b) A person who fraudulently obtains or assists another person to fraudulently obtain a refund of motor fuel tax is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment in the county jail not exceeding 6 months or both.

#### Section 13-1031

A person who engages in the business of a dealer, a distributor, a special fuel seller, a special fuel user, or a turbine fuel seller without a license or receives, sells, or transfers motor fuel in violation of Sec. 9-337 of this article is guilty of a misdemeanor and, on conviction, is subject to a fine not exceeding $1,000 or imprisonment not exceeding 6 months or both.

### Subtitle 11. Limitations

#### Section 13-1101

(a) Except as otherwise provided in this section, an assessment of financial institution franchise tax, public service company franchise tax, income tax, or estate tax may not be made after 3 years from the later of:

  (1) the date that the return is filed; or

  (2) the date that the return is due.

(b) An assessment of digital advertising gross revenues tax, financial institution franchise tax, public service company franchise tax, income tax, or estate tax may be made at any time if:

  (1) a false return is filed with the intent to evade the tax;

  (2) a willful attempt is made to evade the tax;

  (3) a return is not filed as required under Title 7, Title 7.5, Title 8, or Title 10 of this article;

  (4) an amended estate tax return is not filed as required under Title 7 of this article;

  (5) an incomplete return is filed; or

  (6) a report of federal adjustment is not filed within the period required under Sec. 13-409 of this title.

(c) If a report of federal adjustment is filed within the time required under Sec. 13-409 of this title, the tax collector shall assess the digital advertising gross revenues tax, financial institution franchise tax, public service company franchise tax, income tax, or estate tax within 1 year after the date on which the tax collector receives the report.

(d)

  (1) Subject to the provisions of paragraph (2) of this subsection, an assessment of income tax or estate tax arising out of an amended return shall be made within 3 years after the date that the amended return is filed.

  (2) An assessment of income tax under paragraph (1) of this subsection shall be related to changes made by the amended items in the return.

#### Section 13-1102

(a) Except as provided in subsection (b) of this section, an action to recover admissions and amusement tax, boxing and wrestling tax, motor fuel tax, or sales and use tax may not be brought after 4 years from the date on which the tax is due.

(b)

  (1)

    (i) An action to recover admissions and amusement tax, boxing and wrestling tax, or sales and use tax may be brought at any time if there is proof that the tax is not paid due to fraud or gross negligence.

    (ii) An underpayment of 25% or more of the sales and use tax due is prima facie evidence of gross negligence.

  (2) An action to recover motor fuel tax may be brought at any time if there is proof that the tax is not paid due to fraud.

#### Section 13-1103

(a) Except as otherwise provided in this section, a tax imposed under this article may not be collected after 10 years from the date the tax is due.

(b) If a tax collector fails to collect a tax and a receiver or trustee is appointed within the period specified in subsection (a) of this section to complete the tax collection, the period for collecting the tax extends for 2 years from the date that the trustee or receiver is appointed.

(c)

  (1) If the assessment of any tax has been made within the period of limitations applicable to the assessment, a tax may not be collected after 10 years from the date of the assessment.

  (2) Any judgment entered may be enforced or renewed as any other judgment.

#### Section 13-1104

(a) Except as otherwise provided in this section, a claim for refund under this article may not be filed after 3 years from the date the tax, interest, or penalty was paid.

(b) A claim for refund of alcoholic beverage tax may not be filed after:

  (1) 90 days from the date of purchase or invoice of exempt alcoholic beverages used by a hospital or religious organization; and

  (2) 6 months from the date on which alcoholic beverages are condemned, lost, or rendered unmarketable.

(c)

  (1) Except as provided in paragraph (2) of this subsection, a claim for refund or credit of overpayment of financial institution franchise tax or income tax may not be filed after the periods of limitations for filing claims for refund or credit of overpayment set forth in Sec. 6511 of the Internal Revenue Code.

  (2) A claim for refund or credit of overpayment may not be filed later than 1 year from the date of:

    (i) a final adjustment report of the Internal Revenue Service; or

    (ii) a final decision of the highest court of the United States to which an appeal of a final decision of the Internal Revenue Service is taken.

  (3) Except as provided in paragraph (4) of this subsection, a refund or credit of overpayment allowed upon a claim filed under this subsection may not exceed the amount of the Maryland tax resulting from the application of the limits set forth in Sec. 6511 of the Internal Revenue Code.

  (4) A refund or credit of overpayment allowed upon a claim filed under paragraph (2) of this subsection shall be limited to the amount of the reduction in Maryland tax resulting from the federal income tax adjustment.

(d) A claim for refund of Maryland estate tax, inheritance tax, or Maryland generation-skipping transfer tax may not be filed after 3 years from the date of the event that caused the refund.

(e) A claim for refund of excess motor carrier tax credit may not be filed after 24 months following the end of the period in which the excess credit was developed.

(f) Except as provided in Sec. 13-508 of this title or for a claim under Sec. 13-901(a)(1) or (2) of this title, a claim for refund of motor fuel tax may not be filed:

  (1) after 1 year from the date of purchase;

  (2) after October 1, if the claimant elects to file an annual claim for the 12-month period ending June 30; or

  (3) for a period of less than 1 year, after 3 months following the end of the period for which the claim is filed.

(g) Except as provided in Sec. 13-508 of this title, a claim for refund of sales and use tax may not be filed after 4 years from the date the tax was paid.

(h) Except for a claim under Sec. 13-901(a)(1) or (2) of this title, a claim for refund of tobacco tax may not be filed after 1 year from the date of the event that caused the refund.

(i) A claim for refund or credit for overpayment of income tax attributable to a credit claimed under Sec. 10-703 of this article for the payment of a state tax on income paid to another state may not be filed after the later of:

  (1) the end of the limitation period otherwise prescribed under this section; or

  (2) 1 year after the date the taxpayer received notification that the other state's income tax was due.

(j) Notwithstanding subsection (c) of this section, a claim for refund or credit for overpayment of income tax attributable to a right to a reduction in a person's Maryland income tax that is established by a decision of an administrative board or by an appeal of a decision of an administrative board may be filed within 1 year after the date of a final decision of the administrative board or a final decision of the highest court to which an appeal of a final decision of the administrative board is taken.

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Md. Code Ann., Tax-Gen. (as displayed at mgaleg.maryland.gov, October 16, 2026)