# COMAR Title 03 — Comptroller of the Treasury

## Subtitle 01 — Office of the Comptroller

### Chapter 01 — General Regulations

**Authority:** General Provisions Article, §§4-201 and 4-206; State Government Article, §§10-122(a) and 10-304(b); Tax-General Article, §§2-102 and 2-103; Annotated Code of Maryland

**Administrative History:** Effective date: February 9, 1979 (6:3 Md. R. 148)

**Administrative History:** Regulation .01C, D amended effective January 31, 1983 (10:2 Md. R. 104)

**Administrative History:** Regulation .01E, F adopted effective January 31, 1983 (10:2 Md. R. 104)

**Administrative History:** Regulation .01C, D amended effective January 31, 1983 (10:2 Md. R. 104)

**Administrative History:** Chapter recodified from COMAR 03.07.01 to 03.01.01 and new Regulations .02—.04 adopted effective August 6, 1990 (17:15 Md. R. 1853)

**Administrative History:** Regulation .01 amended effective February 16, 2026 (53:3 Md. R. 121)

**Administrative History:** Regulation .01F amended effective May 2, 2022 (49:9 Md. R. 529)

**Administrative History:** Regulation .01G amended effective January 20, 1992 (19:1 Md. R. 23)

**Administrative History:** Regulation .04 repealed and new Regulation .04 adopted effective January 14, 1998 (26:1 Md. R. 19)

**Administrative History:** Regulation .04 amended effective August 19, 2013 (40:16 Md. R. 1340); May 2, 2022 (49:9 Md. R. 529)

**Administrative History:** Regulation .04A, B amended effective June 25, 2001 (28:12 Md. R. 1103)

**Administrative History:** Regulation .04B amended effective March 31, 2003 (30:6 Md. R. 418)

**Administrative History:** Regulation .04B-1 adopted effective October 9, 2006 (33:20 Md. R. 1611)

**Administrative History:** Regulation .05 adopted effective January 14, 1998 (26:1 Md. R. 19)

**Administrative History:** Regulation .06 adopted as an emergency provision effective July 1, 2003 (30:19 Md. R. 1325); emergency status extended at 30:25 Md. R. 1841; 30:26 Md. R. 1912; emergency status expired June 30, 2004

#### Regulation .01 Inspection of Public Records.

*COMAR 03.01.01.01*

A. In this regulation, “sociological information” means:

  (1) Social Security number;

  (2) Individual taxpayer identification number;

  (3) Federal employer identification number;

  (4) Personal street address;

  (5) Personal phone number;

  (6) Personal e-mail address;

  (7) Date of birth;

  (8) Information regarding marital status, dependents, or relatives;

  (9) Information regarding employment status, including employment application;

  (10) Medical or psychiatric history;

  (11) Medical assistance;

  (12) Educational history; and

  (13) Driver’s license number.

B. All public records maintained by the Comptroller, other than those which the Comptroller is authorized or required to hold confidential under the Public Information Act, the Tax-General Article, or other law, shall be open for inspection at any time during regular business hours. A person seeking the right to inspect a public record maintained by the Comptroller, other than by means of written request, who is advised by the custodian that the Comptroller is authorized or required to hold the record confidential under the Public Information Act, may pursue the request by making written application to the Comptroller of the Treasury, State Treasury Building, Annapolis, Maryland.

C. A person who makes a written request for a public record maintained by the Comptroller shall include in the request:

  (1) A statement that the request is made pursuant to the Public Information Act;

  (2) A description of the public record sought to be inspected.

D. As soon as practicable, but not later than 30 days after receipt of the written request for access to any public record, the Comptroller shall either:

  (1) Grant the request by written notice and produce the record for inspection;

  (2) Deny the request, in whole or in part; or

  (3) Temporarily deny the request pending a court determination of whether disclosure would do substantial injury to the public interest.

E. The grant of a request for public inspection includes the right to copy the public record or to have it copied by the Comptroller's Office. If the Comptroller grants a request to inspect a public record, in whole or in part, the notice mailed to the applicant shall include the date, time, and place of the inspection, and the name of the employee of the Comptroller’s office to be contacted by the applicant for this purpose.

F. If the Comptroller denies, in whole or in part, a written request for the inspection of a public record in his possession, the Comptroller shall provide the applicant, within 10 working days of the denial, with a written statement of the grounds for the denial and the remedies available to the applicant for review of his decision.

G. Any time limit set forth in this regulation:

  (1) May be extended with the consent of the applicant, for a period not to exceed 30 days; or

  (2) Shall, if the applicant seeks resolution under General Provisions Article, §4-1B-04, Annotated Code of Maryland, be extended pending the resolution of the dispute.

H. Charges for Copies, Print-Outs, Electronic Files and Photographs.

  (1) When the duplication is performed by the applicant or by an employee of the Comptroller's Office without supervision by a senior official, on conventional duplicating equipment located in an office of the Comptroller, the charge for copies or photographs of a public record provided pursuant to this regulation shall be 50 cents per page. A charge of $1 per page shall be made for copies which the Comptroller is required to make in order to delete privileged or confidential information from public records which an applicant will personally inspect and for copies which must be made under the supervision of a senior official.

  (2) If copies or photographs cannot be made on equipment located in the office where the public records are kept, the Comptroller shall cause the copies to be made at a location of the Comptroller’s choosing, and shall charge for this service, in addition to charges incurred for duplication, an amount sufficient to reimburse the State for the cost of the time of an employee of  the Comptroller’s office in supervising this copying.

  (3) If the Comptroller is required to provide a print-out or electronic file pursuant to this regulation, the Comptroller shall determine a reasonable charge for the print-out or electronic file on a case-by-case basis, taking into account computer time, programming, and material costs.

I. Except as provided in §J of this regulation, the custodian may not disclose and shall deny a request for inspection or copying of any part of a public record that contains sociological information relating to an individual.

J. Subject to §B of this regulation, a custodian may disclose sociological information:

  (1) That is anonymized and aggregated;

  (2) To other public officials and employees in the performance of their public duties;

  (3) To the person in interest or the agent or representative of the person in interest;

  (4) With the consent of the person in interest;

  (5) Pursuant to a duly issued subpoena; or

  (6) Pursuant to a court order.

#### Regulation .02 Petition for Promulgation, Amendment, or Repeal of Regulations.

*COMAR 03.01.01.02*

A. An interested person may petition the Comptroller, requesting the adoption of a new regulation under the laws administered by the Comptroller or the amendment or repeal of any existing regulation issued under these laws.

B. The petition shall be submitted in writing and shall provide:

  (1) The full text of a new proposed regulation or regulations, the codification and the full text of an existing regulation or regulations proposed to be amended, indicating proposed changes, or the codification of the regulation or regulations for which repeal is sought;

  (2) A statement in support of the proposal made, including:

    (a) Reference to the statutory basis for the proposal, including, when appropriate, judicial and administrative interpretations of the statute or statutes in question,

    (b) Specific objections to existing regulations, practices, or interpretations, and

    (c) The policy considerations which support adoption of the proposal;

  (3) A statement describing in detail the effect of the proposal on the interested person, including:

    (a) A statement as to whether the proposal is intended to affect the tax consequences of a transaction or transactions entered into or contemplated by the interested person, its vendors, customers, clients, or other persons upon whose behalf the proposal is made, the taxability of which are known by the interested person to be the subject of an inquiry, audit, refund, or assessment proceeding in the Comptroller's Office,

    (b) A statement as to whether the proposal is intended to affect the status of the interested person or other persons under any of the licensing or regulatory provisions administered by the Comptroller when it is known by the interested person that the current status of the interested person is the subject of an inquiry, inspection, investigation, or other proceeding in the Comptroller's Office, and

    (c) An explanation of the circumstances surrounding the inquiry, inspection, investigation, audit, refund, assessment, or other proceeding, if any.

C. Within 60 days after submission of a petition described in §A, above, the Comptroller shall either deny the petition in writing, stating the reasons for the denial, or initiate rule-making proceedings.

D. If a petition is denied, another petition on the same topic may not be accepted by the Comptroller for review until 6 months after the date of the denial.

#### Regulation .03 Petition for Declaratory Ruling.

*COMAR 03.01.01.03*

A. An interested person may petition the Comptroller for a declaratory ruling with respect to the applicability to a person, property, or state, of facts pertaining to the laws or the regulations administered by the Comptroller.

B. A petition for declaratory ruling shall be filed in writing, clearly marked to indicate that it is being filed pursuant to this regulation. The petition shall:

  (1) Contain a detailed statement of the facts on which the petition is based.

  (2) Set forth fully the statutes, regulations, or judicial decisions relevant to the issue.

  (3) Pose the question of whether, and in what manner, the statutes, regulations, or judicial decisions apply to the petitioner under the facts outlined in the petition.

  (4) Contain a statement describing the interest of the petitioner in making the request for the declaratory ruling. The description shall:

    (a) Include a statement as to whether the declaratory ruling sought is intended to affect the tax consequences of any transaction or transactions entered into or contemplated by the petitioner, its vendors, customers, clients, or any other person upon whose request or upon whose behalf the declaratory ruling is sought, the taxability of which are known by the petitioner to be the subject of an inquiry, audit, refund, or assessment proceeding by the Comptroller's Office;

    (b) Include a statement as to whether the declaratory ruling sought is intended to affect the status of the petitioner or any other persons under any of the licensing or regulatory provisions administered by the Comptroller when it is known by the petitioner that the current status of the petitioner is the subject of an inquiry, inspection, investigation, or other proceeding in the Comptroller's Office; and

    (c) Contain an explanation of the circumstances surrounding the inquiry, inspection, investigation, audit, refund, assessment, or other proceedings, if any.

C. The Comptroller shall consider the petition and may, at the Comptroller's discretion, issue the declaratory ruling requested. The Comptroller may require argument on the petition. A declaratory ruling issued by the Comptroller shall plainly state that it is a declaratory ruling pursuant to this regulation. A written answer from the Comptroller or any employee of the Comptroller's Office to an inquiry from a taxpayer may not be construed to be a declaratory ruling unless made in conformity with this regulation.

D. Declaratory Ruling.

  (1) As to the petitioner, a declaratory ruling shall be binding upon the Comptroller as to any transaction covered by the ruling that is entered into by a person upon whose request or upon whose behalf the declaratory ruling is sought, including a transaction entered into:

    (a) Before the date of the declaratory ruling; and

    (b) In reliance upon the ruling, unless a change in the legal basis of the declaratory ruling is made by statute, regulation, or judicial decision after the issuance of the declaratory ruling and before any affected transaction.

  (2) With prospective effect only, a declaratory ruling may be revoked, altered, or amended by the Comptroller at any time.

E. The Comptroller may publish declaratory rulings of general interest, subject to the protection of the:

  (1) Identity of the petitioner; and

  (2) Confidential information contained in the petition for declaratory ruling.

#### Regulation .04 Hearings and Appeals.

*COMAR 03.01.01.04*

A. Definitions. In this regulation, the following terms have the meanings indicated:

  (1) “Comptroller” includes any employee of the Comptroller's Office designated as a hearing officer to conduct informal hearings in contested cases.

  (2) “Person” means an individual or entity that, as a result of action taken by the Comptroller's Office, is entitled to an informal hearing by law or regulation.

  (3) “Written application” means a written request for a hearing that is submitted to the Hearings and Appeals Section of the Comptroller’s office via U.S. Mail, facsimile, email, or online appeal, or is delivered in person.

B. Hearings — Assessments and Refunds.

  (1) Assessments.

    (a) General.

      (i) A person may request a revision of an assessment by submitting a written application for a hearing to the Hearings and Appeals Section of the Comptroller's Office within 30 days of the date of the notice of assessment.

      (ii) If a person does not submit an application within the 30-day period, the assessment becomes final and not subject to appeal.

    (b) If an assessment is paid by a taxpayer, an application for refund may not be considered unless the application was made within 30 days of the date of the notice of assessment.

  (2) Refunds.

    (a) If the Comptroller denies any portion of a claim for refund, a person may appeal the denial by submitting a written application for a hearing within 30 days of the Comptroller's determination on the refund claim.

    (b) If a person does not submit an application within the 30-day period, the determination becomes final and not subject to appeal.

    (c) The withholding of a portion of an approved refund under COMAR 03.04.05 or 03.04.06 is not a denial of the claim for refund from which an appeal may be taken under this regulation. A person who disagrees with the interception of a tax refund may apply for relief as provided in COMAR 03.04.05 and 03.04.06.

    (d) If the Comptroller withholds a portion of an approved refund pursuant to Tax-General Article, §§13-921 and 13-922, Annotated Code of Maryland, a person who disagrees with the interception of a tax refund for a liability certified by the taxing official of another state may:

      (i) Submit a written application for a hearing to appeal the certification to the Hearings and Appeals Section of the Comptroller's Office within 30 days of the date of the notice of intercept; or

      (ii) Request a hearing with the taxing official of the certifying state, in accordance with the laws of the state that certified the liability.

  (3) A particular form is not required for the written application for a hearing.

B-1. Correction of Erroneous Assessments.

  (1) A person who fails to file a timely appeal under Tax-General Article, §13-508(a), Annotated Code of Maryland, may request a correction of an erroneous assessment under Tax-General Article, §13-509, Annotated Code of Maryland.

  (2) A person requesting a correction of an assessment shall provide written documentation that is relevant and responsive to the assessment, within the time period designated by the hearing officer.

  (3) After reviewing the provided documentation, the hearing officer shall:

    (a) Issue an order stating clearly the reasons for decreasing or abating the assessment; or

    (b) Send written notice of the Comptroller's refusal to enter an order.

  (4) An order issued by the hearing officer is final and not subject to appeal.

  (5) The Comptroller's refusal to issue an order is final and not subject to appeal.

C. Hearings — Licenses.

  (1) The appropriate unit of the Comptroller's Office shall schedule a hearing before the denial, suspension, or revocation of a license issued under Tax-General Article, Annotated Code of Maryland.

  (2) In the case of an alcoholic beverage license or a tobacco license issued by the Comptroller's Office, a hearing shall be held by the division responsible for issuing the license.

  (3) In the case of all other licenses issued by the Comptroller, a hearing shall be held by the Hearings and Appeals Section of the Comptroller's Office.

  (4) An appeal from a license hearing shall be under Regulation .05 of this chapter.

D. Scheduling and Attendance.

  (1) After receipt of a timely application for a hearing or after having issued a notice of proposed action on a license or license application, the Comptroller shall schedule a hearing.

  (2) The Comptroller shall notify the person:

    (a) Of the date, time, and place of the hearing;

    (b) Of the statutory or regulatory authority for the Comptroller's action or proposed action;

    (c) In the case of a proposed action on a license or license application, of the facts which may warrant the action;

    (d) That the person may present witnesses and documents at the hearing;

    (e) That failure to appear for the scheduled hearing shall be treated as a withdrawal of the request for a hearing; and

    (f) If the hearing is by telephone, video, or other electronic means, of instructions on how to appear for the hearing.

  (3) Postponements.

    (a) The hearing officer shall consider a request for postponement only if the person establishes good cause for the postponement.

    (b) Except as provided in §D(3)(d) of this regulation, a request for postponement shall be made in writing and be received by the Comptroller no fewer than 5 business days before the scheduled hearing.

    (c) The hearing officer may require documentation of the reasons for the postponement request from the person.

    (d) Emergency Request for Postponement.

      (i) For purposes of this paragraph, “emergency” means a sudden, unforeseen occurrence requiring immediate attention which arises within 5 business days of the hearing.

      (ii) In an emergency, a request for postponement may be made by telephone.

      (iii) The hearing officer may require documentation of the reasons for the emergency postponement request from the person.

  (4) Failure to Attend Hearing.

    (a) If a person fails to attend a scheduled hearing in person or, in the case of a telephone, video, or other electronic hearing, fails to appear as instructed, the assessment or denial of the application for refund is final and not subject to appeal.

    (b) If a person fails to attend a scheduled hearing on a proposed action on a license or application for license, the proposed action becomes effective as of the date of the scheduled hearing.

    (c) If a person fails to attend a scheduled hearing to challenge the certification of a liability owed to another state which resulted in the withholding of a portion of refund, the certification is deemed correct and the intercept is final and not subject to appeal.

E. Prehearing Procedure.

  (1) Before a hearing, the hearing officer may:

    (a) Review or request materials relevant to the proceedings; and

    (b) Hold a prehearing conference.

  (2) If all parties agree at a prehearing conference, a hearing officer may dispose of an issue by stipulation or settlement.

F. Hearings.

  (1) Procedures.

    (a) The Comptroller shall record all hearings.

    (b) A person may produce witnesses and documents in support of the person's position.

    (c) Subpoenas.

      (i) A person may request that the hearing officer subpoena witnesses.

      (ii) A person shall make the request in writing, not later than 10 days before the hearing, explaining why the subpoena is necessary.

      (iii) The hearing officer may decline to issue the subpoena.

    (d) The hearing officer may question any witnesses and may produce, by subpoena or otherwise, additional witnesses. A person may question any witnesses called by the hearing officer.

    (e) The hearing officer may allow a person time to provide additional evidence or written arguments, and may reconvene the hearing if the hearing officer considers it necessary.

    (f) The hearing officer may consult with any employee of the Comptroller and with the person before making a decision in a case.

  (2) Evidence.

    (a) The hearing officer shall consider probative evidence without regard to any technical rules, but may reject evidence which is incompetent, irrelevant, immaterial, unduly repetitious, or not responsive.

    (b) Copies of documents may be admitted, although the hearing officer may require production of originals.

    (c) The Comptroller shall retain documentary or other evidence for at least 60 days after the case is finally resolved. The evidence may then be destroyed unless the owner or person producing it makes a written request for its return.

  (3) Witnesses shall be under oath or affirmation.

  (4) Burden of Proof.

    (a) An assessment or denial of refund is presumed to be correct, and a person has the burden of proving that an error has been made.

    (b) In a hearing on a license suspension, revocation, or denial, the Comptroller has the burden of proof.

    (c) In a hearing on the certification of a liability owed to another state which resulted in the withholding of a portion of refund, the certification of the taxing official of the other state is presumed to be correct, and a person has the burden of proving that an error has been made.

  (5) Hearings Conducted by Electronic Means.

    (a) A hearing officer may conduct all or part of a hearing by telephone, video conferencing, or other electronic means, by the consent of all parties.

    (b) All substantive and procedural rights applicable to hearings described in this regulation apply to telephone, video, or other electronic hearings, subject only to the limitations of the physical arrangement.

    (c) Documentary Evidence. For a telephone, video, or other electronic hearing, a party shall provide documentary evidence to be offered to all parties so that it is received by each party and the hearing officer at least 5 days before the scheduled hearing.

    (d) Default. For a telephone, video, or other electronic hearing, the following may be considered a failure to appear resulting in the assessment or denial of the application for refund becoming final and not subject to appeal:

      (i) Failure to answer the telephone for 15 minutes;

      (ii) Failure to free the telephone for a hearing;

      (iii) Failure to call into a hearing held by telephone, video, or other electronic means within 15 minutes of the scheduled time for hearing; or

      (iv) Any other failure without good cause to be ready to proceed with the hearing as scheduled.

G. Final Determinations.

  (1) The hearing officer shall issue a written final determination on behalf of the Comptroller.

  (2) The notice of final determination shall summarize:

    (a) Any adjustments to the assessment or refund denial and the reasons for the Comptroller's action;

    (b) In the case of an action on a license or application for a license, the reasons for the Comptroller's action; or

    (c) In the case of the withholding of a portion of a refund for a liability certified by the taxing official of another state, any adjustment to the amount of the intercepted refund and the reasons for the Comptroller’s action.

H. Appeals.

  (1) A person dissatisfied with the final determination may appeal to the Maryland Tax Court for a de novo review within 30 days from the date of the notice of final determination.

  (2) If the Comptroller does not issue a final determination with respect to a claim for refund within 6 months from the date of the filing of the claim, the person may elect to consider the claim disallowed and appeal to the Maryland Tax Court.

  (3) Effect of Appeals.

    (a) Assessments.

      (i) Proceedings for the review of assessments do not stay the accumulation of statutory interest charges.

      (ii) A person may pay an assessment under protest to avoid incurring additional interest charges during the appeal process.

      (iii) If a person pays an assessment under protest, and it is subsequently determined that all or a portion of the tax is not owed to the Comptroller, the Comptroller shall pay interest as provided in Tax-General Article, §13-603, Annotated Code of Maryland.

    (b) Licenses. The filing of a petition of appeal from a final determination does not, of itself, stay the enforcement of the Comptroller's proposed action.

#### Regulation .05 Hearings Under the Administrative Procedure Act.

*COMAR 03.01.01.05*

A. A person who, as a result of an action of the Comptroller, is entitled to a hearing in accordance with State Government Article, Title 10, Subtitle 02, Annotated Code of Maryland, may request a hearing.

B. The request for a hearing shall be made as set forth in Regulation .04 of this chapter.

C. To the extent practicable and as permitted by law, the provisions set forth in Regulation .04 of this chapter apply to hearings under this regulation.

D. The Comptroller shall hold a hearing in accordance with the provisions in State Government Article, Title 10, Subtitle 02, Annotated Code of Maryland.

E. A person aggrieved by the Comptroller's final determination may file a petition for judicial review in accordance with the provisions of State Government Article, §10-222, Annotated Code of Maryland.

### Chapter 02 — Tax Payments — Immediately Available Funds

**Authority:** Tax-General Article, §§2-103, 13-104, and 13-105, Annotated Code of Maryland

**Administrative History:** Effective date: April 26, 1993 (20:8 Md. R. 722)

**Administrative History:** Regulation .01B amended effective January 14, 1999 (26:1 Md. R. 19); November 10, 2003 (30:22 Md. R. 1577); March 27, 2017 (44:6 Md. R. 324)

**Administrative History:** Regulation .02 amended effective January 14, 1999 (26:1 Md. R. 19)

**Administrative History:** Regulation .02 amended as an emergency provision effective July 1, 2003 (30:15 Md. R. 989); amended permanently effective November 10, 2003 (30:22 Md. R. 1577)

**Administrative History:** Regulation .02 amended effective March 27, 2017 (44:6 Md. R. 324)

**Administrative History:** Regulation .02A amended effective February 9, 2009 (36:3 Md. R. 207)

**Administrative History:** Regulation .02A, B amended effective February 27, 1995 (22:4 Md. R. 235)

**Administrative History:** Regulation .02A, B amended as an emergency provision effective July 1, 2003 (30:15 Md. R. 989)

**Administrative History:** Regulation .02C amended effective May 13, 2002 (29:9 Md. R. 744); April 30, 2012 (39:8 Md. R. 533)

**Administrative History:** Regulation .02F amended effective March 31, 2014 (41:6 Md. R. 377)

**Administrative History:** Regulation .02I adopted effective April 30, 2012 (39:8 Md. R. 533)

**Administrative History:** Regulation .02G amended as an emergency provision effective July 1, 2003 (30:15 Md. R. 989); emergency status expired December 31, 2003

**Administrative History:** Regulation .04A amended effective February 27, 1995 (22:4 Md. R. 235)

**Administrative History:** Regulation .04B amended as an emergency provision effective July 1, 2003 (30:15 Md. R. 989)

**Administrative History:** Regulation .04B amended and D adopted effective November 10, 2003 (30:22 Md. R. 1577)

**Administrative History:** Regulation .05 amended as an emergency provision effective July 1, 2003 (30:15 Md. R. 989)

**Administrative History:** Regulation .05 amended effective November 10, 2003 (30:22 Md. R. 1577)

**Administrative History:** Regulation .05A amended effective February 27, 1995 (22:4 Md. R. 235)

**Administrative History:** Regulation .05A, B amended effective January 14, 1999 (26:1 Md. R. 19); March 21, 2011 (38:6 Md. R. 393); April 30, 2012 (39:8 Md. R. 533); March 31, 2014 (41:6 Md. R. 377); May 2, 2022 (49:9 Md. R.  529)

#### Regulation .01 Definitions.

*COMAR 03.01.02.01*

A. In this chapter, the following terms have the meanings indicated.

B. Terms Defined.

  (1) “ACH credit” means a transaction in which a taxpayer, through the taxpayer's bank and an automated clearing house, originates an entry crediting the State of Maryland's bank account and debiting the taxpayer's bank account for the amount of the payment due.

  (2) “ACH debit” means a transaction in which the Treasurer, through a designated depository bank and an automated clearing house, originates an entry debiting the taxpayer's bank account and crediting Maryland's bank account for the amount of the payment due.

  (3) “Automated clearing house (ACH)” means a central clearing facility operated by:

    (a) A federal reserve bank; or

    (b) An organization established by agreement with the National Automated Clearing House Association (NACHA) which:

      (i) Operates as a clearing house for transmitting or receiving entries between banks and bank accounts, and

      (ii) Authorizes an electronic transfer of funds between banks or bank accounts.

  (4) “Business day” means the hours between 8 a.m. and 8 p.m. prevailing Eastern time, on a day other than a Saturday, Sunday, or any holiday as defined in Tax-General Article, §1-201(a), Annotated Code of Maryland.

  (5) “Comptroller” means the Comptroller of Maryland or the Comptroller's designee.

  (6) “Direct debit” means an electronic transfer of an authorized payment from a taxpayer's checking or savings account into the State's bank account.

  (7) “Immediately available funds” means an ACH credit, an ACH debit, direct debit, or wire transfer.

  (8) “Person” means an individual, receiver, trustee, guardian, personal representative, fiduciary, or representative of any kind, including an agent of a taxpayer, and any partnership, firm, association, corporation, or other entity.

  (9) “Tax” means tax, interest, penalty, and fees.

  (10) “Taxpayer” means any person required to pay a tax or file a return or a report.

  (11) “TXP” means the tax payment addendum convention for use with the National Automated Clearing House Association's CCD+ application.

  (12) “Wire transfer” means a transaction in which a taxpayer, through the taxpayer's bank, originates an entry crediting the State of Maryland's bank account and debiting the taxpayer's bank account on the same day the transaction is initiated.

#### Regulation .02 Requirements for Payment by Immediately Available Funds.

*COMAR 03.01.02.02*

A. A taxpayer whose unpaid tax liability is $10,000 or more shall remit payment by immediately available funds pursuant to the following:

  (1) Except as provided for in §A(2) of this regulation, payment shall be made by using:

    (a) ACH credit;

    (b) ACH debit; or

    (c) Direct debit;

  (2) Payment by wire transfer may be used if the taxpayer:

    (a) Initiates an ACH credit or authorizes an ACH debit transaction which fails; and

    (b) Receives prior approval from the Comptroller.

B. An agent of a taxpayer or taxpayers shall remit payment by immediately available funds under §A of this regulation if the total amount of the payments to be made by the agent for any period exceeds $10,000 in the aggregate, not including any amounts for which the agent has not received timely payment from the taxpayer.

C. Payment by immediately available funds applies to the payment of:

  (1) Income tax withheld by an employer;

  (2) Corporation income tax;

  (3) Except as provided for in §H of this regulation, sales and use tax;

  (4) Motor fuel tax;

  (5) Motor carrier tax;

  (6) Alcoholic beverage tax; or

  (7) Tobacco tax.

D. A person using the ACH debit or credit method shall provide:

  (1) The taxpayer's Maryland tax account number; and

  (2) A statement of the type of tax and the tax period for which the payment is being made.

E. A person using the direct debit method shall provide:

  (1) The taxpayer's federal employer identification number;

  (2) The taxpayer's Maryland tax account number;

  (3) The tax type and tax period for which the payment is being made; and

  (4) Any additional information required to accurately report the tax due.

F. A separate ACH credit, ACH debit, direct debit, or wire transfer as allowed under §A(2) of this regulation shall be made for each type of tax and for each period for which the tax is due.

G. A taxpayer not required to remit payments in immediately available funds may use the ACH credit, ACH debit, or direct debit method for tax payments. The wire transfer method is permitted only if the taxpayer receives prior approval from the Comptroller.

H. A taxpayer may not make payment using ACH credit for the payment of sales and use tax on sales of alcoholic beverages.

#### Regulation .03 Registration.

*COMAR 03.01.02.03*

A person making a payment by ACH debit, or as an agent for a taxpayer, may be required to register with the Comptroller before initiation of an ACH tax payment.

#### Regulation .04 Rules for Use of ACH and Direct Debit Payments.

*COMAR 03.01.02.04*

A. General Rule. A taxpayer using the ACH payment method shall make the appropriate arrangements to initiate the payment at least one business day before the due date so that the transfer is executed on the date payment is due.

B. Specific Rules for ACH Debit.

  (1) A taxpayer using the ACH debit payment method shall make the appropriate arrangements to initiate the payment by 2 p.m. on the last banking day before the due date.

  (2) The taxpayer shall furnish to the Comptroller the banking information necessary to generate ACH debits against the taxpayer's designated account.

  (3) If a taxpayer elects the ACH debit payment method and the banking information necessary to generate the ACH debit against the taxpayer's account changes, the taxpayer shall provide the new banking information to the Comptroller 30 days before initiating an ACH transaction.

  (4) The taxpayer, to initiate payment of a tax, shall contact the Comptroller and report the tax information in accordance with Regulation .02D of this chapter.

C. Specific Rules for ACH Credit.

  (1) A taxpayer electing the ACH credit payment method shall initiate each payment of tax by contacting the taxpayer's own financial institution and requesting the institution to transfer both the appropriate identifying information and payment to the State of Maryland's depository bank by an ACH credit.

  (2) The taxpayer shall remit an ACH credit transaction with an addendum record formatted in accordance with the appropriate TXP convention.

D. Specific Rules for Direct Debit.

  (1) The direct debit method is only available for:

    (a) Income tax withheld by an employer; and

    (b) Sales and use tax.

  (2) The taxpayer shall furnish to the Comptroller the banking information necessary to generate the direct debit against the taxpayer's designated account.

  (3) The taxpayer, to initiate payment of a tax, shall log on to the bFile (business online filing) program on the Comptroller's website or onto an approved third-party website and provide the tax information in accordance with the prompts and instructions and with Regulation .02E of this chapter.

#### Regulation .05 Miscellaneous Filing and Reporting Provisions.

*COMAR 03.01.02.05*

A. A person making a tax payment using the ACH credit, ACH debit, direct debit, or wire transfer method shall file the following returns:

  (1) For Maryland individual income tax withholding:

    (a) Annual Employer Withholding Reconciliation Return using Form MW508;

    (b) Amended Annual Employer Withholding Reconciliation Return on Form MW508A; and

    (c) Amended Employer’s Return of Income Tax Withheld using Form MW506A or for accelerated filers using Form MW506AM;

  (2) Maryland Corporation Income Tax Return Form 500; or

  (3) For Maryland motor fuel-related taxes:

    (a) Dealer Tax Return Form GTD100 and all applicable supporting schedules and worksheets;

    (b) Special Fuel User/Seller Tax Return Form GTD-300 and all applicable supporting schedules and worksheets;

    (c) Special Return—Jet Fuel and Aviation Gas Return Form GTD-AV and all applicable supporting schedules and worksheets; and

    (d) Class W Distributor Return Form GTD-100W.

B. A person making tax payments using the ACH credit, ACH debit, direct debit, or wire transfer method may not file the corresponding returns or reports if the payment was for any of the following:

  (1) Employer’s Return of Income Tax Withheld Form MW506 or for accelerated filers Form MW506M;

  (2) The Declaration of Estimated Corporation Income Tax Form 500D;

  (3) Maryland Application for Extension of Time to File Corporation Income Tax Return Form 500E; or

  (4) Sales and Use Tax Return Form 202 or Form 202F.

C. A taxpayer who remits taxes by ACH credit, ACH debit, direct debit, or wire transfer method shall indicate that fact on all returns required to be filed for that period for which payment is being made as listed under §A of this regulation.

#### Regulation .06 Payment of Delinquent Taxes by Immediately Available Funds.

*COMAR 03.01.02.06*

The Comptroller may require a taxpayer having a delinquent unpaid tax liability to remit the unpaid taxes by immediately available funds regardless of the amount of the delinquent unpaid tax for:

A. Income tax withheld by an employer;

B. Corporation income tax; or

C. Sales and use tax.

### Chapter 03 — Record-Keeping Requirements for Records Created by Computer and Electronic Systems

**Authority:** Tax-General Article, §2-103, Annotated Code of Maryland

**Administrative History:** Effective date: September 7, 1998 (25:18 Md. R. 1434)

#### Regulation .01 Purpose.

*COMAR 03.01.03.01*

The purpose of this chapter is to serve as a supplement to the requirements imposed on taxpayers for the maintenance and retention of books, records, and other sources of information under COMAR 03.02.02.03, 03.02.03.04, 03.03.01.05, 03.03.01.06—.07, 03.03.04.04, and 03.06.03.02. This chapter addresses the situation where all or a part of the taxpayer's records are received, created, maintained, or generated through various computer, electronic, and imaging processes and systems.

#### Regulation .02 Definitions.

*COMAR 03.01.03.02*

A. In this chapter, the following terms have the meanings indicated.

B. Terms Defined.

  (1) “Electronic data interchange” or “EDI technology” means the computer-to-computer exchange of business transactions in a standardized structured electronic format.

  (2) “Hard copy” means any documents, records, reports, or other data printed on paper.

  (3) Machine-Sensible Record.

    (a) “Machine-sensible record” means a collection of related information in an electronic format.

    (b) “Machine-sensible record” does not include hard-copy records that are created or recorded on paper or stored in or by an imaging system such as microfilm, microfiche, or storage-only imaging systems.

  (4) Storage-Only Imaging System.

    (a) “Storage-only imaging system” means a system of computer hardware and software that provides for the storage, retention, and retrieval of documents originally created on paper.

    (b) “Storage-only imaging system” does not include any system, or part of a system, that manipulates or processes information or data contained on the document in any manner other than to reproduce the document in hard copy or as an optical image.

#### Regulation .03 Record-Keeping Requirements—General.

*COMAR 03.01.03.03*

A. If a taxpayer retains records required to be retained by the Comptroller in both machine-sensible and hard-copy formats, the taxpayer shall make the records available to the Comptroller in both formats upon request of the Comptroller.

B. Notwithstanding the requirement in §A of this regulation, a taxpayer may not be prohibited from demonstrating tax compliance with traditional hard-copy documents.

#### Regulation .04 Record-Keeping Requirements—Machine-Sensible Records.

*COMAR 03.01.03.04*

A. General Requirements.

  (1) Machine-sensible records used to establish tax compliance shall contain sufficient transaction-level detail information so that the details underlying the machine-sensible records can be identified and made available to the Comptroller.

  (2) At the time of an examination, the retained machine-sensible records shall be capable of being retrieved and converted to a standard record format.

  (3) A taxpayer who does not create the electronic equivalent of a traditional paper document in the ordinary course of business is not required to construct that record for tax purposes.

B. Electronic Data Interchange Requirements.

  (1) If a taxpayer uses electronic data interchange processes and technology, the level of record detail, in combination with other records related to the transactions, shall be equivalent to that contained in an acceptable paper record. For example, the retained records shall contain such information as vendor name, invoice date, product description, quantity purchased, price, amount of tax, indication of tax status, and shipping detail. Codes may be used to identify some or all of the data elements, if the taxpayer provides a method which allows the Comptroller to interpret the coded information.

  (2) The taxpayer may capture the information necessary to satisfy §B(1) of this regulation at any level within the accounting system and need not retain the original electronic data interchange transaction records if the audit trail, authenticity, and integrity of the retained records can be established.

C. Business Process Information.

  (1) Upon the request of the Comptroller, the taxpayer shall provide a description of the business process that created the retained records. The description shall include the relationship between the records and the tax documents prepared by the taxpayer and the measures employed to ensure the integrity of the records.

  (2) The taxpayer shall be capable of demonstrating the:

    (a) Functions being performed as they relate to the flow of data through the system;

    (b) Internal controls used to ensure accurate and reliable processing; and

    (c) Internal controls used to prevent unauthorized addition, alteration, or deletion of retained records.

  (3) The following specific documentation is required for machine-sensible records retained pursuant to this regulation:

    (a) Record formats or layouts;

    (b) Field definitions, including the meaning of all codes used to represent information;

    (c) File descriptions, for example, data set name; and

    (d) Detailed charts of accounts and account descriptions.

#### Regulation .05 Records Maintenance Requirements.

*COMAR 03.01.03.05*

The taxpayer's computer hardware or software shall accommodate the extraction and conversion of retained machine-sensible records.

#### Regulation .06 Access to Machine-Sensible Records.

*COMAR 03.01.03.06*

The taxpayer shall provide the Comptroller access to machine-sensible records in one or more of the following manners:

A. The taxpayer may arrange to provide the Comptroller, either directly or through a third party, with the hardware, software, and personnel resources to access the machine-sensible records;

B. The taxpayer may convert the machine-sensible records to a standard record format specified by the Comptroller, including copies of files, on a magnetic medium that is agreed to by the Comptroller; or

C. The taxpayer and the Comptroller may agree on other means of providing access to the machine-sensible records taking into account the taxpayer's facts and circumstances.

#### Regulation .07 Taxpayer Responsibility.

*COMAR 03.01.03.07*

A taxpayer may contract with a third party to provide custodial or management services of the records. This contract does not relieve the taxpayer of its responsibilities under this chapter.

#### Regulation .08 Alternative Storage Media.

*COMAR 03.01.03.08*

A. For purposes of storage and retention, a taxpayer may:

  (1) Convert hard-copy documents, received or produced in the normal course of business and required to be retained, to microfilm, microfiche, or other storage-only imaging systems; and

  (2) After a 3-month period, discard the original hard-copy documents, if the conditions of §B of this regulation are met.

B. Requirements.

  (1) Microfilm, microfiche, and other storage-only imaging systems shall meet the requirements of this regulation.

  (2) Documentation establishing the procedures for converting the hard-copy documents to microfilm, microfiche, or other storage-only imaging system shall be maintained and made available on request. The documentation shall, at a minimum, contain a sufficient description to allow an original document to be followed through the conversion system as well as internal procedures established for inspection and quality assurance.

  (3) A taxpayer shall establish procedures for the effective identification, processing, storage, and preservation of the stored documents and for making them available for the period they are required to be retained.

  (4) A taxpayer shall provide adequate facilities and equipment for reading, locating, and reproducing any documents maintained on microfilm, microfiche, or other storage-only imaging system so that records may be reviewed in a prompt and efficient manner.

  (5) When displayed on storage-only imaging equipment or reproduced on paper, the documents shall exhibit a high degree of legibility and readability. For this purpose, legibility is defined as the quality of a letter or numeral that enables the observer to identify it positively and quickly to the exclusion of all other letters or numerals. Readability is defined as the quality of a group of letters or numerals being recognizable as words or complete numbers.

  (6) All data stored on microfilm, microfiche, or other storage-only imaging systems shall be maintained and arranged in a manner that permits the prompt and efficient location of a particular record.

C. The Comptroller is under no obligation to use records stored on microfilm, microfiche, or other storage-only imaging system if there is evidence that it lacks authenticity or integrity or does not meet the requirements set forth in §B of this regulation.

#### Regulation .09 Effect On Hard-Copy Record-Keeping Requirements.

*COMAR 03.01.03.09*

A. Except as otherwise provided in this chapter, this chapter does not relieve taxpayers of the responsibility to retain hard-copy records that are created or received in the ordinary course of business, as required by existing law and regulations.

B. If hard-copy records are not produced or received in the ordinary course of transacting business, for example, when the taxpayer uses electronic data interchange technology, hard-copy records need not be created.

C. Hard-copy records generated at the time of a transaction using a credit or debit card shall be retained unless all the details necessary to determine correct tax liability relating to the transaction are subsequently received and retained by the taxpayer in accordance with this chapter. These details include those listed in Regulation .04B(1) of this chapter.

D. This regulation does not prevent the Comptroller from requesting hard-copy printouts in lieu of retained machine-sensible records at the time of examination.

#### Regulation .10 Records Retention—Time Period.

*COMAR 03.01.03.10*

Records required to be retained under this chapter shall be preserved for the same time period as all other records are required to be kept for the applicable tax.

### Chapter 04 — Nonresident Contractor

*Repealed*

**Administrative History:** Effective date: May 24, 2004 (31:10 Md. R. 794)

**Administrative History:** Regulations .01—.09 repealed effective August 18, 2014 (41:16 Md. R. 944)

### Chapter 05 — Private Letter Rulings

**Authority:** State Government Article, §10-122(a); Tax-General Article, §§2-102, 2-103, and 13-1A-05; Annotated Code of Maryland

**Administrative History:** Effective date: January 8, 2024 (50:26 Md. R. 1131)

#### Regulation .01 Definitions.

*COMAR 03.01.05.01*

A. In this chapter, the following terms have the meanings indicated.

B. Terms Defined.

  (1) “Authorized representative” means an attorney, agent, or person designated by a petitioner to represent the petitioner in a petition for a private letter ruling.

  (2) “Person” means:

    (a) An individual, receiver, trustee, guardian, personal representative, fiduciary, or representative of any kind;

    (b) Any partnership, firm, association, corporation, or other entity; and

    (c) A governmental entity or a unit or instrumentality of a governmental entity.

  (3) “Petition” means a written request for a private letter ruling that is submitted to the Legal Division of the Comptroller’s Office by first-class mail, postage prepaid, or electronically or is delivered in person.

  (4) Petitioner.

    (a) “Petitioner” means a person who is requesting a private letter ruling.

    (b) “Petitioner” does not include a class or group of persons who are not related parties in a specific and actual prospective transaction.

  (5) “Private letter ruling” means a final, written, non-appealable determination:

    (a) Applicable to a specific set of facts;

    (b) Submitted in a written petition under this chapter; and

    (c) Issued by the Comptroller of Maryland on:

      (i) The application of tax law administered by the Comptroller under Tax-General Article, Annotated Code of Maryland;

      (ii) The application of regulations under this title to a specific set of facts; and

      (iii) Other matters over which the Comptroller has administrative authority.

  (6) “Tax” means those State and local taxes and fees administered by the Comptroller.

#### Regulation .02 General.

*COMAR 03.01.05.02*

A. A private letter ruling is binding on the Comptroller for a period of 7 years from the date the private letter ruling is issued unless void, modified, or revoked in accordance with the provisions of Regulation .07 of this chapter.

B. A private letter ruling is a determination of the Comptroller only as to the transaction that is the subject of the ruling.

C. A petitioner is not bound by a private letter ruling.

D. A petitioner’s failure to follow a private letter ruling may be considered in determining whether interest and penalty should be reduced or abated for reasonable cause in any subsequent challenge of an assessment or denial of a refund on the issue covered by the private letter ruling.

E. A private letter ruling may be used as evidence of a petitioner’s knowledge or intent in a subsequent proceeding.

F. The Comptroller may use information submitted in a petition for a private letter ruling for subsequent audit purposes.

#### Regulation .03 Petition for Private Letter Ruling.

*COMAR 03.01.05.03*

A. A petition for private letter ruling shall be submitted with respect to a specific party and a specific, actual, and prospective transaction or situation.

B. A petition for private letter ruling may be submitted by either:

  (1) A person who is a party to the subject transaction; or

  (2) An authorized representative on behalf of a party to the subject transaction.

EXAMPLE: The president of a trade association may submit a petition for private letter ruling on the taxability of a transaction contemplated by the trade association, such as whether a prospective purchase by the non-profit trade association is exempt from sales and use tax.

C. A petition for private letter ruling may not be submitted by:

  (1) A group of persons that are not related parties in the subject transaction, or a person acting on their behalf;

  (2) A person that is not a party to the subject transaction;

  (3) A person that is not an authorized representative of the party to the subject transaction; or

  (4) An anonymous or hypothetical party.

EXAMPLE: The president of a trade association may not submit a petition for private letter ruling on the taxability of a type of transaction that some or all its members are contemplating, because the trade association is not itself a party to the transaction and does not represent any party to the transaction in the transaction.

D. A petition for private letter ruling shall be submitted in the form and manner required by the Comptroller. The petition shall:

  (1) Identify the petitioner and all parties involved in the transaction or question;

  (2) Contain a concise statement of the question or issue on which the petition is based;

  (3) Contain a detailed statement of the facts on which the petition is based;

  (4) Contain a redacted or anonymized version of the statement of facts upon which the petition is based, which may be published under Regulation .06 of this chapter;

  (5) Identify all statutes, regulations, judicial decisions, or other published federal or state guidance relevant to the petition, including authority adverse to the petitioner’s position;

  (6) Include a discussion of whether, and in what manner, the statutes, regulations, judicial decisions, and other published federal or state guidance apply to the petitioner under the facts outlined in the petition;

  (7) Contain a description of the petitioner’s interest in the private letter ruling, which shall include:

    (a) A statement as to whether the private letter ruling sought is intended to affect the tax consequences of any transaction or transactions entered into or contemplated by the petitioner, its vendors, customers, clients, or any other person who is a party to the transaction described in the petition, which are known by the petitioner to be the subject of a Comptroller inquiry, audit, refund, or assessment proceeding or any inquiry, audit, refund, or assessment proceeding conducted on behalf of and with the approval of the Comptroller;

    (b) A statement as to whether the private letter ruling sought is intended to affect the petitioner’s status under any of the licensing, regulatory, or statutory provisions administered by the Comptroller, which is known by the petitioner to be the subject of an inquiry, inspection, investigation, audit, refund request, voluntary disclosure, or other proceeding in the Comptroller’s Office; and

    (c) An explanation of the circumstances surrounding the inquiry, audit, refund, assessment, inspection, investigation, or other proceedings, if any;

  (8) Contain a statement as to whether the petitioner has sought or is seeking a private letter ruling or other guidance from the Internal Revenue Service, another state, or another taxing authority on the transaction or question that is the subject of its petition for a private letter ruling to the Comptroller of Maryland and, if so, from what other state or taxing authority;

  (9) Contain, if the petitioner asserts a position or alternative positions, a concise proposed draft ruling;

  (10) Contain the signature of the petitioner or the petitioner’s authorized representative; and

  (11) Include, if the petition is submitted by an authorized representative, a completed Maryland Form 548 Power of Attorney.

#### Regulation .04 Requests for Additional Information.

*COMAR 03.01.05.04*

A. At any time before a private letter ruling is issued, the Comptroller may request additional information from a petitioner.

B. Additional information may include:

  (1) Statements or other information required by Regulation .03 of this chapter;

  (2) Documents or supporting information;

  (3) Specific facts about the issue or transaction that is the subject of the petition; or

  (4) Clarification of statements of facts submitted to the Comptroller as part of the request for a private letter ruling.

C. The petitioner shall submit the information to the Comptroller within 30 days after the date of the Comptroller’s request for additional information. The Comptroller’s request for additional information shall state the date on which the additional information is due and the manner of submission of the information.

D. If a petitioner fails to timely submit the additional information requested by the Comptroller, the Comptroller may deny the petition for private letter ruling.

E. The Comptroller may reopen a petition for private letter ruling denied under §D of this regulation if, within 12 months after the denial of the petition, the petitioner:

  (1) Submits the additional information requested by Comptroller; and

  (2) Affirms that there have been no material changes to the facts submitted in the petition for private letter ruling.

#### Regulation .05 Withdrawals and Denials of Petitions.

*COMAR 03.01.05.05*

A. Petitioner may withdraw the petition for private letter ruling at any time before the private letter ruling is issued.

B. Denial of Petition for Private Letter Ruling. The Comptroller may deny a petition for private letter ruling for good cause, including:

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

  (2) The petitioner did not timely submit additional information requested by the Comptroller under Regulation .04 of this chapter.

  (3) The issue identified in the petition is:

    (a) Under extensive study or review; or

    (b) Currently being considered in a rule-making procedure, contested case, or any other agency or judicial proceeding that may resolve the issue;

  (4) The Comptroller has reason to believe the issue is the subject of an examination, audit, or pending refund request of the petitioner for the same or a prior tax period;

  (5) The petition for private letter ruling does not identify the taxpayer or taxpayers;

  (6) The petition involves a hypothetical situation or alternative plans;

  (7) The transaction for which the petition for private letter ruling is submitted is designed to avoid taxation;

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

  (9) The petition seeks to determine whether a statute is constitutional under the Maryland Constitution or the United States Constitution;

  (10) The issue is addressed by statute, regulation, or Court decision; or

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

C. If the Comptroller denies a petition for private letter ruling under this section, the Comptroller shall notify the petitioner in writing of the reason for the denial within 60 days of the date on which the petition was submitted to the Comptroller.

#### Regulation .06 Issuance and Publication of Private Letter Ruling.

*COMAR 03.01.05.06*

A. A private letter ruling shall be issued to the petitioner in writing.

B. Publication.

  (1) The Comptroller shall publish periodically on the Comptroller’s website redacted or anonymized copies of private letter rulings the Comptroller determines may be of interest to the public.

  (2) The Comptroller, in its sole discretion, shall determine whether to publish a private letter ruling.

  (3) A published private letter ruling is not binding on the Comptroller as to any person other than the petitioner who requested the private letter ruling.

  (4) Published private letter rulings may be relied upon by the public as informal guidance.

  (5) If the Comptroller intends to publish a private letter ruling, the Comptroller shall provide, at least 15 business days prior to publication, a redacted or anonymized draft for publication of the private letter ruling to the petitioner or the petitioner’s authorized representative.

  (6) In the draft for publication, the Comptroller shall redact or anonymize identifying details, trade secrets, commercial or financial information considered privileged, and any information that would constitute an unwarranted invasion of personal privacy.

  (7) The draft for publication shall retain information sufficient to provide meaningful guidance to the public.

  (8) Within 15 business days of the date the draft of the private letter ruling intended for publication is sent to petitioner, the petitioner may submit revisions to the proposed draft for publication of the anonymized or redacted information, if any, to the Comptroller.

  (9) Failure of the petitioner to submit proposed revisions within 15 business days shall be deemed a waiver of any claim that the version for publication contains confidential information.

  (10) The Comptroller shall respond to petitioner’s proposed revisions of the anonymized or redacted private letter ruling before publication.

  (11) The Comptroller shall consider the petitioner’s proposed redactions to the draft intended for publication; however, the Comptroller, in its sole discretion, shall determine the contents of the published private letter ruling.

#### Regulation .07 Status of Private Letter Rulings.

*COMAR 03.01.05.07*

A. Effect and Non-Appealability.

  (1) A private letter ruling becomes binding on the Comptroller on the date it is issued.

  (2) A private letter ruling is binding on the Comptroller for 7 years from the date it is issued, unless the private letter ruling is void or is modified or revoked under this regulation.

  (3) A private letter ruling may not be appealed to the Comptroller’s Hearings and Appeals Division, the Maryland Tax Court, any other administrative agency or tribunal, or any State or federal court.

B. Void Private Letter Rulings.

  (1) A private letter ruling is void and of no effect from the date it is issued if:

    (a) The petition contains a misstatement or omission of material facts in the petition; or

    (b) The facts are determined to be materially different from the representations on which the void private letter ruling was based.

  (2) A void private letter ruling is not binding on the Comptroller.

  (3) Penalty and interest shall be applied to any tax owed but not remitted in reliance on a private letter ruling that is void, and it shall not be a defense to the assessment of any tax, interest, or penalty that the petitioner relied on the private letter ruling in not paying the tax.

  (4) The Comptroller may consider a misstatement, omission, or misrepresentation of material facts, whether made by the petitioner or the petitioner’s authorized representative, that voids a private letter ruling to indicate fraud.

C. Modification or Revocation of Private Letter Rulings

  (1) A private letter ruling is of no force or effect, and no longer binds the Comptroller, automatically upon a material change in fact, or as of the effective date of a change in any statute, regulation or rule, or the issuance of a final decision in a contested case on which the private letter ruling relies.

  (2) A petitioner may request a written modification or revocation of a private letter ruling. A request for modification or revocation of a private letter ruling shall:

    (a) Be submitted in writing;

    (b) Include a detailed description of the basis for the modification or revocation request; and

    (c) Conform to the requirements of Regulation .03 of this chapter.

  (3) The Comptroller may modify or revoke a private letter ruling if the Comptroller determines that a material change in facts or a change in law, regulations, rules, or a final decision in a contested case affects the validity of the private letter ruling. When modifying a private letter ruling, the Comptroller shall notify the petitioner in writing of the modified private letter ruling.

  (4) A modified or revoked private letter ruling does not apply to any period that predates the date the material change in facts occurred, or that predates the date of the change in law, regulations, rules, or final decision in a contested case that resulted in the modification or revocation of the private letter ruling.

D. Renewal of Private Letter Ruling.

  (1) A petitioner may request a renewal of a private letter ruling no earlier than 6 months before the expiration of the private letter ruling.

  (2) A request for renewal of a private letter ruling shall:

    (a) Be submitted in writing;

    (b) Include a detailed description of the basis for the renewal, including:

      (i) A statement that no material facts have changed; and

      (ii) A statement that no law, regulation, rule, or decision in a contested case affects the validity of the private letter ruling.

  (3) The Comptroller may deny a request for renewal of a private letter ruling:

    (a) If the Comptroller, in its sole discretion, determines that:

      (i) Material facts have changed; or

      (ii) There has been a change in law, regulation, rule, or final decision in a contested case that affects the validity of the private letter ruling; or

    (b) For any of the reasons listed in Regulation .05B of this chapter.

E. Expiration of Private Letter Ruling.

  (1) Unless renewed, a private letter ruling automatically expires as to the petitioner 7 years from the date the private letter ruling is issued.

  (2) An expired private letter ruling is not binding on the Comptroller.

  (3) An expired private letter ruling may be used as evidence of petitioner’s knowledge or intent in a subsequent proceeding.