<subtitle num="01" heading="Assessment Administration"> <chapter num="01" heading="Assessment Reduction"> <regulation prefix="Regulation" num=".01" heading="Relief."> <text>The following regulations apply:</text> <paragraph num="A."> <text>If it is apparent that a mechanical or clerical error was made in the calculation of the assessment, the assessment is adjusted.</text> </paragraph> <paragraph num="B."> <text>On the date of finality, if the assessment office was unaware of the existence of a condition affecting value, the assessment may be adjusted.</text> </paragraph> <paragraph num="C."> <text>If the basis for a request for reduction is a difference of opinion or a difference in valuation judgment, relief is denied.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 8-419, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> </annotations> </chapter> <chapter num="02" heading="Appeal Hearings"> <regulation prefix="Regulation" num=".01" heading="Definition."> <paragraph num="A."> <text>In this chapter, the following term has the meaning indicated.</text> </paragraph> <paragraph num="B."> <text>Term Defined. “Good cause” means:</text> <paragraph num="(1)"> <text>A serious medical or health condition experienced by the property owner or the property owner's agent which prevents a scheduled departmental appeal hearing from being conducted; or</text> </paragraph> <paragraph num="(2)"> <text>Any other extraordinary circumstance which prevents a scheduled departmental appeal hearing from being conducted.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Postponements."> <paragraph num="A."> <text>Upon request of the property owner or the property owner's agent, a scheduled departmental appeal hearing will be postponed one time without cause.</text> </paragraph> <paragraph num="B."> <text>Any additional postponements will be granted only for good cause.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Proof of Representation for Real Property Assessment Appeals."> <paragraph num="A."> <text>An appeal filed by a representative on behalf of a property owner or taxpayer shall include proper authorization from the property owner or taxpayer to pursue the appeal.</text> </paragraph> <paragraph num="B."> <text>The authorization required by §A of this regulation shall be in writing and filed no later than:</text> <paragraph num="(1)"> <text>45 days from the date of the notice if the appeal is submitted pursuant to Tax-Property Article, §14-502(a)(1), Annotated Code of Maryland;</text> </paragraph> <paragraph num="(2)"> <text>60 days after the date the property transfers if the appeal is submitted pursuant to Tax-Property Article, §14-502(a)(2), Annotated Code of Maryland; or</text> </paragraph> <paragraph num="(3)"> <text>On or before the date of finality for the next taxable year if the appeal is submitted pursuant to Tax-Property Article, §14-503, Annotated Code of Maryland.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The failure to provide timely authorization as required by §B of this regulation will result in an appeal hearing being set up exclusively for the property owner or taxpayer and all future correspondence being directed to the property owner or taxpayer.</text> </paragraph> <paragraph num="D."> <text>If timely authorization is not provided as required by §B of this regulation and a property owner or taxpayer wants to be represented at a scheduled appeal hearing, proper authorization shall be received by the Department on or before the assigned hearing date.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§1-402, 2-201, and 2-202, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: October 6, 1997 (24:20 Md. R. 1405)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 adopted effective April 29, 2024 (51:8 Md. R. 368)</annotation> </annotations> </chapter> <chapter num="03" heading="Public Information Requests"> <regulation prefix="Regulation" num=".01" heading="Fees."> <paragraph num="A."> <text>The following fees shall be charged when the Department is requested to provide a copy of public records:</text> <paragraph num="(1)"> <text>For an applicant's own real property worksheet and sales analysis, no charge;</text> </paragraph> <paragraph num="(2)"> <text>For real property worksheets of comparable properties where the applicant has an active appeal as provided in Tax-Property Article, §14-201(c), Annotated Code of Maryland, $1.00 per worksheet;</text> </paragraph> <paragraph num="(3)"> <text>For business entity records, the fee set by Corporations and Associations Article, Title 1, Annotated Code of Maryland; and</text> </paragraph> <paragraph num="(4)"> <text>For all other records, no charge for the first three pages, $1.00 for four pages and 25 cents for each page beyond four.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The fee for searching and preparing a public record is:</text> <paragraph num="(1)"> <text>No charge for the first 2 hours of work; and</text> </paragraph> <paragraph num="(2)"> <text>After the first 2 hours, a charge reasonably related to the hourly rate of the employee performing the search and preparation.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 2-202; State Government Article, §10-621; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: November 26, 2001 (28:23 Md. R. 2055)</annotation> </annotations> </chapter> </subtitle> <subtitle num="02" heading="Real Property Assessments"> <chapter num="01" heading="General"> <regulation prefix="Regulation" num=".01" heading="Ownership and Classification."> <paragraph num="A."> <text>In the case of separate ownership of land and buildings (or other improvements), the buildings shall be assessed to the owner of the land.</text> </paragraph> <paragraph num="B."> <text>In the case of joint ownership, only a single assessment and billing to all joint owners shall be made for their undivided interests in the single parcel of real property. This includes parcels held by cotenants, joint tenants as well as by tenants by the entireties.</text> </paragraph> <paragraph num="C."> <text>All structures shall be considered real estate unless they are considered to be personal property. Personal property is property not generally affixed to or a part of the real estate. In deciding whether an item is personal property or real estate one should consider the manner in which it is affixed, the intention of the party who made the affixation, and the purpose for which the premises is used.</text> </paragraph> <paragraph num="D."> <text>Owner of Record. Immediate family includes spouse, son, daughter, father, mother, sister, brother, grandmother, grandfather, son-in-law, daughter-in-law, father-in-law, mother-in-law, and grandchildren.</text> </paragraph> <paragraph num="E."> <text>In the case of property subject to a time-share instrument under Real Property Article, Title 11A, Annotated Code of Maryland, notices of assessment shall be sent to the managing entity as defined in §11A-109 of that article.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Taxable Status."> <paragraph num="A."> <text>Classification of Structure.</text> <paragraph num="(1)"> <text>Structures, other than those specified in §A(3) of this regulation, used for the purpose of housing, storing, or protection of grain or other commodity from the elements, shall be classified as real property and assessed accordingly.</text> </paragraph> <paragraph num="(2)"> <text>Nothing in this section may be construed to classify structures as personal property where equipment or machinery is installed to maintain a suitable climate or temperature necessary to the preservation of the stored grain or commodity.</text> </paragraph> <paragraph num="(3)"> <text>Structures including the equipment or machinery used in the cleaning, drying, processing, mixing, and blending of grain or other commodities used exclusively for the processing operation of the grain or other commodity, shall be classified as personal property and assessed accordingly.</text> </paragraph> <paragraph num="(4)"> <text>Machinery and equipment (aeration equipment, auger loading and unloading tubes) installed in the structures referred to in §A(3) of this regulation shall be classified as personal property and assess accordingly.</text> </paragraph> </paragraph> <paragraph num="B."> <text>This same determination is extended to include all types of storage tanks, including oil tanks, chemical tanks, and any other structure built for the purpose of storing a product. These tanks should be considered real property and assessed accordingly.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 5-101, and 8-234, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01E adopted effective July 29, 1985 (12:15 Md. R. 1525)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02C amended effective September 19, 1988 (15:19 Md. R. 2248)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02C repealed effective January 14, 1999 (26:1 Md. R. 24)</annotation> </annotations> </chapter> <chapter num="02" heading="Valuation"> <regulation prefix="Regulation" num=".01" heading="Residential Land."> <text>Lot value includes site improvements such as well, septic system, water, sewer, landscaping, and driveway. A lot without site improvements should first be valued as if the lot had site improvements and then the assessor should deduct for the absence of site improvements by either percentage or dollar amounts.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Solar Energy."> <text>If a structure is built to house a solar heating or cooling unit, there may not be additional assessment for these structures. If this structure has a dual use such as storage, only the value attributable to the use other than solar heating and cooling shall be assessed.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Subdivided Land — Bulk Ownership of Lots."> <text>The valuation of subdivided land should consider each lot as a single legal entity regardless of ownership.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Substantially Completed Improvements."> <text>When real property is revalued because substantially completed improvements have been made adding at least the statutory minimum in value to the property under Tax-Property Article, §8-104, Annotated Code of Maryland, both the land and improvements shall be revalued on the date of finality, the semiannual date of finality, or quarterly date of finality following the substantial completion.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 8-104, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 repealed and new Regulation .01 adopted effective March 11, 1996 (23:5 Md. R. 382)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 adopted effective September 9, 1996 (23:18 Md. R. 1318)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended effective December 23, 2013 (40:25 Md. R. 2070)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 adopted effective October 16, 2000 (27:20 Md. R. 1841)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 repealed effective November 5, 2018 (45:22 Md. R. 1027)</annotation> </annotations> </chapter> <chapter num="03" heading="Agricultural Use Assessments"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Actively used land” means land that is actually and primarily used for a continuing farm or agricultural use.</text> </paragraph> <paragraph num="(2)"> <text>“Actually devoted land” means that portion of actively used land which is engaged in an approved agricultural activity.</text> </paragraph> <paragraph num="(3)"> <text>“Agricultural land unit (ALU)” means the combination, for the purpose of qualifying for agricultural use assessment, of not more than three parcels of land located in the same county and under the same ownership.</text> </paragraph> <paragraph num="(4)"> <text>“Approved agricultural activity” means those activities recognized as agricultural pursuits under Regulation .03 of this chapter.</text> </paragraph> <paragraph num="(5)"> <text>“Associated land” means that portion of actively used land which is not actually devoted land but is located on the same parcel as actually devoted land, including woodland under Regulation .06A—C of this chapter, and other vacant land which is devoted to passive use.</text> </paragraph> <paragraph num="(6)"> <text>“FCMA” means a forest conservation and management agreement under Tax-Property Article, §8-211, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(7)"> <text>“Gross income” means the actual income that is received in a calendar year that results directly from the farm or agricultural use of the land.</text> </paragraph> <paragraph num="(8)"> <text>“Parcel” means a piece of land of any size in one ownership.</text> </paragraph> <paragraph num="(9)"> <text>“Ratio requirement” means the ratio of associated land to actually devoted land which determines the total amount of actively used land eligible for agricultural use assessment.</text> </paragraph> <paragraph num="(10)"> <text>“Same ownership” means, in terms of the ownership of two or more parcels, that at least one common name appears as grantee in all deeds to those parcels.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Criteria to Be Considered."> <text>The following criteria shall be considered in determining whether land that appears to be actively used is in fact actively used and qualifies for agricultural use assessment under Tax-Property Article, §8-209, Annotated Code of Maryland:</text> <paragraph num="A."> <text>Zoning applicable to the land, in particular if land is zoned to a more intensive use than is permitted under agricultural zoning;</text> </paragraph> <paragraph num="B."> <text>Present and past use of the land;</text> </paragraph> <paragraph num="C."> <text>Participation in governmental or private agricultural programs;</text> </paragraph> <paragraph num="D."> <text>Extent of production for sale of plants, timber, livestock, and food for human and animal consumption;</text> </paragraph> <paragraph num="E."> <text>Size of the parcel or parcels farmed, in particular, whether the size is economically compatible with the agricultural use to which the land is devoted;</text> </paragraph> <paragraph num="F."> <text>Amount of acreage in crops, pasture, and woodland;</text> </paragraph> <paragraph num="G."> <text>Amount of livestock or poultry;</text> </paragraph> <paragraph num="H."> <text>Inventory of farm buildings and equipment and condition of same;</text> </paragraph> <paragraph num="I."> <text>Marketing of the land as evidenced by multiple sales of parcels out of a tract;</text> </paragraph> <paragraph num="J."> <text>Ratio of associated land to actually devoted land; and</text> </paragraph> <paragraph num="K."> <text>The gross income that is derived from the agricultural activity on the land.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Approved Agricultural Activities."> <paragraph num="A."> <text>Approved agricultural activities are as follows:</text> <paragraph num="(1)"> <text>Raising grains, fruit, herbs, melons, mushrooms, nuts, seeds, tobacco, or vegetables;</text> </paragraph> <paragraph num="(2)"> <text>Raising poultry, for example, chicken, turkeys, or eggs;</text> </paragraph> <paragraph num="(3)"> <text>Dairy, for example, milking cows;</text> </paragraph> <paragraph num="(4)"> <text>Raising livestock, for example, cattle, sheep, lambs, hogs, or pigs;</text> </paragraph> <paragraph num="(5)"> <text>Horse boarding, breeding, or training;</text> </paragraph> <paragraph num="(6)"> <text>Turf farming;</text> </paragraph> <paragraph num="(7)"> <text>Ornamental horticulture with the raising and marketing of ornamental trees, shrubs, plants, and flowers, including aquatic plants;</text> </paragraph> <paragraph num="(8)"> <text>Aquaculture with the raising and marketing of aquatic organisms such as fish and shellfish; and</text> </paragraph> <paragraph num="(9)"> <text>Silviculture, as defined in Regulation .06 A(4) or (5) of this chapter.</text> </paragraph> </paragraph> <paragraph num="B."> <text>An activity not listed in §A of this regulation may be recognized as an approved agricultural activity at the discretion of the Department.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Parcels of 20 acres or more — Ratio Requirements."> <paragraph num="A."> <text>The ratio requirements are established by regions as follows:</text> <paragraph num="(1)"> <text>Western region—Garrett, Allegany, and Washington counties, 10:1;</text> </paragraph> <paragraph num="(2)"> <text>Central region—all counties on the western shore of Maryland, except Harford County and those listed in §A(1) of this regulation, 5:1; and</text> </paragraph> <paragraph num="(3)"> <text>Eastern region—all counties on the eastern shore of Maryland, and Harford County, 10:1.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Only Class 3 land under Regulation .08 of this chapter may be used in developing the ratio requirement.</text> </paragraph> <paragraph num="C."> <text>Five acres or more must be actually devoted land.</text> </paragraph> <paragraph num="D."> <text>Examples of Ratio Requirements.</text> <paragraph num="(1)"> <text>A taxpayer owns a 401-acre parcel in the western region (10:1 ratio). None of the land is Class 1 or Class 2 land under Regulation .08 of this chapter. Twenty acres are actually devoted. There is a 1-acre homesite. The amount of actively used land eligible for agricultural use assessment is 220 acres, calculated as follows:</text> </paragraph> <paragraph num="(2)"> <text>A taxpayer owns a 400-acre parcel of vacant, passively used land. Because there is no actually devoted land, a ratio requirement cannot be met and no land qualifies for agricultural use assessment.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Parcels of Less Than 20 Acres — Use Test vs. Income Test."> <paragraph num="A."> <text>A parcel of land or ALU less than 20 acres but greater than or equal to 3 acres shall receive agricultural use assessment if its meets one of the following tests:</text> <paragraph num="(1)"> <text>If at least 3 acres but less than 5 acres are actually devoted and $2,500 gross income is derived from the approved agricultural activities; or</text> </paragraph> <paragraph num="(2)"> <text>If at least 5 acres but less than 20 acres are actually devoted, the land qualifies for agricultural use assessment regardless of gross income.</text> </paragraph> </paragraph> <paragraph num="B."> <text>A parcel of land or ALU of less than 3 acres excluding the homesite shall receive the agricultural use assessment if it meets one of the following tests:</text> <paragraph num="(1)"> <text>Gross income from the approved agricultural activity on the land:</text> <paragraph num="(a)"> <text>Generates a minimum of $2500; and</text> </paragraph> <paragraph num="(b)"> <text>Amounts to at least 51 percent of the owner’s total gross income:</text> <paragraph num="(i)"> <text>The owner’s total gross income shall include all sources of income for the calendar year that immediately precedes the taxable year, whether or not the income is included in the definition of gross income for federal or State tax purposes;</text> </paragraph> <paragraph num="(ii)"> <text>This income shall include any benefit under the Social Security Act or Railroad Retirement Act;</text> </paragraph> <paragraph num="(iii)"> <text>No more than 2 parcels of land may qualify under the same ownership;</text> </paragraph> </paragraph> </paragraph> <paragraph num="(2)"> <text>A family farm unit as defined in Tax Property Article, §8-209(g)(1)(iv), Annotated Code of Maryland; or</text> </paragraph> <paragraph num="(3)"> <text>A parcel of land under the same ownership and contiguous to a parcel of land receiving agricultural use assessment and is actively used. No more than 2 parcels of land may qualify under the same ownership.</text> </paragraph> </paragraph> <paragraph num="C."> <text>Different approved agricultural activities may be combined to meet the requirements of §§A and B of this regulation.</text> </paragraph> <paragraph num="D."> <text>The Department may determine the reasonableness of gross income claimed by an owner.</text> </paragraph> <paragraph num="E."> <text>The ratio requirements under Regulation .04 of this chapter are used to establish the associated lands.</text> </paragraph> <paragraph num="F."> <text>Only Class 3 land under Regulation .08 of this chapter will be used in developing ratio requirements.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Woodland."> <paragraph num="A."> <text>A woodland parcel of 5 acres or more shall receive agricultural use assessment only if it is:</text> <paragraph num="(1)"> <text>A part of a parcel of land which is determined to be actively used as defined in Regulation .01B(1) of this chapter:</text> </paragraph> <paragraph num="(2)"> <text>A parcel contiguous to a parcel qualifying for agricultural use assessment provided both parcels are in the same ownership;</text> </paragraph> <paragraph num="(3)"> <text>A parcel separated from a parcel of land which qualifies for agricultural use assessment, provided both parcels were purchased at the same time by the same owner;</text> </paragraph> <paragraph num="(4)"> <text>Subject to and in compliance with a forestry management plan prepared by a registered professional forester;</text> </paragraph> <paragraph num="(5)"> <text>Subject to and in compliance with an FCMA; or</text> </paragraph> <paragraph num="(6)"> <text>Actually devoted land as defined in Regulation .01B(2) of this chapter.</text> </paragraph> </paragraph> <paragraph num="B."> <text>A woodland parcel less than 5 acres cannot be combined with another woodland parcel to establish an agricultural land unit as defined in Regulation .01B(3) of this chapter in order to meet the minimum parcel size of 5 acres.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Homesites."> <paragraph num="A."> <text>Except as provided in §B of this regulation, for each dwelling house located on a parcel for which agricultural use assessment is determined applicable, a minimum of 1 acre shall be designated as homesite and assessed at fair market value. If the amount of land serving the dwelling house as homesite exceeds 1 acre, that greater amount of acreage shall be assessed at fair market value.</text> </paragraph> <paragraph num="B."> <text>When a dwelling is located on a parcel under an FCMA of less than 6 acres, the Department may adjust the size of the homesite.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".08" heading="Agricultural Use Value Rates."> <text>The following ranges govern the valuation and assessment of land eligible for agricultural use assessment, based on the capitalization of Statewide farmland rentals:</text> <text>Use Value/Assessment Class 1 FCMA land $125 per acre/$125 per acre Class 2 Land under a private woodland management plan $187.50 per acre/$187.50 per acre Class 3 Other eligible land $125—$500 per acre/$125—$500 per acre</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§ 2-201, 2-202, and 8-209, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective November 17, 1986 (13:23 Md. R. 2481); December 5, 1994 (21:24 Md. R. 1990)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03A amended effective February 16, 2026 (53:3 Md. R. 123)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended effective January 20, 2014 (41:1 Md. R. 13)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective May 25, 2026 (53:10 Md. R. 455l90p[9)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05D, E adopted effective January 24, 2022 (49:2 Md. R. 78)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06 amended effective February 16, 2026 (53:3 Md. R. 123)</annotation> <annotation type="History" subtype="Administrative History">Regulation .08 amended effective October 16, 2000 (27:20 Md. R. 1841)</annotation> </annotations> </chapter> <chapter num="04" heading="Additions for Medical Necessity"> <regulation prefix="Regulation" num=".01" heading="Application and Attestation."> <paragraph num="A."> <text>Application shall be made on form number RP-1, which may be obtained from local assessment offices.</text> </paragraph> <paragraph num="B."> <text>The application shall be prepared by the physician of the property owner and signed attesting that the improvements were needed for medical reasons and that the person resides in the residence.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Qualification."> <paragraph num="A."> <text>Sufficient evidence of medical necessity is required and must be attested to by a physician for the improvement made. Determination will be made on a case-by-case basis.</text> </paragraph> <paragraph num="B."> <text>Credit may not be given for any improvement that is not a specific addition to the value of the property and valued for assessment purposes.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 8-233, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01A amended effective September 19, 1988 (15:19 Md. R. 2248)</annotation> </annotations> </chapter> <chapter num="05" heading="Country Clubs"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Family” means those individuals recognized by a country club's or golf course's organizational documents as being in a member's family, but does not include more individuals than those listed in COMAR 18.02.01.01D.</text> </paragraph> <paragraph num="(2)"> <text>“General public” means those individuals or organizations using a country club's or golf course's facilities who are not:</text> <paragraph num="(a)"> <text>Members;</text> </paragraph> <paragraph num="(b)"> <text>A member's family;</text> </paragraph> <paragraph num="(c)"> <text>A member's guests; or;</text> </paragraph> <paragraph num="(d)"> <text>Employees of the club or course.</text> </paragraph> </paragraph> <paragraph num="(3)"> <text>“Guests” means those individuals recognized by a country club's or golf course's organizational documents as being a member's guest, subject to the following:</text> <paragraph num="(a)"> <text>When club or course facilities are used by a group of eight individuals or less and one of the group is a member or family who pays for the use of the facilities, then any individual in the group who is not a member or family is considered a guest;</text> </paragraph> <paragraph num="(b)"> <text>When club or course facilities are used by a group of more than eight individuals at least 75 percent of whom are members or family, the other individuals are considered guests;</text> </paragraph> <paragraph num="(c)"> <text>When a club's or course's facilities are used by a group of more than eight individuals and the activity serves a personal, social, or business purpose directly benefiting a member, family, or employer of a member and is paid for by either the member or the employer, the individuals who are not members or family are considered guests.</text> </paragraph> </paragraph> <paragraph num="(4)"> <text>“Members” means those individuals or organizations recognized by a country club's or golf course's organizational documents as belonging to the club or course, including their spouses.</text> </paragraph> <paragraph num="(5)"> <text>“Primarily used” for a country club means:</text> <paragraph num="(a)"> <text>At least 50 percent of the use of the club facility must be by members, family, or guests; and</text> </paragraph> <paragraph num="(b)"> <text>Not more than 49 percent of the use of that facility may be by the general public.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>“Primarily used” for a golf course means:</text> <paragraph num="(a)"> <text>At least 50 percent of the use of the course facility must be by the general public; and</text> </paragraph> <paragraph num="(b)"> <text>Not more than 49 percent of the use of that facility may be by members, family, or guests.</text> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Qualification."> <paragraph num="A."> <text>For a country club to qualify for a country club agreement the:</text> <paragraph num="(1)"> <text>Club must be located on at least 50 acres of land maintaining a regular or championship golf course of at least 9 holes and a clubhouse;</text> </paragraph> <paragraph num="(2)"> <text>Golfing facilities within the area covered by the agreement must be primarily used by members, family, or guests;</text> </paragraph> <paragraph num="(3)"> <text>Dining, ballroom, and meeting facilities within the area covered by the agreement must be primarily used by members, family, or guests;</text> </paragraph> <paragraph num="(4)"> <text>Other club facilities within the area covered by the agreement must be primarily used by members, family, or guests;</text> </paragraph> <paragraph num="(5)"> <text>Club shall submit the Department's application before the commencement of the agreement and each renewal term; and</text> </paragraph> <paragraph num="(6)"> <text>Club shall submit the Department's questionnaire before the commencement of the agreement and each renewal term, and at other times the Department requires.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Except for the golf course, the clubhouse, and a minimum of 50 acres of land, any club facility that is not primarily used by members, family, or guests may be excluded from an agreement.</text> </paragraph> <paragraph num="C."> <text>For a golf course to qualify for a golf course agreement the:</text> <paragraph num="(1)"> <text>Course shall be located on at least 50 acres of land maintaining a regular or championship golf course of at least nine holes;</text> </paragraph> <paragraph num="(2)"> <text>Golfing facilities within the area covered by the agreement shall be primarily used by the general public;</text> </paragraph> <paragraph num="(3)"> <text>Other course facilities within the area covered by the agreement shall be primarily used by the general public in connection with the use of the golf facilities;</text> </paragraph> <paragraph num="(4)"> <text>Course shall submit the Department's application before the commencement of the agreement and each renewal term; and</text> </paragraph> <paragraph num="(5)"> <text>Course shall submit the Department's application questionnaire before the commencement of the agreement and each renewal term, and at other times the Department requires.</text> </paragraph> </paragraph> <paragraph num="D."> <text>Except for the golf course and a minimum of 50 acres of land, any course facility which is not primarily used by the general public in connection with the use of the golf facilities may be excluded from an agreement.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Percentage Use — Country Clubs."> <paragraph num="A."> <text>The percentage use of golfing facilities is determined by comparing the number of rounds played by members, family, and guests and by the general public with the total number of rounds played at the club.</text> </paragraph> <paragraph num="B."> <text>The percentage use of the dining, ballroom, and meeting facilities is determined by comparing the income generated by general public use with the total income attributed by the club to the use of those facilities.</text> </paragraph> <paragraph num="C."> <text>The percentage use of all other club facilities is determined by comparing the use by the members, family, and guests and the use by the general public with the total use of those facilities.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Percentage Use — Golf Courses."> <paragraph num="A."> <text>The percentage use of golfing facilities is determined by comparing the number of rounds played by members, family, and guests and the number of rounds played by the general public with the total number of rounds played on the course.</text> </paragraph> <paragraph num="B."> <text>The percentage use of any dining, ballroom, and meeting facilities is determined by comparing the:</text> <paragraph num="(1)"> <text>Income generated by member, family, and guest use connected with the use of the golfing facilities;</text> </paragraph> <paragraph num="(2)"> <text>Income generated by all use of those facilities that is also connected with the use of the golf facilities; and</text> </paragraph> <paragraph num="(3)"> <text>Total income generated by all use of those facilities.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The percentage use of all other club facilities is determined by comparing the use by the general public connected with the use of the golf facilities and the use by members, family, and guests connected with the use of the golf facilities with the total use of those facilities.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Application."> <paragraph num="A."> <text>The Department shall provide an application and questionnaire relative to a country club or golf course agreement.</text> </paragraph> <paragraph num="B."> <text>The application shall set forth the requirements for a country club or golf course use valuation.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Valuation — Use Value."> <paragraph num="A."> <text>Land values shall be based upon Tax-Property Article, §8-213, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Course improvements such as tees, greens, fairways, and similar items shall be based upon the cost of these improvements less applicable depreciation.</text> </paragraph> <paragraph num="C."> <text>Any land and improvements that are not devoted to country club or golf course use shall be valued at market value.</text> </paragraph> <paragraph num="D."> <text>The land used as a country club or golf course clubhouse site shall be valued at use value.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Notices."> <text>When country club or golf course land is reassessed according to its use value, country club or golf course land shall also be valued according to its market value. If the market value exceeds the use value, the owner shall be notified of both values.</text> </regulation> <regulation prefix="Regulation" num=".08" heading="Termination of Agreement."> <text>After an agreement terminates, dual use and market valuations cease, and the market valuation is effective for the subsequent tax year.</text> </regulation> <regulation prefix="Regulation" num=".09" heading="Termination by Club or Course Prohibited."> <paragraph num="A."> <text>Except as otherwise provided in this regulation, when a country club or golf course makes an agreement with the Department under Tax-Property Article, §8-213(b), Annotated Code of Maryland, it may not terminate the agreement during its original term or any extension of the term, as provided by Tax-Property Article, §8-213(d), Annotated Code of Maryland, without the written consent of the Department.</text> </paragraph> <paragraph num="B."> <text>A country club or golf course may not enter into or continue an agreement if it:</text> <paragraph num="(1)"> <text>Allows or practices discrimination under Tax-Property Article, §8-214, Annotated Code of Maryland;</text> </paragraph> <paragraph num="(2)"> <text>Fails to meet the qualifications for a country club or golf course under Tax-Property Article, §8-212, Annotated Code of Maryland; or</text> </paragraph> <paragraph num="(3)"> <text>Fails to meet the qualifications under Regulation .02 of this chapter.</text> </paragraph> </paragraph> <paragraph num="C."> <text>Land may not continue under an agreement if it:</text> <paragraph num="(1)"> <text>Is conveyed to a new owner who does not accept the obligation of an agreement pursuant to Tax-Property Article, §8-217, Annotated Code of Maryland;</text> </paragraph> <paragraph num="(2)"> <text>Ceases to be used as a country club and is not immediately subjected to a golf course agreement; or</text> </paragraph> <paragraph num="(3)"> <text>Ceases to be used as a golf course and is not immediately subjected to a country club agreement.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 8-213, 8-218, and 8-219, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended and Regulations .02—.04 adopted effective March 11, 1996 (23:5 Md. R. 382)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective October 19, 1998 (25:21 Md. R. 1575)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05A amended effective May 26, 2003 (30:10 Md. R. 668)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05B amended effective April 15, 2002 (29:7 Md. R. 622)</annotation> <annotation type="History" subtype="Administrative History">Regulation .08C amended effective May 26, 2003 (30:10 Md. R. 668)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective March 15, 2004 (31:5 Md. R. 451)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06A amended effective January 24, 2022 (49:2 Md. R. 78)</annotation> </annotations> </chapter> <chapter num="06" heading="Assessor Inspections"> <regulation prefix="Regulation" num=".01" heading="Procedures."> <paragraph num="A."> <text>Except as otherwise provided in this regulation, “inspection” means an exterior physical inspection of real property for the purpose of determining the condition and attributes of real property and verifying the measurements of any improvements to land.</text> </paragraph> <paragraph num="B."> <text>Only one inspection of a real property shall be made in a 3-year cycle, as provided in the Tax-Property Article, §8-104(b), Annotated Code of Maryland, unless an assessor determines an additional inspection is necessary.</text> </paragraph> <paragraph num="C."> <text>Inspection Procedure.</text> <paragraph num="(1)"> <text>Except as provided in §C(2) of this regulation, an assessor shall conduct an inspection according to the following procedure:</text> <paragraph num="(a)"> <text>The assessor shall determine if a person is physically present on the real property. If a person is physically present on the real property, the assessor shall attempt to communicate with that person, stating the assessor's name, occupation, and the purpose of the inspection. If the person indicates that an inspection may not be permitted, the assessor shall leave the real property without making the inspection.</text> </paragraph> <paragraph num="(b)"> <text>If a person is not physically present on the real property, or the assessor is unable to communicate with a person on the real property, the assessor may conduct an inspection, except as provided in §D of this regulation. After the inspection is completed, the assessor, when practical, shall leave a business card on the real property.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>Certain properties, specifically designated by the local supervisor of assessments and approved by the Department, may be inspected without performing the procedure specified in §C(1) of this regulation.</text> </paragraph> </paragraph> <paragraph num="D."> <text>An inspection may not be made when:</text> <paragraph num="(1)"> <text>A person refuses to permit an inspection, as provided in §C of this regulation; or</text> </paragraph> <paragraph num="(2)"> <text>An owner of real property has notified the Supervisor of Assessments for the county where the real property is located in writing that an inspection may not be permitted.</text> </paragraph> </paragraph> <paragraph num="E."> <text>Interior Inspection. An interior inspection of real property may be made:</text> <paragraph num="(1)"> <text>Upon request of the owner.</text> </paragraph> <paragraph num="(2)"> <text>Upon request of an assessor when approved by the owner.</text> </paragraph> <paragraph num="(3)"> <text>When the real property such as office buildings, common areas of apartment complexes, and retail stores, is open to the general public. In making an inspection under §E(3), the assessor shall comply, when practical, with §C of this regulation.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 2-217, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: December 29, 1986 (13:26 Md. R. 2808)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01C amended effective January 7, 1991 (17:26 Md. R. 2977)</annotation> </annotations> </chapter> <chapter num="07" heading="Release of Property Data"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“CAMA” means the Computer Assisted Mass Appraisal system of the Department.</text> </paragraph> <paragraph num="(2)"> <text>“Property data” means information that describes the physical characteristics of land or improvements to land.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Procedure for Release of Data."> <paragraph num="A."> <text>The Department shall annually compile for public release property data in the CAMA system.</text> </paragraph> <paragraph num="B."> <text>Property data for each county in the CAMA system will be made available in data processing tapes or other forms approved by the Department.</text> </paragraph> <paragraph num="C."> <text>A person may purchase property data for one or more counties by:</text> <paragraph num="(1)"> <text>Completing a written property data request form; and</text> </paragraph> <paragraph num="(2)"> <text>Paying the fees specified by the Department.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 14-201, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: March 29, 1993 (20:6 Md. R. 584)</annotation> </annotations> </chapter> <chapter num="08" heading="Tidal Marshland Valuation"> <regulation prefix="Regulation" num=".01" heading="Valuation."> <text>Tidal marshland is valued at $37.50 per acre.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 2-202, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: December 5, 1994 (21:24 Md. R. 1990)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective October 16, 2000 (27:20 Md. R. 1841)</annotation> </annotations> </chapter> <chapter num="09" heading="Rezoned Real Property"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Dwelling” has the meaning stated in Tax-Property Article, §8-226(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Homeowner” has the meaning stated in Tax-Property Article, §8-226(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Immediate family” has the meaning stated in COMAR 18.02.01.01D.</text> </paragraph> <paragraph num="(4)"> <text>“Legal interest” has the meaning stated in Tax-Property Article, §8-226(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(5)"> <text>“Principal residence” means the one location where the user of rezoned real property regularly resides and is the location designated by the user for the legal purposes of voting, obtaining a driver's license, and filing income tax returns.</text> </paragraph> <paragraph num="(6)"> <text>“Residential use” means use of rezoned real property either as a:</text> <paragraph num="(a)"> <text>Dwelling; or</text> </paragraph> <paragraph num="(b)"> <text>Principal residence by a homeowner's immediate family member.</text> </paragraph> </paragraph> <paragraph num="(7)"> <text>“Rezoned real property” has the meaning stated in Tax-Property Article, §8-226(b), Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Payment of Penalty."> <paragraph num="A."> <text>If a residential use assessment is terminated under Tax-Property Article, §8-228(a), Annotated Code of Maryland, the homeowner who paid taxes based on the residential use assessment shall pay the penalty imposed by Tax-Property Article, §8-228(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>If a part of any rezoned real property is:</text> <paragraph num="(1)"> <text>Subdivided by a recorded plat, the penalty is due and payable at the time the plat is recorded;</text> </paragraph> <paragraph num="(2)"> <text>Used for a purpose other than a residential use, the penalty is due and payable at the time the Department determines the other use to have begun; or</text> </paragraph> <paragraph num="(3)"> <text>Transferred to someone other than an immediate family member of the homeowner, the penalty is due and payable at the time the property is transferred on the assessment books or records.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 8-227(c), Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: June 5, 1995 (22:11 Md. R. 823)</annotation> </annotations> </chapter> <chapter num="10" heading="Open Space Easement Valuation"> <regulation prefix="Regulation" num=".01" heading="Valuation."> <text>The value of conservation property subject to a perpetual easement, as defined by Tax-Property Article, §§8-209.1, 8-219, and 9-107, Annotated Code of Maryland, shall be valued at a rate equivalent to the highest rate that is used to value land that is eligible for agricultural use assessment under Tax Property Article, §8–209, Annotated Code of Maryland, and is set forth in COMAR 18.02.03.08.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 8-209, 8-209.1, 8-219, and 9-107, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date:</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 adopted as an emergency provision effective June 1, 2002 (29:18 Md. R. 1439); adopted permanently effective December 12, 2002 (29:24 Md. R. 1920)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective October 23, 2006 (33:21 Md. R. 1678); February 16, 2026 (53:3 Md. R.123)</annotation> </annotations> </chapter> </subtitle> <subtitle num="03" heading="Personal Property Assessments"> <chapter num="01" heading="General"> <regulation prefix="Regulation" num=".01" heading="Categories and Valuation."> <paragraph num="A."> <text>Personal property in the State (other than operating property of railroads and public utilities) falls into three classes:</text> <paragraph num="(1)"> <text>Stock in business or inventory;</text> </paragraph> <paragraph num="(2)"> <text>Distilled spirits;</text> </paragraph> <paragraph num="(3)"> <text>All other personal property.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Stock in Business.</text> <paragraph num="(1)"> <text>Stock in business or inventory is goods held by a taxpayer for sale or goods placed on consignment to another for sale. Stock in business does not include goods manufactured by the taxpayer or obtained from others and held by the taxpayer for purposes other than sale, or goods manufactured by the taxpayer but placed in possession and control of another as in the case of leased goods.</text> </paragraph> <paragraph num="(2)"> <text>Stock in business is assessed at cost or market value, whichever is lower.</text> </paragraph> <paragraph num="(3)"> <text>In the case of manufacturers who sell some portion of their product at retail, that portion sold at retail is assessed at the cost a retailer would pay for the goods.</text> </paragraph> <paragraph num="(4)"> <text>Materials and Supplies. All materials and supplies that are consumed in the day-to-day operation of any business shall be treated as inventories of stock and trade. This includes items such as contractors' supplies, office supplies, wrapping paper, and bags used in a mercantile operation. It excludes such items as bottles, cases, and other returnable containers used by soft drink or beer industries, as well as supplies of rental uniform and linen operations.</text> </paragraph> </paragraph> <paragraph num="C."> <text>Distilled Spirits. In the valuation and assessment of inventories of distilled spirits of wholesale whiskey businesses, the Maryland Alcoholic Beverage Tax may not be included as part of the inventory value.</text> </paragraph> <paragraph num="D."> <text>All Other Personal Property.</text> <paragraph num="(1)"> <text>Except for operating property of railroads and public utilities and certain distilled spirits, “all other personal property” includes all personal property other than inventory.</text> </paragraph> <paragraph num="(2)"> <text>“All other personal property” is assessed at full cash value. Taxpayers shall report property which has been acquired by purchase at cost in the year of acquisition. Taxpayers shall report property which has been acquired other than by purchase (including property manufactured by the taxpayer) at what the property would have sold for in the year of acquisition.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Depreciation."> <paragraph num="A."> <text>Term Defined. “Salvage value” means the value of personal property after all depreciation under this regulation has been applied.</text> </paragraph> <paragraph num="B."> <text>In the assessment of all other personal property under Tax-Property Article, §8-101(c)(7), Annotated Code of Maryland, a 10 percent rate of depreciation per year is applied to the original cost of most property. Exceptions to the 10 percent depreciation rate can be found in §C of this regulation. Personal property may be depreciated to its salvage value.</text> </paragraph> <paragraph num="C."> <text>Depreciation Schedule. The following annual rates of depreciation shall be applied to the different types of personal property indicated:</text> <paragraph num="(1)"> <text>All personal property not otherwise listed in this depreciation schedule shall be depreciated at 10 percent per year;</text> </paragraph> <paragraph num="(2)"> <text>Except as provided in §C(10) of this regulation, long-lived electric generation machinery and equipment of nonutility entities that generate electricity for sale shall be depreciated at 3-1/3 percent per year;</text> </paragraph> <paragraph num="(3)"> <text>Vessels (over 100 feet) shall be depreciated at 5 percent per year;</text> </paragraph> <paragraph num="(4)"> <text>To be depreciated at 20 percent per year:</text> <paragraph num="(a)"> <text>Mobile telephones;</text> </paragraph> <paragraph num="(b)"> <text>Heavy equipment (tractors, bulldozers);</text> </paragraph> <paragraph num="(c)"> <text>Autos, trucks, and tractors not requiring registration;</text> </paragraph> <paragraph num="(d)"> <text>Radio and television transmitting equipment;</text> </paragraph> <paragraph num="(e)"> <text>Music boxes;</text> </paragraph> <paragraph num="(f)"> <text>Open-air theatre equipment (outdoor equipment, posts, speakers, signs);</text> </paragraph> <paragraph num="(g)"> <text>Motel and hotel furniture (rooms and lobby);</text> </paragraph> <paragraph num="(h)"> <text>Self-service laundry equipment;</text> </paragraph> <paragraph num="(i)"> <text>Theatre seats;</text> </paragraph> <paragraph num="(j)"> <text>Bowling alley equipment;</text> </paragraph> <paragraph num="(k)"> <text>Nursing home furniture, fixtures, and equipment (rooms and lobby);</text> </paragraph> <paragraph num="(l)"> <text>Car wash equipment;</text> </paragraph> <paragraph num="(m)"> <text>X-ray equipment, brain scanners, and MRI equipment;</text> </paragraph> <paragraph num="(n)"> <text>Photocopy equipment;</text> </paragraph> <paragraph num="(o)"> <text>Outdoor Christmas decorations;</text> </paragraph> <paragraph num="(p)"> <text>Hospital room furniture and equipment;</text> </paragraph> <paragraph num="(q)"> <text>Rental soda fountain equipment;</text> </paragraph> <paragraph num="(r)"> <text>Rental pagers;</text> </paragraph> <paragraph num="(s)"> <text>Model home furnishings;</text> </paragraph> <paragraph num="(t)"> <text>Stevedore equipment;</text> </paragraph> <paragraph num="(u)"> <text>Vending machines;</text> </paragraph> <paragraph num="(v)"> <text>Fax machines;</text> </paragraph> <paragraph num="(w)"> <text>Mainframe computers originally costing $500,000 or more;</text> </paragraph> </paragraph> <paragraph num="(5)"> <text>To be depreciated at 30 percent per year:</text> <paragraph num="(a)"> <text>Data processing equipment other than the type mentioned in §C(4) of this regulation;</text> </paragraph> <paragraph num="(b)"> <text>Computer software;</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>Any of the following property owned by equipment rental companies shall be depreciated at 33-1/3 percent per year:</text> <paragraph num="(a)"> <text>Rental televisions;</text> </paragraph> <paragraph num="(b)"> <text>Rental stereo and radio equipment;</text> </paragraph> <paragraph num="(c)"> <text>Rental video cassette recorders and tapes;</text> </paragraph> </paragraph> <paragraph num="(7)"> <text>To be depreciated at 33-1/3 percent per year:</text> <paragraph num="(a)"> <text>Drapes and shades;</text> </paragraph> <paragraph num="(b)"> <text>Carpets;</text> </paragraph> </paragraph> <paragraph num="(8)"> <text>To be depreciated at 50 percent per year:</text> <paragraph num="(a)"> <text>Pinball machines;</text> </paragraph> <paragraph num="(b)"> <text>Video games;</text> </paragraph> <paragraph num="(c)"> <text>Rental tuxedos;</text> </paragraph> <paragraph num="(d)"> <text>Rental uniforms;</text> </paragraph> </paragraph> <paragraph num="(9)"> <text>Property determined by the Department to have an expected life in excess of 10 years at the time of acquisition shall be depreciated at an annual rate as determined by the Department; and</text> </paragraph> <paragraph num="(10)"> <text>Personal property of nonutility nuclear power plants shall be depreciated at annual rates as determined by the Department, consistent with licenses and license extensions.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Possession and Ownership."> <text>If title to personal property is in one person and possession or control of the property in another, as lessee, custodian, consignee, bailee, or otherwise, either the title holder or person in possession or control is considered to be the owner of the property for purpose of property taxation.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Exempt Federal Facilities."> <text>Personal property owned by any person and permanently located on the following federal facilities is exempt from taxation:</text> <paragraph num="A."> <text>Aberdeen Proving Grounds;</text> </paragraph> <paragraph num="B."> <text>Andrews Air Force Base;</text> </paragraph> <paragraph num="C."> <text>Bainbridge Naval Training Center;</text> </paragraph> <paragraph num="D."> <text>National Naval Medical Center, Bethesda;</text> </paragraph> <paragraph num="E."> <text>Camp Detrick;</text> </paragraph> <paragraph num="F."> <text>Census Bureau, Suitland;</text> </paragraph> <paragraph num="G."> <text>Cheltenham, U. S. Navy;</text> </paragraph> <paragraph num="H."> <text>Custom House, Gay and Lombard Streets;</text> </paragraph> <paragraph num="I."> <text>Department of Agriculture, Beltsville;</text> </paragraph> <paragraph num="J."> <text>Edgewood Arsenal;</text> </paragraph> <paragraph num="K."> <text>Fort Howard Hospital;</text> </paragraph> <paragraph num="L."> <text>Fort McHenry;</text> </paragraph> <paragraph num="M."> <text>Fort Meade;</text> </paragraph> <paragraph num="N."> <text>Goddard Space, Beltsville;</text> </paragraph> <paragraph num="O."> <text>Indian Head Naval Ordinance;</text> </paragraph> <paragraph num="P."> <text>National Institutes of Health;</text> </paragraph> <paragraph num="Q."> <text>Naval Academy;</text> </paragraph> <paragraph num="R."> <text>Naval Support Center, Suitland;</text> </paragraph> <paragraph num="S."> <text>Oceanographic Center, Suitland;</text> </paragraph> <paragraph num="T."> <text>Patuxent River Naval Air Warfare Center;</text> </paragraph> <paragraph num="U."> <text>Perry Point Hospital;</text> </paragraph> <paragraph num="V."> <text>Public Health Service Hospital, Wyman Park;</text> </paragraph> <paragraph num="W."> <text>U.S. Coast Guard, Curtis Bay.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 5-101, 8-101(c), and 8-107, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective September 19, 1988 (15:19 Md. R. 2248)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective September 19, 1988 (15:19 Md. R. 2248)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05B amended effective June 5, 1995 (22:11 Md. R. 823)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective March 11, 1996 (23:5 Md. R. 383)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective October 31, 2022 (49:22 Md. R. 980)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02A amended effective April 24, 2006 (33:8 Md. R. 734)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02B amended effective January 1, 1997 (23:25 Md. R. 1786); April 29, 2002 (29:8 Md. R. 701); April 24, 2006 (33:8 Md. R. 734)</annotation> </annotations> </chapter> <chapter num="02" heading="Filings"> <regulation prefix="Regulation" num=".01" heading="Annual Report."> <text>Annual reports required to be filed with the State Department of Assessments and Taxation, pursuant to the provisions of Tax-Property Article, §11-101, Annotated Code of Maryland, shall be submitted to the Department on a form generated by the Department, on a substantially similar form, or through an approved online filing system. The signature of the person signing the report shall be an original inked signature, an exact copy of an original inked signature, or an electronic signature acceptable to the Department under Commercial Law Article, §21-117, Annotated Code of Maryland.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 11-101, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective March 11, 1996 (23:5 Md. R. 383); February 16, 2015 (42:3 Md. R. 318); December 12, 2022 (49:25 Md. R. 1050)</annotation> </annotations> </chapter> <chapter num="03" heading="Penalties"> <regulation prefix="Regulation" num=".01" heading="Good Cause."> <paragraph num="A."> <text>Definition of Good Cause.</text> <paragraph num="(1)"> <text>“Good cause” means:</text> <paragraph num="(a)"> <text>A serious medical or health condition which causes an annual report to be filed late;</text> </paragraph> <paragraph num="(b)"> <text>A penalty which is unjustly excessive;</text> </paragraph> <paragraph num="(c)"> <text>A taxpayer's records or place of business is destroyed by casualty, causing an annual report to be filed late;</text> </paragraph> <paragraph num="(d)"> <text>A taxpayer has filed timely annual reports for each of the 4 preceding taxable years, provided that the report is filed by December 31 of the calendar year in which it is due; or</text> </paragraph> <paragraph num="(e)"> <text>Any other extraordinary circumstance which a person of ordinary business prudence and intelligence would consider reasonable cause for an annual report to be filed late.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>“Good cause” does not mean failure:</text> <paragraph num="(a)"> <text>To receive an annual report form;</text> </paragraph> <paragraph num="(b)"> <text>Of an agent or employee of a taxpayer to file a timely annual report; or</text> </paragraph> <paragraph num="(c)"> <text>To be aware of the requirement to file an annual report.</text> </paragraph> </paragraph> </paragraph> <paragraph num="B."> <text>The excusing conditions in this regulation shall have been experienced by the person who prepares the annual report, so that the report could not have been timely filed. Additionally, it shall be shown that no one other than the person experiencing the condition could have prepared the report.</text> </paragraph> <paragraph num="C."> <text>The Department may abate or reduce a penalty imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, for good cause shown.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Timely Filing—Wrong Office."> <text>An annual report that is filed with the wrong Departmental office, but is timely filed, is not considered untimely filed.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 11-101, and 14-704, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 29, 1985 (12:15 Md. R. 1528)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective January 1, 1996 (22:26 Md. R. 2030)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01A amended effective July 3, 2006 (33:13 Md. R. 1065)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 adopted effective June 30, 1986 (13:13 Md. R. 1496)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 repealed and new Regulation .02 adopted effective March 11, 1996 (23:5 Md. R. 383)</annotation> </annotations> </chapter> <chapter num="04" heading="Banks or Trust Companies"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Bank or trust company” has the meaning stated in Tax-Property Article, §7-221.1, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>Computer Hardware.</text> <paragraph num="(a)"> <text>“Computer hardware” means electronic equipment connected to a computer that is used for the entry, organization, manipulation, or viewing of data.</text> </paragraph> <paragraph num="(b)"> <text>“Computer hardware” includes monitors, keyboards, cables, central processing units, servers, mainframes, personal computers, printers, automated teller machines, check readers, and check sorters.</text> </paragraph> <paragraph num="(c)"> <text>“Computer hardware” does not include furniture.</text> </paragraph> </paragraph> <paragraph num="(3)"> <text>“Computer program” has the meaning stated in Tax-General Article, §11-225, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>Word Processing.</text> <paragraph num="(a)"> <text>“Word processing” means the production of documents by use of computer hardware and software.</text> </paragraph> <paragraph num="(b)"> <text>“Word processing” does not include the production of documents that reflect, or are directly generated by, deposit or loan account activity.</text> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Taxable Property."> <text>A computer program or computer hardware used by a bank or trust company in connection with word processing is subject to valuation and property tax.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Exempt Property."> <text>A computer program or computer hardware owned and used by a bank or trust company in connection with the processing of deposits or loans is not subject to valuation or property tax.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Mixed Use."> <text>If a computer program or computer hardware owned by a bank or trust company is used in both taxable and exempt activities, its taxable status is determined by the primary use of the property.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 7-221.1, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date:</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.04 adopted as an emergency provision effective March 16, 1996 (23:7 Md. R. 549); emergency status expired October 1, 1996; adopted permanently effective January 13, 1997 (24:1 Md. R. 30)</annotation> </annotations> </chapter> <chapter num="05" heading="Manufacturing Processes"> <regulation prefix="Regulation" num=".01" heading="General."> <text>Under Tax-Property Article, §§7-108, 7-109, and 7-225, Annotated Code of Maryland, counties and municipalities are authorized to exempt from local taxation personal property used in a manufacturing process. There are three general activities that encompass the overall manufacturing process, each of which qualifies for the exemption. Each activity may exist without the others being present. These activities are research, development, and manufacturing.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>Development.</text> <paragraph num="(a)"> <text>“Development” means the design, development, and governmentally required premarket testing of prototypes, products, and processes, which involves the translation of research findings or other knowledge into a plan or design for a new product, process, or technique for a business or for a significant improvement to an existing product, process, or technique whether intended for sale or use.</text> </paragraph> <paragraph num="(b)"> <text>“Development” includes:</text> <paragraph num="(i)"> <text>The conceptual formulation and design of product alternatives;</text> </paragraph> <paragraph num="(ii)"> <text>Construction of prototypes; and</text> </paragraph> <paragraph num="(iii)"> <text>Operation of pilot plants.</text> </paragraph> </paragraph> <paragraph num="(c)"> <text>“Development” does not include:</text> <paragraph num="(i)"> <text>Routine or periodic alterations to existing products, production lines, manufacturing, and other ongoing operations, even though those alterations may represent improvements;</text> </paragraph> <paragraph num="(ii)"> <text>Routine product testing activities, except for governmentally required premarket testing; or</text> </paragraph> <paragraph num="(iii)"> <text>Activities that are primarily a service, or development activities of a public utility.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(2)"> <text>Manufacturing.</text> <paragraph num="(a)"> <text>“Manufacturing” means the process of substantially transforming, or a substantial step in the process of substantially transforming, tangible personal property into a new and different article of tangible personal property by use of labor or machinery, converting a tangible raw material into a tangible product.</text> </paragraph> <paragraph num="(b)"> <text>“Manufacturing” includes, pursuant to Tax-Property Article, §1-101(r), Annotated Code of Maryland:</text> <paragraph num="(i)"> <text>The operation of sawmills, grain mills, or feed mills;</text> </paragraph> <paragraph num="(ii)"> <text>Mining;</text> </paragraph> <paragraph num="(iii)"> <text>The identification, design, or genetic engineering of biological materials; and</text> </paragraph> <paragraph num="(iv)"> <text>The design, development, or creation of computer software for sale, lease, or license.</text> </paragraph> </paragraph> <paragraph num="(c)"> <text>“Manufacturing” does not include, pursuant to Tax-Property Article, §1-101(r), Annotated Code of Maryland:</text> <paragraph num="(i)"> <text>Activities that are primarily a service;</text> </paragraph> <paragraph num="(ii)"> <text>Activities that are intellectual, artistic, or clerical in nature; or</text> </paragraph> <paragraph num="(iii)"> <text>Public utility services.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(3)"> <text>Research.</text> <paragraph num="(a)"> <text>“Research” means basic and applied research in the sciences and engineering, involving a planned search or critical investigation aimed at discovery of new knowledge with the hope that this knowledge will be useful in developing a new product, process, or technique for the business or in bringing about a significant improvement to an existing product, process, or technique.</text> </paragraph> <paragraph num="(b)"> <text>“Research” does not include:</text> <paragraph num="(i)"> <text>Market research;</text> </paragraph> <paragraph num="(ii)"> <text>Research of a public utility; or</text> </paragraph> <paragraph num="(iii)"> <text>Research in the social sciences, psychology, or other nontechnical activities.</text> </paragraph> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Substantial Step."> <text>When a manufacturing operation is performed by different businesses, the activity of any one business is considered manufacturing only if it represents a substantial step in the overall operation.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Secondary Factors."> <paragraph num="A."> <text>When it is not clear whether a raw material has undergone a substantial transformation, the Department will consider secondary factors in determining whether manufacturing has occurred.</text> </paragraph> <paragraph num="B."> <text>Secondary factors include:</text> <paragraph num="(1)"> <text>The scale and character of the operation;</text> </paragraph> <paragraph num="(2)"> <text>The number of employees; and</text> </paragraph> <paragraph num="(3)"> <text>Whether the nature of the operation is consistent with the common understanding of the term “manufacturing”.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Application Required."> <text>A business shall file a completed exemption application before an exemption will be approved by the Department.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§1-101(r), 2-201, 2-202, 7-108, 7-109, and 7-225, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: April 19, 1999 (26:8 Md. R. 619)</annotation> </annotations> </chapter> <chapter num="06" heading="Small Businesses"> <regulation prefix="Regulation" num=".01" heading="Definition of Principal Residence."> <text>“Principal residence” means the one location where an individual regularly resides and is the location designated by the individual for the legal purpose of voting, obtaining a driver's license, and filing income tax returns.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Criteria for Exemption."> <text>To qualify for the small business personal property exemption under Tax-Property Article, §7-227, Annotated Code of Maryland, the following criteria shall be met:</text> <paragraph num="A."> <text>The business personal property shall be owned by an individual and used in connection with a business, occupation, or profession that is a sole proprietorship;</text> </paragraph> <paragraph num="B."> <text>The business personal property for which the exemption is claimed shall be located at the individual's principal residence which is also the principal place of business of the sole proprietorship; and</text> </paragraph> <paragraph num="C."> <text>The total original cost of all business personal property owned by the individual, excluding vehicles exempt under Tax-Property Article, §7-230, Annotated Code of Maryland, shall be as provided by Tax-Property Article, §7-227, Annotated Code of Maryland.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 7-227, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: April 19, 1999 (26:8 Md. R. 619)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 12, 2022 (49:25 Md. R. 1050)</annotation> </annotations> </chapter> </subtitle> <subtitle num="04" heading="Business Organizations"> <chapter num="01" heading="Information Provided by the Department"> <regulation prefix="Regulation" num=".01" heading="Information Provided."> <text>The Department will provide the following information:</text> <paragraph num="A."> <text>In answer to written or telephoned requests, the Department will provide free of charge the following information for domestic corporations, limited partnerships, limited liability partnerships, limited liability companies, and any other organization which is required to file its original organizational document or trade name with the Department:</text> <paragraph num="(1)"> <text>Address of principal office;</text> </paragraph> <paragraph num="(2)"> <text>Date of incorporation or date of filing the certificate of limited partnership, the certificate of limited liability partnership, the articles of organization of a limited liability company, any other original organizational document, or the trade name certificate;</text> </paragraph> <paragraph num="(3)"> <text>Resident agent for service, or for business entities that have filed a trade name certificate, the names and addresses of the principal or owner.</text> </paragraph> </paragraph> <paragraph num="B."> <text>In answer to written or telephoned requests, the Department will provide free of charge the following information for foreign corporations, limited partnerships, limited liability partnerships, limited liability companies, and other foreign organizations which are required to qualify or register with the Department:</text> <paragraph num="(1)"> <text>Address of principal office;</text> </paragraph> <paragraph num="(2)"> <text>Date of qualification or registration;</text> </paragraph> <paragraph num="(3)"> <text>Resident agent for service.</text> </paragraph> </paragraph> <paragraph num="C."> <text>In answer to written requests, the Department will provide free of charge information as to availability of trade names and names for corporations, limited partnerships, limited liability partnerships, and limited liability companies.</text> </paragraph> <paragraph num="D."> <text>On written request and accompanied by a fee, the Department will prepare and forward an abstract comprising the items listed above, and, in addition:</text> <paragraph num="(1)"> <text>The names of corporate officers and directors as listed on the most recent report filed with the Department, if available;</text> </paragraph> <paragraph num="(2)"> <text>Whether the corporation is delinquent as to filing required reports;</text> </paragraph> <paragraph num="(3)"> <text>Whether a domestic corporation has had its charter forfeited, or whether a foreign corporation has had its qualification or registration withdrawn or forfeited, and the dates of these proceedings;</text> </paragraph> <paragraph num="(4)"> <text>Whether a domestic corporation, limited partnership, limited liability partnership, limited liability company, or other domestic organization which is required to file its original organizational document with the Department, has been dissolved, has had its certificate withdrawn or has merged into another organization, and the dates of these proceedings;</text> </paragraph> <paragraph num="(5)"> <text>Whether a foreign corporation, limited partnership, limited liability partnership, limited liability company, or other foreign organization which is required to qualify or register with the Department, has had its qualification or registration withdrawn or cancelled or has been merged into another organization, and the dates of these proceedings.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Certificates and Certified Copies."> <text>When the Department provides certificates or certified copies, the signature of the custodian or other person authorized to make certification for the Department and the Department's official seal may be originally produced on a computer-generated printed form approved by the Department.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §2-201; Corporations and Associations Article, §1-406; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective November 7, 1983 (10:22 Md. R. 1968); August 28, 1995 (22:17 Md. R. 1320); September 21, 1998 (25:19 Md. R. 1496)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 adopted effective June 4, 1999 (26:12 Md. R. 926)</annotation> </annotations> </chapter> <chapter num="02" heading="Name Availability"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Distinctive” means a comparison of two written entity names that reveals the presence of a letter or numeral in one that is not in the other, subject to Regulations .03 and .04 of this chapter.</text> </paragraph> <paragraph num="(2)"> <text>“Distinguishable upon the Department's records” means that an entity name must be distinctive from the following names on record with the Department:</text> <paragraph num="(a)"> <text>Names of other active entities;</text> </paragraph> <paragraph num="(b)"> <text>Active trade names;</text> </paragraph> <paragraph num="(c)"> <text>Reserved names;</text> </paragraph> <paragraph num="(d)"> <text>Registered names; and</text> </paragraph> <paragraph num="(e)"> <text>Disclosed assumed names of foreign entities.</text> </paragraph> </paragraph> <paragraph num="(3)"> <text>“Entity” includes those business organizations stated in Corporations and Associations Article, §1-501, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Tail” means those words, or their abbreviations, that must be included in an entity's name under Corporations and Associations Article, §1-502, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(5)"> <text>“Trade name” means a name, title, or designation filed with the Department under Corporations and Associations Article, §1-406, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Entity Names."> <text>An entity name shall be distinguishable upon the Department's records from:</text> <paragraph num="A."> <text>The entity name of an entity organized or authorized to transact business in the State;</text> </paragraph> <paragraph num="B."> <text>An entity name reserved or registered under Corporations and Associations Article, Title 1, Subtitle 5, Annotated Code of Maryland; and</text> </paragraph> <paragraph num="C."> <text>The disclosed assumed name adopted by a foreign entity authorized to transact business in this State.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Distinctive Factors."> <paragraph num="A."> <text>In addition to the requirements of the other regulations of this chapter, when two entities are not in the same category of business organization, that is, corporation, limited partnership, limited liability company, etc., and the only difference between their names is the tails, the names are distinctive.</text> </paragraph> <paragraph num="B."> <text>Example: “JGB Corp.” is distinctive from “JGB LLC” or “JGB Limited Partnership”.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Nondistinctive Factors."> <paragraph num="A."> <text>In addition to the requirements of other regulations of this chapter, presence or absence of the following factors or words do not make an entity name distinctive from one on record.</text> </paragraph> <paragraph num="B."> <text>Factors, Words, Letters, or Punctuation.</text> <paragraph num="(1)"> <text>Tails Between Similar Organizations.</text> <paragraph num="(a)"> <text>When two entities are in the same category of business organization, that is, corporation, limited partnership, limited liability company, etc., and the only difference between their names is the tails, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Example: “WYZ Corp.” is not distinctive from “WYZ, Inc.” or “WYZ Limited”.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>Spacing.</text> <paragraph num="(a)"> <text>When the only difference between two entity names is the presence or absence of a space, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Example: “Maryland LLLP” is not distinctive from Mary land LLLP".</text> </paragraph> </paragraph> <paragraph num="(3)"> <text>Case Sensitivity.</text> <paragraph num="(a)"> <text>When the only difference between two entity names is the presence or absence of lower or uppercase letters, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Example: “Smith Chartered” is not distinctive from “SMIth Chartered”.</text> </paragraph> </paragraph> <paragraph num="(4)"> <text>“And”, “The”, “An”, “Or”, and “Of”.</text> <paragraph num="(a)"> <text>When the only difference between two entity names is the presence or absence of the words “And”, “The”, “An”, “Or”, or “Of”, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Examples: “The ABC, Inc.” is not distinctive from “ABC, Inc.”; “A or B LLLP” is not distinctive from “AB LLLP”.</text> </paragraph> </paragraph> <paragraph num="(5)"> <text>Use of “A”.</text> <paragraph num="(a)"> <text>When the only difference between two entity names is the presence or absence of the letter “A” where “A” is used as an indefinite article, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Example: “A Dog’s Life LLC” is not distinctive from “Dog’s Life LLC”.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>Punctuation.</text> <paragraph num="(a)"> <text>When the only difference between two entity names is the presence or absence of punctuation, the names are not distinctive.</text> </paragraph> <paragraph num="(b)"> <text>Example: “The EFG, LLC” is not distinctive from “The EFG LLC”.</text> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Trade Names."> <paragraph num="A."> <text>Trade names may include a tail.</text> </paragraph> <paragraph num="B."> <text>If a trade name includes a tail, then it is subject to the regulations of this chapter applying to the category of business organization indicated by the tail. (Example: The trade name “ABC, Inc.” is distinctive from “ABC LP”, but not distinctive from “ABC Limited”).</text> </paragraph> <paragraph num="C."> <text>If a trade name does not include a tail and the only difference between it and another entity name is a tail, the names are distinctive. (Example: The trade name “ABC” is distinctive from “ABC, Inc.”).</text> </paragraph> <paragraph num="D."> <text>If a trade name does not include a tail and is being compared to another trade name without a tail, the regulations of this chapter apply. (Example: The trade name “ABC” is distinctive from the trade name “ABC Supplies”, but not distinctive from “The Abc”).</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Foreign Entity Assumed Names."> <text>Assumed names for foreign entities are permitted when that entity's name is not available. When an assumed name is used, it shall include a tail consistent with the foreign entity's category of business organization, and is subject to the regulations of this chapter.</text> </regulation> <annotations> <annotation type="Authority">Corporations and Associations Article, §§1-406, 1-508, 2-106, 4A-208, 4A-1004, 5-106, 7-101, 7-203, 9A-1003, 9A-1004, 9A-1103,10-102, and 10-103; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 2, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective February 13, 1984 (11:3 Md. R. 204)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01D amended effective May 21, 1984 (11:10 Md. R. 864)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01Q, R adopted effective September 4, 1989 (16:17 Md. R. 1887)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 adopted effective September 27, 1982 (9:19 Md. R. 1896)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective September 4, 1989 (16:17 Md. R. 1887)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 adopted effective March 24, 1986 (13:6 Md. R. 684)</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.03 repealed and new Regulations .01—.12 adopted effective February 3, 1992 (19:2 Md. R. 156)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective March 11, 1996 (23:5 Md. R. 383)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective April 21, 1997 (24:8 Md. R. 617)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04B-4 adopted effective April 21, 1997 (24:8 Md. R. 617)</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.12 repealed and new Regulations .01—.06 adopted effective December 14, 1998 (25:25 Md. R. 1834)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04B amended effective December 12, 2022 (49:25 Md. R. 1050)</annotation> </annotations> </chapter> <chapter num="03" heading="Good Standing Status"> <regulation prefix="Regulation" num=".01" heading="Criteria to Maintain Good Standing with the Department."> <paragraph num="A."> <text>In order to be in good standing with the Department, the requirements of §§A-1—H of this regulation shall be met.</text> </paragraph> <paragraph num="A-1."> <text>Domestic Corporations.</text> <paragraph num="(1)"> <text>Articles of Incorporation shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent for the corporation shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>The corporation shall have filed all annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>The corporation shall have paid all penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(5)"> <text>The charter of the corporation may not be forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The corporation may not be dissolved.</text> </paragraph> <paragraph num="(7)"> <text>The corporation may not have merged out of existence or consolidated or converted.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Foreign Corporations.</text> <paragraph num="(1)"> <text>The corporation shall have duly registered or qualified to do interstate, intrastate, or foreign business with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent for the corporation shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>The corporation shall have filed all annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>The corporation shall have paid all fines and penalties imposed by Tax-Property Article, §14-704, Annotated Code of Maryland, and the Corporations and Associations Article, §§7-302 and 7-303, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(5)"> <text>The corporation's right to do business in Maryland cannot have been forfeited or its registration or qualification rendered ineffective.</text> </paragraph> <paragraph num="(6)"> <text>The corporation may not have terminated its registration or qualification.</text> </paragraph> <paragraph num="(7)"> <text>The corporation may not have merged out of existence or consolidated or converted.</text> </paragraph> </paragraph> <paragraph num="C."> <text>Domestic Limited Partnerships.</text> <paragraph num="(1)"> <text>A certificate of limited partnership shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(4)"> <text>Late filing penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The limited partnership's right to use its name and do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The limited partnership may not have filed a certificate of cancellation.</text> </paragraph> <paragraph num="(7)"> <text>The limited partnership may not be merged out of existence or converted.</text> </paragraph> </paragraph> <paragraph num="D."> <text>Foreign Limited Partnerships.</text> <paragraph num="(1)"> <text>An application for registration shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(3)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(4)"> <text>All late filing penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The limited partnership's right to use its name and do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The limited partnership may not have filed a certificate of cancellation.</text> </paragraph> <paragraph num="(7)"> <text>The limited partnership may not be merged out of existence or converted.</text> </paragraph> </paragraph> <paragraph num="E."> <text>Domestic Limited Liability Companies.</text> <paragraph num="(1)"> <text>Articles of organization shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(4)"> <text>Late filing penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The company's right to use its name and do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The company may not have filed articles of cancellation.</text> </paragraph> <paragraph num="(7)"> <text>The company may not be merged out of existence or converted.</text> </paragraph> </paragraph> <paragraph num="F."> <text>Foreign Limited Liability Companies.</text> <paragraph num="(1)"> <text>An application for registration shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(4)"> <text>Late filing penalties imposed by Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The company's right to use its name and do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The company may not have filed a certificate of cancellation.</text> </paragraph> <paragraph num="(7)"> <text>The company may not be merged out of existence or converted.</text> </paragraph> </paragraph> <paragraph num="G."> <text>Domestic Limited Liability Partnerships.</text> <paragraph num="(1)"> <text>A certificate of limited liability partnership shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(4)"> <text>Late filing penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The partnership's right to use its name and do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The partnership may not have filed a withdrawal notice.</text> </paragraph> <paragraph num="(7)"> <text>The limited liability partnership may not be merged out of existence or converted.</text> </paragraph> </paragraph> <paragraph num="H."> <text>Foreign Limited Liability Partnerships.</text> <paragraph num="(1)"> <text>An application for registration shall be on file with the Department.</text> </paragraph> <paragraph num="(2)"> <text>The name and address of a resident agent shall be on file with the Department.</text> </paragraph> <paragraph num="(3)"> <text>Annual reports required by Tax-Property Article, §11-101, Annotated Code of Maryland, shall be filed with the Department.</text> </paragraph> <paragraph num="(4)"> <text>Late filing penalties imposed under Tax-Property Article, §14-704, Annotated Code of Maryland, shall be paid.</text> </paragraph> <paragraph num="(5)"> <text>The partnership's right to do business in Maryland may not have been forfeited.</text> </paragraph> <paragraph num="(6)"> <text>The partnership may not have filed a certificate of cancellation.</text> </paragraph> <paragraph num="(7)"> <text>The limited liability partnership may not be merged out of existence or converted.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 4-207, and 12-101, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: September 27, 1982 (9:19 Md. R. 1896)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective March 11, 1996 (23:5 Md. R. 383); November 5, 2018 (45:22 Md. R. 1027)</annotation> </annotations> </chapter> <chapter num="04" heading="Administration of Maryland Revised Uniform Limited Partnership Act" reason="Repealed"> <annotations> <annotation type="History" subtype="Administrative History">Effective date: November 7, 1983 (10:22 Md. R. 1968)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective July 15, 1985 (12:14 Md. R. 1433)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 adopted effective February 9, 1987 (14:3 Md. R. 274)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 repealed effective January 15, 1996 (23:1 Md. R. 35)</annotation> <annotation type="History" subtype="Administrative History">Chapter repealed effective November 5, 2018 (45:22 Md. R. 1028)</annotation> </annotations> </chapter> <chapter num="05" heading="Revival or Reinstatement of Entity Charters or Authority to Do Business"> <regulation prefix="Regulation" num=".01" heading="Entity."> <text>In this chapter, “entity” means corporation, limited liability company, limited liability partnership, limited partnership, limited liability limited partnership, statutory trust, or professional corporation.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Evidence of Tax Payment."> <text>In order for the Department to accept articles of revival, reinstatement, or a certificate of reinstatement for an entity, there shall be confirmation of personal property tax payment, acceptable to the Department, from each subdivision of Maryland where assessments on personal property have been certified.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 2-202, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: August 13, 1984 (11:16 Md. R. 1394)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended and recodified to Regulation .02, and new Regulation .01 adopted effective September 21, 1998 (25:19 Md. R. 1496)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective November 5, 2018 (45:22 Md. R. 1028)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 12, 2022 (49:25 Md. R. 1051)</annotation> </annotations> </chapter> <chapter num="06" heading="Transfers of Real Property"> <regulation prefix="Regulation" num=".01" heading="Evidence of Tax Payment."> <paragraph num="A."> <text>A document required to be filed with the Department which transfers title to an interest in real property located in Maryland may not be accepted for record unless all:</text> <paragraph num="(1)"> <text>Public taxes, assessments, and charges due on the real property have been paid to the treasurer, tax collector, or director of finance of the county in which the real property is assessed, as required by law; and</text> </paragraph> <paragraph num="(2)"> <text>Taxes on personal property in the county due by the transferor have been paid when all land owned by the transferor in the county is being transferred, as required by law.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Documents covered by this regulation include, but are not limited to:</text> <paragraph num="(1)"> <text>Articles of merger;</text> </paragraph> <paragraph num="(2)"> <text>Articles of consolidation; or</text> </paragraph> <paragraph num="(3)"> <text>Other documents which evidence a consolidation or merger of foreign corporations, foreign limited partnerships, foreign limited liability partnerships, foreign limited liability companies, or other foreign organizations.</text> </paragraph> </paragraph> <paragraph num="C."> <text>An affidavit of tax payment signed by a representative of the transferor stating that the taxes, assessments, and charges referenced in §A of this regulation have been paid shall be sufficient for the Department to accept a document transferring title to an interest in real property..</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Real Property Article, §3-104; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: May 2, 1988 (15:9 Md. R. 1113)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective August 28, 1995 (22:17 Md. R. 1321); December 12, 2022 (49:25 Md. R. 1051)</annotation> </annotations> </chapter> <chapter num="07" heading="Acceptance of Documents"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Acceptance date” means the date a document is accepted for record by the Department.</text> </paragraph> <paragraph num="(2)"> <text>“Document” includes any document that is filed for recordation with the Department by a foreign or domestic corporation, limited partnership, limited liability partnership, limited liability company, or other organization.</text> </paragraph> <paragraph num="(3)"> <text>“Electronic signature” has the meaning stated in Commercial Law Article, §21-101, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Information processing system” has the meaning stated in Commercial Law Article, §21-101, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Procedure."> <paragraph num="A."> <text>Original Filings. The acceptance date of a document is the date that the document is received by the Department provided the:</text> <paragraph num="(1)"> <text>Document conforms with law;</text> </paragraph> <paragraph num="(2)"> <text>Name of the corporation, limited partnership, limited liability partnership, limited liability limited partnership, real estate investment trust, statutory trust, or limited liability company, or trade name is available; and</text> </paragraph> <paragraph num="(3)"> <text>Appropriate fees and taxes are remitted with the document.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Resubmitted Filings. A resubmitted document may retain the date that the document is first received by the Department as the acceptance date if, at the program manager’s discretion, the filer demonstrates good cause for that acceptance date.</text> </paragraph> <paragraph num="C."> <text>If the Department incorrectly rejects a document, then the acceptance date shall be the original date that the document is received by the Department.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Conditions for Nonrefundable Processing Fees."> <text>If documents are not accepted by the Department, the processing fees referenced in Corporations and Associations Article, §1-203, Annotated Code of Maryland, are applied to the resubmission of those documents if resubmitted and accepted within 60 days of the date of non-acceptance.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Electronic Signatures."> <paragraph num="A."> <text>The general provisions of the Corporations and Associations Article, Annotated Code of Maryland, require certain signatures to be affixed to certain records filed with the Department.</text> </paragraph> <paragraph num="B."> <text>Commercial Law Article, §21-117, Annotated Code of Maryland, permits the Department to determine whether, and the extent to which, it will accept electronic signatures and rely upon electronic signatures.</text> </paragraph> <paragraph num="C."> <text>When a record is filed with the Department using an information processing system, the Department shall accept and rely on any associated electronic signature.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Commercial Law Article, §21-117; Corporations and Associations Article, §§1-102, 1-203, and 1-406;Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: December 28, 1987 (14:26 Md. R. 2749)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective August 28, 1995 (22:17 Md. R. 1321); December 11, 2003 (30:24 Md. R. 1745); June 10, 2013 (40:11 Md. R. 977)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 11, 2003 (30:24 Md. R. 1745; December 12, 2022 (49:25 Md. R. 1051))</annotation> <annotation type="History" subtype="Administrative History">Regulation .02A amended effective August 28, 1995 (22:17 Md. R. 1321); November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 adopted effective October 11, 2004 (31:20 Md. R. 1486)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 adopted effective June 10, 2013 (40:11 Md. R. 977)</annotation> </annotations> </chapter> <chapter num="08" heading="Expedited Filing Service"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined. “Expedited service” means the fastest available service for the processing of documents or for providing copies or certificates.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Types of Expedited Service."> <text>The Business Service Unit shall make the following services available on an expedited basis to the extent that budgetary, personnel, or equipment considerations allow:</text> <paragraph num="A."> <text>Review and acceptance for record or rejection of corporation documents, limited partnership documents, and limited liability company documents, including both domestic and foreign entities;</text> </paragraph> <paragraph num="B."> <text>Certified copies and certificates of status (short form only) requested in conjunction with §A of this regulation;</text> </paragraph> <paragraph num="C."> <text>Short form certificates of status for entities already on file and copies of documents already on file, including corporate abstracts;</text> </paragraph> <paragraph num="D."> <text>Review and acceptance for record or rejection of Uniform Commercial Code documents, trade name registrations, trade name amendments, trade name cancellations, and name reservation documents.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Methods of Expedited Service."> <text>Requests for expedited service are received and processed using the following methods in the Department's discretion:</text> <paragraph num="A."> <text>In hard copy delivered or dropped off at the Department’s headquarters office;</text> </paragraph> <paragraph num="B."> <text>In hard copy by mail; or</text> </paragraph> <paragraph num="C."> <text>In electronic format by Internet or electronic mail transmission.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Scope of Expedited Service."> <text>Requests for expedited service are processed as promptly as practicable based upon:</text> <paragraph num="A."> <text>The volume of the request;</text> </paragraph> <paragraph num="B."> <text>When the request is received; and</text> </paragraph> <paragraph num="C."> <text>The manner in which the request is transmitted.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Other Matters."> <paragraph num="A."> <text>A request for more than one copy of a certificate of status for an entity is treated as one request and only one expedited fee is charged.</text> </paragraph> <paragraph num="B."> <text>A request for processing foreign or domestic corporation documents, limited partnership certificates, or limited liability company documents may include up to five certificates of status for the entity or five copies of the document being filed, or both, provided an expedited fee for each type of request is paid.</text> </paragraph> <paragraph num="C."> <text>Fees for expedited service may not be charged on rejected documents.</text> </paragraph> <paragraph num="D."> <text>If the Department is unable to accommodate a request for expedited service, the expedited fee is refunded.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Fee Tiers."> <paragraph num="A."> <text>Documents filed in hard copy with a request to be processed under Corporations and Associations Article, §1-203.2(b)(1), Annotated Code of Maryland, shall be accompanied by an expediting fee of $425.</text> </paragraph> <paragraph num="B."> <text>Documents filed online with a request to be processed under Corporations and Associations Article, §1-203.2(b)(1), Annotated Code of Maryland, shall be accompanied by an expediting fee of $325.</text> </paragraph> <paragraph num="C."> <text>Documents filed in hard copy or online with an expedited request not under Corporations and Associations Article, §1-203.2(b)(1), Annotated Code of Maryland, shall be accompanied by an expediting fee of $50 unless otherwise provided by law.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Filing Acknowledgement."> <text>After a document filed on an expedited basis has been accepted, as promptly as practicable based upon the time and manner by which the filing is transmitted to the Department, the Department shall:</text> <paragraph num="A."> <text>Return to the filer evidence acknowledging the successful filing, any requested good standing certificates, and any requested certified copies of filed documents; and</text> </paragraph> <paragraph num="B."> <text>Post record of the filing to the Department's business registry.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Corporations and Associations Article, §1-203.2; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: October 16, 1989 (16:20 Md. R. 2183)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective March 14, 1994 (21:5 Md. R. 405)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective September 6, 1999 (26:18 Md. R. 1377)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 12, 2022 (49:25 Md. R. 1051)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective December 12, 2022 (49:25 Md. R. 1051)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 repealed and Regulation .06 amended and recodified to be Regulation .05 effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06 adopted effective December 12, 2022 (49:25 Md. R. 1051)</annotation> <annotation type="History" subtype="Administrative History">Regulation .07 adopted effective December 12, 2022 (49:25 Md. R. 1051)</annotation> </annotations> </chapter> <chapter num="09" heading="Fax Service" reason="Repealed"> <annotations> <annotation type="History" subtype="Administrative History">Effective date: February 4, 1991 (18:2 Md. R. 151)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective September 21, 1998 (25:19 Md. R. 1497)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective March 14, 1994 (21:5 Md. R. 405)</annotation> <annotation type="History" subtype="Administrative History">Chapter repealed effective September 6, 1999 (26:18 Md. R. 1377)</annotation> </annotations> </chapter> <chapter num="10" heading="Administration of Trade Names"> <regulation prefix="Regulation" num=".01" heading="Disposition."> <text>After the trade name certificate has been imaged or scanned, the Department may dispose of the original certificate.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Indexing."> <text>Each certificate shall be indexed by trade name and principal or owner.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Amendments."> <paragraph num="A."> <text>The party listed as principal or owner in the certificate already filed may file a certificate amending any item on the certificate, except the trade name.</text> </paragraph> <paragraph num="B."> <text>The amending certificate shall:</text> <paragraph num="(1)"> <text>Set forth the trade name;</text> </paragraph> <paragraph num="(2)"> <text>Set forth the item being amended;</text> </paragraph> <paragraph num="(3)"> <text>Be signed by the principal or owner named in the certificate, and if a new owner or principal is being named, by the new owner or principal, under penalties of perjury; and</text> </paragraph> <paragraph num="(4)"> <text>Be accompanied by a fee set by Corporations and Associations Article, §1-406, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Cancellation."> <paragraph num="A."> <text>The party listed as owner or principal in the certificate may file a certificate cancelling the trade name at any time.</text> </paragraph> <paragraph num="B."> <text>The certificate of cancellation shall:</text> <paragraph num="(1)"> <text>State the trade name;</text> </paragraph> <paragraph num="(2)"> <text>State that the certificate is cancelled;</text> </paragraph> <paragraph num="(3)"> <text>Be signed by the principal or owner named in the certificate; and</text> </paragraph> <paragraph num="(4)"> <text>Be accompanied by a fee set by Corporations and Associations Article, §1-406, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Renewal."> <paragraph num="A."> <text>In this regulation, “filed” means delivered to and date-stamped by the Department.</text> </paragraph> <paragraph num="B."> <text>A certificate is effective for a period of 5 years from the date it is filed.</text> </paragraph> <paragraph num="C."> <text>Every 5 years following the year in which a certificate is filed or renewed, a person who has filed or renewed a certificate and who wishes to renew the certificate shall cause to be filed a completed renewal application within 6 months before the end of the 5-year period.</text> </paragraph> <paragraph num="D."> <text>A renewal application that is completed and filed extends the certificate for 5 years from the end of the previous 5-year period.</text> </paragraph> <paragraph num="E."> <text>The Department shall determine the form of a renewal application.</text> </paragraph> <paragraph num="F."> <text>Except for certificates canceled on the Department's records, the Department may mail a notice of impending expiration of the trade name, during the 6-month period mentioned in §C of this regulation, to the person listed as principal or owner in the certificate, amended certificate, or most recent renewal application.</text> </paragraph> <paragraph num="G."> <text>A completed renewal application shall:</text> <paragraph num="(1)"> <text>State the trade name being renewed and the current address of the business conducted under the trade name;</text> </paragraph> <paragraph num="(2)"> <text>State that the trade name certificate is being renewed;</text> </paragraph> <paragraph num="(3)"> <text>State the SDAT identification number of the associated business;</text> </paragraph> <paragraph num="(4)"> <text>Be signed by a person listed as principal or owner in the certificate, amended certificate, or most recent renewal application; and</text> </paragraph> <paragraph num="(5)"> <text>Be accompanied by a fee set by Corporations and Associations Article, §1-406, Annotated Code of Maryland.</text> </paragraph> </paragraph> <paragraph num="H."> <text>The Department's failure to mail a renewal application form pursuant to §F of this regulation does not suspend the obligation to file a completed renewal application.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Signatures Required on Certificates."> <paragraph num="A."> <text>When a certificate lists more than one principal or owner, the signature of any one owner or principal named in the certificate is sufficient execution for the certificates described in Regulations .03—.05 of this chapter.</text> </paragraph> <paragraph num="B."> <text>When joint forms of ownership are listed, such as tenants by the entireties, joint tenants with right of survivorship, etc., the signature of any one of the principals or owners is sufficient execution for the certificates described in Regulations .03—.05 of this chapter.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Number of Trade Names Per Application."> <text>Only one trade name may be filed per application.</text> </regulation> <regulation prefix="Regulation" num=".08" heading="Expiration."> <paragraph num="A."> <text>Unless renewed under Regulation .05 of this chapter, a certificate expires 5 years from the date it is filed.</text> </paragraph> <paragraph num="B."> <text>The Department shall note a certificate's expiration on its records as soon as practical.</text> </paragraph> <paragraph num="C."> <text>The Department's failure to note a certificate's expiration does not extend a certificate past its expiration date.</text> </paragraph> <paragraph num="D."> <text>After a certificate expires, the:</text> <paragraph num="(1)"> <text>Filing of a completed renewal application does not extend the certificate; and</text> </paragraph> <paragraph num="(2)"> <text>Trade name which is the subject of the certificate is available to a person entitled to file a certificate under Corporations and Associations Article, §1-406, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Corporations and Associations Article, §1-406; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: February 3, 1992 (19:2 Md. R. 156)</annotation> <annotation type="History" subtype="Administrative History">Adopted as COMAR 18.04.09; recodified to 18.04.10</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03B amended effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04B amended effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective May 6, 1996 (23:9 Md. R. 671); December 12, 2022 (49:25 Md. R. 1051)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05F amended effective November 19, 2018 (45:23 Md. R. 1071)</annotation> <annotation type="History" subtype="Administrative History">Regulation .08 adopted effective May 6, 1996 (23:9 Md. R. 671)</annotation> </annotations> </chapter> <chapter num="11" heading="Prohibited Filings"> <regulation prefix="Regulation" num=".01" heading="Affidavits."> <text>The affidavit form required by Corporations and Associations Article, §1-201.1(c), Annotated Code of Maryland, is adopted and the Department has it available to provide to the public.</text> <text>FORM AT END OF CHAPTER</text> </regulation> <annotations> <annotation type="Authority">Corporations and Associations Article, §1-201.1(c), Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 2, 2017 (43:26 Md. R. 1449)</annotation> </annotations> </chapter> <chapter num="12" heading="Annual Reports"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Accept” has the meaning set forth in COMAR 18.04.07.</text> </paragraph> <paragraph num="(2)"> <text>“Annual report” means the report required by Tax-Property Article, §11-101, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Converted entity” means the entity resulting after a conversion.</text> </paragraph> <paragraph num="(4)"> <text>“Converting entity” means an entity that initiates a conversion.</text> </paragraph> <paragraph num="(5)"> <text>“Current year” means the calendar year in which conversion or merger documents are presented to the Department for filing or recordation.</text> </paragraph> <paragraph num="(6)"> <text>“Documents evidencing a conversion” include:</text> <paragraph num="(a)"> <text>A certificate filed by a foreign unincorporated entity registered to do business in Maryland to correct or terminate the entity’s registration due to a conversion; or</text> </paragraph> <paragraph num="(b)"> <text>A certified statement of fact or other evidence of a conversion issued by the keeper of corporate records for the home jurisdiction of a foreign entity registered or qualified to do business in Maryland.</text> </paragraph> </paragraph> <paragraph num="(7)"> <text>“Documents evidencing a merger” include:</text> <paragraph num="(a)"> <text>A certificate filed by a foreign unincorporated entity registered to do business in Maryland to correct or terminate the entity’s registration due to a merger; or</text> </paragraph> <paragraph num="(b)"> <text>A certified statement of fact or other evidence of a merger issued by the keeper of corporate records for the home jurisdiction of a foreign entity registered or qualified to do business in Maryland.</text> </paragraph> </paragraph> <paragraph num="(8)"> <text>“Effective date of filing” has the meaning referenced in Corporations and Associations Article, §1-206, Annotated Code of Maryland, and COMAR 18.04.07, unless otherwise provided by Maryland law.</text> </paragraph> <paragraph num="(9)"> <text>“Foreign corporation or foreign entity” means a corporation or unincorporated entity formed under the laws of a jurisdiction other than Maryland.</text> </paragraph> <paragraph num="(10)"> <text>“Merging entity” means an entity that ceases to exist as the result of a merger.</text> </paragraph> <paragraph num="(11)"> <text>“Past due annual report” means:</text> <paragraph num="(a)"> <text>An annual report due but not filed in a prior year; or</text> </paragraph> <paragraph num="(b)"> <text>An annual report due but not filed in the current year where the effective date of filing is:</text> <paragraph num="(i)"> <text>After April 15, unless all entities involved in a merger were granted an extension under Tax-Property Article, §14-704, Annotated Code of Maryland; or</text> </paragraph> <paragraph num="(ii)"> <text>After June 15, if all entities involved in a merger were granted an extension under Tax-Property Article §14-704, Annotated Code of Maryland.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(12)"> <text>“Prior year” means any calendar year before the current year.</text> </paragraph> <paragraph num="(13)"> <text>“Surviving entity” means the successor to a merger.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Conversions."> <paragraph num="A."> <text>The Department may not accept articles of conversion until all required annual reports have been filed and related filing fees and penalties have been paid through the current year if the converting entity is:</text> <paragraph num="(1)"> <text>A Maryland domestic entity;</text> </paragraph> <paragraph num="(2)"> <text>A foreign unincorporated entity registered to do business in Maryland; or</text> </paragraph> <paragraph num="(3)"> <text>A foreign corporation qualified to do business in Maryland.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The Department may not accept documents evidencing a conversion until all required annual reports have been filed and related filing fees and penalties have been paid through the current year if the converting entity is:</text> <paragraph num="(1)"> <text>A foreign unincorporated entity registered to do business in Maryland; or</text> </paragraph> <paragraph num="(2)"> <text>A foreign corporation qualified to do business in Maryland.</text> </paragraph> </paragraph> <paragraph num="C."> <text>If a converted entity is a Maryland domestic entity or a foreign entity which qualifies or registers to do business in Maryland, the converted entity will not be required to file an annual report until the calendar year immediately following the current year.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Mergers."> <paragraph num="A."> <text>The Department may accept articles of merger or documents evidencing a merger if the merging entity is not required to file an annual report for the current year.</text> </paragraph> <paragraph num="B."> <text>The Department may not accept articles of merger or documents evidencing a merger until all required annual reports have been filed and related filing fees and penalties have been paid by the merging entity through the current year if the surviving entity is:</text> <paragraph num="(1)"> <text>A Maryland domestic entity formed on or after January 1 of the current year;</text> </paragraph> <paragraph num="(2)"> <text>A foreign unincorporated entity registered to do business in Maryland on or after January 1 of the current year;</text> </paragraph> <paragraph num="(3)"> <text>A foreign corporation qualified to do business in Maryland on or after January 1 of the current year; or</text> </paragraph> <paragraph num="(4)"> <text>An entity that has already filed an annual report for the current year or is not required to file an annual report for the current year.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The Department may not accept articles of merger or documents evidencing a merger until all past due annual reports have been filed and related filing fees and penalties have been paid by the merging entity if the surviving entity has not filed its annual report for the current year, and the surviving entity is:</text> <paragraph num="(1)"> <text>A Maryland domestic entity formed prior to January 1 of the current year;</text> </paragraph> <paragraph num="(2)"> <text>A foreign unincorporated entity registered to do business in Maryland prior to January 1 of the current year; or</text> </paragraph> <paragraph num="(3)"> <text>A foreign corporation qualified to do business in Maryland prior to January 1 of the current year.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 11-101, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: December 12, 2022 (49:25 Md. R. 1051)</annotation> </annotations> </chapter> </subtitle> <subtitle num="05" heading="Agricultural Land Transfer Tax"> <chapter num="01" heading="Administration"> <regulation prefix="Regulation" num=".01" heading="Rates of Tax."> <paragraph num="A."> <text>The agricultural land transfer tax (tax) rates are as follows:</text> <paragraph num="(1)"> <text>The rate is 3 percent for a transfer of less than 20 acres of agricultural land with either or both of the following included in the sale price of the lot or parcel:</text> <paragraph num="(a)"> <text>Structures or other items that are separately assessed by the Department; or</text> </paragraph> <paragraph num="(b)"> <text>Site improvements, for example, street, curb, sewer, water, septic, and well.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>The rate is 4 percent for a transfer of less than 20 acres of unimproved agricultural land.</text> </paragraph> <paragraph num="(3)"> <text>The rate is 5 percent for a transfer of agricultural land greater than or equal to 20 acres, whether improved or unimproved.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Reduction in Tax. Except as provided in Tax-Property Article, §13–305(b)(2) or (c)(4), Annotated Code of Maryland, the agricultural land transfer tax is reduced by:</text> <paragraph num="(1)"> <text>25 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 1 full taxable year before a transfer;</text> </paragraph> <paragraph num="(2)"> <text>50 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 2 full consecutive taxable years before a transfer; and</text> </paragraph> <paragraph num="(3)"> <text>65 percent if property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment for 3 or more full consecutive taxable years before a transfer.</text> </paragraph> </paragraph> <paragraph num="C."> <text>In addition to the agricultural land transfer tax imposed under this subtitle, certain counties may impose county agricultural land transfer tax.</text> </paragraph> <paragraph num="D."> <text>In addition to the agricultural land transfer tax, a surcharge in an amount equal to 25 percent of the tax is imposed on an instrument of writing that transfers title to agricultural land, except for an instrument of writing that transfers property of 2 acres or less to be improved to a child or grandchild of the owner.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Calculation of Tax and Surcharge — Value Deductions."> <paragraph num="A."> <text>Under Tax-Property Article, §13-304, Annotated Code of Maryland, the supervisor is required to deduct from the consideration payable for the instrument of writing the “total value”, as defined in Tax-Property Article, §13-301(d), Annotated Code of Maryland, of any improvement on the property before applying the applicable tax rate and surcharge. For this purpose, the supervisor shall deduct only the total value of any structure or other item that is separately assessed on the property's assessment worksheet. For example, a 5-acre parcel transfers for a consideration of $250,000. It is improved with an outbuilding that has a separately itemized value of $175,000 on the property's assessment worksheet. The parcel is also improved with certain site improvements — a driveway, a well, a septic system, and sidewalks — which are all included in the $50,000 land value portion on the assessment worksheet, but are not set out on the worksheet with a separate value for each item. The tax and surcharge are calculated as follows:</text> </paragraph> <paragraph num="B."> <text>Under Tax-Property Article, §13-304, Annotated Code of Maryland, the supervisor is required to deduct from the consideration payable for the instrument of writing the “total value”, as defined in Tax-Property Article, §13-301(d), Annotated Code of Maryland, of any land not subject to the tax and surcharge before applying the applicable tax rate and surcharge. For example, a 10-acre parcel transfers for a consideration of $500,000. One acre of that parcel is a homesite assessed at $100,000 that is not subject to the tax and surcharge. The tax and surcharge are calculated as follows:</text> </paragraph> <paragraph num="C."> <text>Both §§A and B of this regulation may apply in the same transaction. For example, a 10-acre parcel transfers for a consideration of $500,000. It is improved with a dwelling that has a separately itemized value of $175,000 on the property's assessment worksheet. The parcel is also improved with certain site improvements — a driveway, a well, a septic system, and sidewalks — which are all included in the land value portion on the assessment worksheet, but are not set out on the worksheet with a separate value for each item. It also includes a 1-acre homesite assessed at $100,000 that is not subject to the tax and surcharge. The tax and surcharge are calculated as follows:</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Records."> <text>The supervisor of assessments in each county shall maintain adequate records to administer the tax. These records shall include the identification of parcels receiving agricultural use assessment and parcels subject to declarations of intent.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Transfer Procedure."> <paragraph num="A."> <text>The supervisor shall calculate the tax and surcharge, and the body of the written instrument conveying title shall be stamped or electronically noted with the local tax collecting authority’s verification of the amount of tax and surcharge, if any, due. The local tax collecting authority shall collect the tax and surcharge before the supervisor processes the instrument.</text> </paragraph> <paragraph num="B."> <text>The agricultural land transfer tax and surcharge do not apply to an instrument of writing that transfers title to agricultural land that was previously transferred by an instrument of writing that was subject to the agricultural land transfer tax.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Violations of Declaration of Intent."> <text>The following are nonexclusive examples of violations of a declaration of intent where the tax, surcharge, and penalty are imposed on that portion of the land subject to the violation:</text> <paragraph num="A."> <text>Discontinuing or failing to maintain an agricultural activity on the land;</text> </paragraph> <paragraph num="B."> <text>Constructing nonagricultural improvements or nonagricultural site improvements on the land;</text> </paragraph> <paragraph num="C."> <text>Transferring part of the land so that the remaining land no longer qualifies for agricultural use assessment;</text> </paragraph> <paragraph num="D."> <text>Developing a residential building site on the land;</text> </paragraph> <paragraph num="E."> <text>Subdividing the land so that it no longer qualifies for agricultural use assessment; and</text> </paragraph> <paragraph num="F."> <text>Rezoning the land under Tax-Property Article, §8-209(h), Annotated Code of Maryland.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Appeal Procedures."> <paragraph num="A."> <text>General Rule. Except as provided in §B of this regulation, a person appeals the imposition of the tax by first paying the tax. The person then files a written request for refund with the supervisor for the county where the tax was paid. After the person is afforded an opportunity to be heard, the supervisor notifies the person in writing of the supervisor's determination regarding the refund request, which the person may appeal to the Maryland Tax Court under Tax-Property Article, §14-512(d), Annotated Code of Maryland. A final order of the Tax Court may be appealed to the circuit court under Tax-General Article, §13-532, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Declaration of Intent Violation.</text> <paragraph num="(1)"> <text>When the tax, surcharge, and penalty are imposed because there is a violation of a declaration of intent under Tax-Property Article, §13-305, Annotated Code of Maryland, the supervisor determines the value of the land and imposes the tax, surcharge, and penalty on that value. This value is determined as of the most recent July 1, based on the condition and characteristics of the land as of the date of violation. The supervisor notifies the person in writing of the value and the amount of tax, surcharge, and penalty due.</text> </paragraph> <paragraph num="(2)"> <text>The tax, surcharge, and penalty are due on the earlier of the next date on which property tax is due on the land or the date of the next transfer of any part of the land.</text> </paragraph> <paragraph num="(3)"> <text>If the tax, surcharge, and penalty are not yet due under §B(2) of this regulation, the person may appeal the imposition of the tax, surcharge, and penalty to the supervisor under Tax-Property Article, §14-506, Annotated Code of Maryland, without paying the tax, surcharge, and penalty. After affording the person an opportunity to be heard, the supervisor shall notify the person of the supervisor's determination regarding the appeal, which may be appealed to the Tax Court under Tax-Property Article, §14-512(b), Annotated Code of Maryland. A final order of the Tax Court may be appealed to the circuit court under Tax-General Article, §13-532, Annotated Code of Maryland. An appeal under this subsection does not postpone the due date of the tax, surcharge, and penalty.</text> </paragraph> <paragraph num="(4)"> <text>If the person pays the tax, surcharge, and penalty, his appeal rights with regard to the tax, surcharge and penalty are as set forth in §A of this regulation.</text> </paragraph> <paragraph num="(5)"> <text>Whether or not the person pays the tax, surcharge, and penalty, the person may appeal the value used to determine the amount of tax, surcharge, and penalty to the supervisor. Further appeal of the value is to the local property tax assessment appeal board for the county where the land is situated, the Tax Court, and then the circuit court, under Tax-Property Article, §§14-509(a) and 14-512(f)(2), and Tax-General Article, §13-532, Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 13-307, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective September 27, 1982 (9:19 Md. R. 1897)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01G amended effective October 8, 1984 (11:20 Md. R. 1743); December 31, 1984 (11:26 Md. R. 2281)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 repealed and new Regulations .01—.06 adopted effective December 2, 1996 (23:24 Md. R. 1684)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective June 29, 2020 (47:13 Md. R. 643)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 23, 2013 (40:25 Md. R. 2070); June 29, 2020 (47:13 Md. R. 643)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended effective June 29, 2020 (47:13 Md. R. 643)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04A amended effective January 24, 2022 (49:2 Md. R. 78)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective June 29, 2020 (47:13 Md. R. 643)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06B amended effective June 29, 2020 (47:13 Md. R. 643)</annotation> </annotations> </chapter> </subtitle> <subtitle num="06" heading="Exemptions"> <chapter num="01" heading="The Blind"> <regulation prefix="Regulation" num=".01" heading="Receiving Exemption."> <paragraph num="A."> <text>The property of a blind person, held with the spouse as tenants by the entireties, is entitled to exemption.</text> </paragraph> <paragraph num="B."> <text>In tenancy in common and joint tenancy, the exemption is applied only to the undivided interest of the joint tenant or tenant in common, not against the total assessed valuation.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 5-101, and 7-207, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> </annotations> </chapter> <chapter num="02" heading="Payments In Lieu of Taxes"> <regulation prefix="Regulation" num=".01" heading="Records."> <paragraph num="A."> <text>If an agreement for payment in lieu of taxes is made by a local government, the office of the supervisor of assessments in the respective counties shall be notified and provided with the following:</text> <paragraph num="(1)"> <text>The name of the owner;</text> </paragraph> <paragraph num="(2)"> <text>The name of the project;</text> </paragraph> <paragraph num="(3)"> <text>A copy of the executed agreement;</text> </paragraph> <paragraph num="(4)"> <text>The amount of the payment in lieu of taxes.</text> </paragraph> </paragraph> <paragraph num="B."> <text>There is no change in the status of the account unless this information is provided.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 2-202, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01A amended effective September 19, 1988 (15:19 Md. R. 2248)</annotation> </annotations> </chapter> <chapter num="03" heading="Disabled Veteran, Surviving Spouse, Disabled Active Duty Service Member"> <regulation prefix="Regulation" num=".01" heading="Legal Residence."> <paragraph num="A."> <text>Definition.</text> <paragraph num="(1)"> <text>In this chapter, the following term has the meaning indicated.</text> </paragraph> <paragraph num="(2)"> <text>Term Defined. “Legal residence”, as set forth in Tax-Property Article, §7-208, Annotated Code of Maryland, has the same meaning as “principal residence” as that term is defined in COMAR 18.07.03.01.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The Department may request documentation to verify that a dwelling house is the legal or principal residence of an applicant. This documentation may include, but is not limited to, requiring an applicant to execute a sworn affidavit regarding residency for purposes of voting, driver's license address, and income tax filing. Failure to provide the requested information within 30 days of the date of a request shall result in a dwelling house being designated as not a legal or principal residence for purposes of the exemption provided in Tax-Property Article, §7-208, Annotated Code of Maryland.</text> </paragraph> <paragraph num="C."> <text>A dwelling house in this State will not qualify as the legal or principal residence of an applicant if another dwelling is the applicant’s legal or principal residence, either within or outside the State.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax Property Article, §§2-201, 2-202, and 7-208, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: April 29, 2024 (51:8 Md. R 368)</annotation> </annotations> </chapter> </subtitle> <subtitle num="07" heading="Property Tax Credits"> <chapter num="01" heading="Homeowners' Tax Credit Program"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Affidavit” means a sworn statement in writing on a standard form furnished by the Department.</text> </paragraph> <paragraph num="(2)"> <text>“All persons residing in the home” means household occupants as of the date an application is submitted.</text> </paragraph> <paragraph num="(3)"> <text>“Applicant” means a person filing for a property tax credit.</text> </paragraph> <paragraph num="(4)"> <text>“Combined gross income of all persons” means the monies received in the prior calendar year by the applicant homeowner, the spouse, unless separated, divorced, or widowed, or the resident co-owner, or all of these, and the monies received by other nondependent occupants of the household unless they are paying reasonable fixed charges.</text> </paragraph> <paragraph num="(5)"> <text>“Combined net worth” means the net worth of the applicant, spouse or co-owner, or all of these, residing in the dwelling house.</text> </paragraph> <paragraph num="(6)"> <text>“Curtilage” means that amount of land necessary and used for the homesite and dwelling.</text> </paragraph> <paragraph num="(7)"> <text>“Dependent” means a person who satisfies the federal Internal Revenue Service standard for a dependent.</text> </paragraph> <paragraph num="(8)"> <text>“Dwelling house” means the principal residence of a homeowner but does not include any portion of the structure used for a business or income-producing purpose.</text> </paragraph> <paragraph num="(9)"> <text>“Principal residence of the homeowner” is the one dwelling house where the homeowner regularly resides and is the location designated by the owner for the legal purpose of voting, obtaining a driver's license, and filing income tax returns.</text> </paragraph> <paragraph num="(10)"> <text>“Reasonable fixed charges” means the amount of room and board, rent, or expenses paid which are sufficient to defray the cost of an individual residing on the premises.</text> </paragraph> <paragraph num="(11)"> <text>“Total income” means all monies received by a person in a given year, whether taxable for federal or State income tax purposes, or not.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Criteria Adopted."> <text>The following criteria have been adopted by the Department in the processing of applications for the Homeowners' Tax Credit Program:</text> <paragraph num="A."> <text>Curtilage.</text> <paragraph num="(1)"> <text>The amount of real property taxes eligible for credit consideration is calculated upon the curtilage, which shall include:</text> <paragraph num="(a)"> <text>The land occupied by the dwelling house and garage and assessed at a primary rate;</text> </paragraph> <paragraph num="(b)"> <text>The amount of any additional land insufficient in size according to local zoning requirements for another homesite and assessed at a lesser rate, excluding any agriculturally assessed land.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>The curtilage determined under §A(1) of this regulation shall be posted to the assessment field card by the local supervisor of assessments.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Dwelling House.</text> <paragraph num="(1)"> <text>The amount of real property taxes eligible for credit consideration shall be calculated on the curtilage as defined in §A(1) of this regulation and the dwelling house, which is used as the principal residence of a homeowner.</text> </paragraph> <paragraph num="(2)"> <text>A trailer may qualify as a dwelling house if it meets all of the following criteria:</text> <paragraph num="(a)"> <text>The trailer is the principal residence of its owner;</text> </paragraph> <paragraph num="(b)"> <text>The trailer is not located in a trailer park, as defined by local zoning ordinances, where an excise tax is collected by the local government under Article 24, §9-401, Annotated Code of Maryland;</text> </paragraph> <paragraph num="(c)"> <text>The owner of the trailer is not paying a fee for the privilege of using the parking space as defined in Tax-Property Article, §8-234, Annotated Code of Maryland;</text> </paragraph> <paragraph num="(d)"> <text>The owner of the site upon which the trailer is located has established a separate property tax account for the site;</text> </paragraph> <paragraph num="(e)"> <text>The owner of the trailer receives a separate property tax bill for the trailer.</text> </paragraph> </paragraph> </paragraph> <paragraph num="C."> <text>Combined Gross Income of All Persons Residing in the Home.</text> <paragraph num="(1)"> <text>An applicant shall report on the application the combined gross income of all persons residing in the home, if the persons are not dependents, or not paying reasonable fixed charges.</text> </paragraph> <paragraph num="(2)"> <text>An applicant who refuses to submit the information required under §C(1) of this regulation shall be denied a property tax credit.</text> </paragraph> </paragraph> <paragraph num="D."> <text>Dependent. An applicant who claims a person is a dependent, but who does not file a federal income tax return, shall submit verification of the dependency status to the Department in the form of a sworn affidavit.</text> </paragraph> <paragraph num="E."> <text>Reasonable Fixed Charges.</text> <paragraph num="(1)"> <text>A fixed charge reported by an applicant is considered reasonable if it equals one of the following amounts:</text> <paragraph num="(a)"> <text>A minimum weekly standard established by the Department;</text> </paragraph> <paragraph num="(b)"> <text>Ten percent of the nondependent occupant's gross income;</text> </paragraph> <paragraph num="(c)"> <text>Ten percent of the applicant's combined gross income;</text> </paragraph> <paragraph num="(d)"> <text>The aggregate of all individual expenses paid by the occupant to assist in the maintenance of the dwelling house;</text> </paragraph> <paragraph num="(e)"> <text>An amount the local supervisor of assessments or tax credit administrator finds sufficient in cases of extreme hardship.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>An applicant who does not state initially on the application form the amount of a reasonable fixed charge received from a person shall execute a sworn affidavit.</text> </paragraph> </paragraph> <paragraph num="F."> <text>Total Income.</text> <paragraph num="(1)"> <text>Total income, whether taxable for federal or State income tax purposes or not, shall be reported on the tax credit application, and requires:</text> <paragraph num="(a)"> <text>The counting of 100 percent of capital gains and dividends;</text> </paragraph> <paragraph num="(b)"> <text>The disallowance of capital losses in excess of capital gains;</text> </paragraph> <paragraph num="(c)"> <text>The disallowance of depreciation as a business deduction;</text> </paragraph> <paragraph num="(d)"> <text>The disallowance of all federal adjustments to personal income except employee business expenses and the penalty for early withdrawal of savings.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>Total income does not include lump-sum life insurance payments, research grants, and Veterans Administration educational benefits.</text> </paragraph> </paragraph> <paragraph num="G."> <text>Recovery of Tax Credits.</text> <paragraph num="(1)"> <text>The Department shall recover under Tax-Property Article, §9-104(o), Annotated Code of Maryland, the excess amount of credit granted in the following instances:</text> </paragraph> <paragraph num="(2)"> <text>The Department shall request repayment of the excess credit amount from the owner of the dwelling house and shall direct the local city or county treasurer to place a lien on the property if payment is not received.</text> <paragraph num="(a)"> <text>The dwelling house is sold before the end of the taxable year for which a credit was granted;</text> </paragraph> <paragraph num="(b)"> <text>The dwelling house is transferred to the heirs of an applicant before the end of the relevant taxable year;</text> </paragraph> <paragraph num="(c)"> <text>The dwelling house initially was granted an improper amount of tax credit as determined upon a post audit investigation;</text> </paragraph> <paragraph num="(d)"> <text>The homeowner dies before the end of the taxable year for which a credit was granted.</text> </paragraph> </paragraph> </paragraph> <paragraph num="H."> <text>Timeliness of Application. The Department shall consider an application as timely under Tax-Property Article, §9-104(k), Annotated Code of Maryland, if the application is postmarked or received on or before the applicable date.</text> </paragraph> <paragraph num="I."> <text>Illness or Need of Special Care. For purposes of Tax-Property Article, §9-104(j), Annotated Code of Maryland, “illness or need of special care” means that the applicant, spouse, or dependents are actually in need of ongoing medical treatment at a level which cannot be provided in the dwelling house.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Application Procedures Established."> <paragraph num="A."> <text>The Department of Assessments and Taxation has established specific procedures for applicants to complete the Homeowners' Tax Credit application.</text> </paragraph> <paragraph num="B."> <text>Application Procedures Listed.</text> <paragraph num="(1)"> <text>An applicant shall submit with the application form copies of the federal income tax return and accompanying schedules and forms.</text> </paragraph> <paragraph num="(2)"> <text>An applicant who has a substantial ownership interest in a business or partnership shall submit a complete copy of the federal tax return filed for that business or partnership.</text> </paragraph> <paragraph num="(3)"> <text>An applicant may be requested to complete an affidavit to substantiate any information reported on the application.</text> </paragraph> <paragraph num="(4)"> <text>An applicant seeking to exclude the income of a spouse on the basis of a marital separation shall complete an affidavit setting forth the date separation occurred and stating the unlikelihood of the spouse returning to the dwelling house.</text> </paragraph> <paragraph num="(5)"> <text>An applicant not filing by the September 1 deadline shall complete an affidavit stating the reason for the untimely filing if the application is to be considered for an extension.</text> </paragraph> <paragraph num="(6)"> <text>An applicant who can submit proof that the applicant is a home purchaser under Tax-Property Article, §9-104(k-1), Annotated Code of Maryland, may file an application by June 30 of the taxable year for which the credit is sought.</text> </paragraph> <paragraph num="(7)"> <text>An applicant who, pursuant to a court order or separation agreement, permits a spouse, former spouse, or children of that person to reside in the dwelling house without payment of rent, shall submit with the application a copy of the court order.</text> </paragraph> <paragraph num="(8)"> <text>An applicant who refuses to submit any information required under Tax-Property Article, §9-104, Annotated Code of Maryland, and the regulations, shall be denied a tax credit for failure to substantiate the income reported.</text> </paragraph> <paragraph num="(9)"> <text>An applicant who provides false or misleading information to the Department may be denied a tax credit.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The Department may establish additional application procedures which do not appear here, if considered necessary and if not inconsistent with the regulations.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Home Purchasers."> <paragraph num="A."> <text>The Department of Assessments and Taxation establishes the following procedures for Homeowners' Tax Credit applicants who are home purchasers under Tax-Property Article, §9-104, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Application Procedures Listed.</text> <paragraph num="(1)"> <text>The tax credit used to adjust a home purchaser's final tax liability at settlement will be in the form of a check made payable jointly to the home purchaser and the title company, attorney, or agent conducting the settlement.</text> </paragraph> <paragraph num="(2)"> <text>A home purchaser shall submit with the application a copy of the executed sale agreement and all other forms required on the application form to verify the income reported.</text> </paragraph> <paragraph num="(3)"> <text>A home purchaser shall provide information with the application regarding the name and address of the title company, attorney, or agent conducting the settlement and the specific date chosen for the settlement.</text> </paragraph> <paragraph num="(4)"> <text>If a home purchaser fails to provide the Department with the specific date chosen for the settlement, the Department shall use the latest possible settlement date under the contract of sale to calculate the credit. If any additional amount of credit is due, it will be paid to the home purchaser after the settlement occurs.</text> </paragraph> <paragraph num="(5)"> <text>If a home purchaser chooses to use the credit due at the time of settlement, the settlement shall be scheduled not sooner than 45 days after the Department receives the application to allow sufficient time for payment by the Comptroller.</text> </paragraph> <paragraph num="(6)"> <text>A home purchaser may receive at the time of settlement any credit due only on the current tax year's property tax liability. A home purchaser shall apply separately for a tax credit in any subsequent tax year when application forms and income tax returns applicable for that year are available.</text> </paragraph> <paragraph num="(7)"> <text>A home purchaser who fails to meet the conditions or requirements outlined will not receive any credit due at the time of settlement.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 9-104, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.03 amended effective March 11, 1996 (23:5 Md. R. 384)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 adopted as an emergency provision effective June 1, 2000 (27:14 Md. R. 1339); adopted permanently effective December 11, 2000 (27:24 Md. R. 2199)</annotation> <annotation type="History" subtype="Administrative History">Annotation: COMAR 18.07.01.03 cited in Wargo v. State, 62 Md. App. 620 (1985), in which the requirement that an applicant for the homeowners' tax credit provide a copy of his or her federal income tax return was upheld.</annotation> </annotations> </chapter> <chapter num="02" heading="Renters' Tax Credit Program"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Affidavit” means a sworn statement in writing on a standard form furnished by the Department.</text> </paragraph> <paragraph num="(2)"> <text>“All persons who are actual occupants of the dwelling” means household residents during the calendar year for which a credit is sought.</text> </paragraph> <paragraph num="(3)"> <text>“Applicant” means a person filing for a property tax credit.</text> </paragraph> <paragraph num="(4)"> <text>“Combined gross income of all persons” means the monies received in the prior year by the applicant renter, the spouse, unless separated, divorced, or widowed, or the resident co-tenant, or all of these, and the monies received by other nondependent occupants of the household unless they are paying reasonable fixed charges to the applicant renter.</text> </paragraph> <paragraph num="(5)"> <text>“Combined net worth” means the net worth of the applicant, spouse or co-tenant, or all of these, residing in the dwelling unit.</text> </paragraph> <paragraph num="(6)"> <text>“Dependent” means a person who satisfies the federal Internal Revenue Service standard for a dependent.</text> </paragraph> <paragraph num="(7)"> <text>“Dwelling unit” means the principal residence of a renter and may be any type of apartment, an individual house, a duplex, a co-op or condominium, or a house trailer or trailer pad.</text> </paragraph> <paragraph num="(8)"> <text>“Principal residence of the renter” is the one dwelling unit where the renter regularly resides and is the location designated by the renter for the legal purpose of voting, obtaining a driver's license, and filing income tax returns.</text> </paragraph> <paragraph num="(9)"> <text>“Leasehold interest” means a tenancy in the dwelling unit held under a written lease.</text> </paragraph> <paragraph num="(10)"> <text>“Persons 60 years old or older” means a person who reached that age as of December 31 of the year for which a credit is sought.</text> </paragraph> <paragraph num="(11)"> <text>“Reasonable fixed charges” means the amount of room and board, rent, or expenses paid which are sufficient to defray the cost of a person residing on the premises.</text> </paragraph> <paragraph num="(12)"> <text>“Reasonable value of utilities” means the cost of providing heat, gas, or electricity for the dwelling unit.</text> </paragraph> <paragraph num="(13)"> <text>“Total income” means all monies received by a person in a calendar year, whether taxable for federal or State income tax purposes or not.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Criteria Adopted."> <text>The following criteria have been adopted by the Department in the processing of applications for the Renters' Tax Credit Program:</text> <paragraph num="A."> <text>Eligibility.</text> <paragraph num="(1)"> <text>A Renters' Tax Credit shall be available to all persons who meet the following requirements:</text> <paragraph num="(a)"> <text>The individual meets the requirements of Tax-Property Article, §9-102(a)(9), Annotated Code of Maryland, or is the surviving spouse of an individual satisfying the qualification;</text> </paragraph> <paragraph num="(b)"> <text>The individual has a bona fide leasehold interest in the dwelling unit, which may not be owned by a public housing authority or an organization exempt from the payment of property taxes;</text> </paragraph> <paragraph num="(c)"> <text>The individual has resided in the dwelling unit in Maryland for at least 6 months during the calendar year for which the credit is sought;</text> </paragraph> <paragraph num="(d)"> <text>The individual, spouse or resident co-tenant, or all of these, have a combined net worth of less than $200,000, as defined in Tax-Property Article, §9-102(i)(2), Annotated Code of Maryland;</text> </paragraph> <paragraph num="(e)"> <text>The person qualifies on the basis of the formula established in Tax-Property Article, §9-102(h), Annotated Code of Maryland, for comparing the combined gross income reported to the assumed real property taxes included in the occupancy rent, as those terms are defined in Tax-Property Article, §9-102(g), Annotated Code of Maryland, and the regulations;</text> </paragraph> <paragraph num="(f)"> <text>The person submits a complete application furnishing all information required under Tax-Property Article, §9-102(f), Annotated Code of Maryland, and the regulations.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>A person failing to meet the requirements under §A(1) of this regulation shall be notified in writing of the reason by the Department.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Reasonable Value of Utilities.</text> <paragraph num="(1)"> <text>The amount of tax credit shall be calculated on 15 percent of the total rent paid to occupy the dwelling unit in the calendar year reduced by the reasonable value of any utilities included in the rent.</text> </paragraph> <paragraph num="(2)"> <text>The reasonable value of utilities shall be determined according to the following criteria:</text> <paragraph num="(a)"> <text>If the cost of heat and electricity or gas all have been included in the monthly rent charge, the total rent for the calendar year eligible for credit consideration shall be reduced by 18 percent.</text> </paragraph> <paragraph num="(b)"> <text>If only the cost of heat has been included in the monthly rent charge, the total rent for the calendar year eligible for credit consideration shall be reduced by 12 percent.</text> </paragraph> <paragraph num="(c)"> <text>If only the cost of electricity or gas has been included in the monthly rent charge, the total rent for the calendar year eligible for credit consideration shall be reduced by 6 percent.</text> </paragraph> </paragraph> </paragraph> <paragraph num="C."> <text>Combined Gross Income of All Occupants.</text> <paragraph num="(1)"> <text>An applicant shall report on the application the combined gross income of all persons who are actual occupants of the dwelling unit, if the persons are not dependents, or not paying reasonable fixed charges.</text> </paragraph> <paragraph num="(2)"> <text>An applicant who refuses to submit the information required under §C(1) of this regulation shall be denied a property tax credit.</text> </paragraph> </paragraph> <paragraph num="D."> <text>Dependent. An applicant who claims a person is a dependent, but who does not file a federal income tax return, shall submit verification of the dependency status to the Department in the form of a sworn affidavit.</text> </paragraph> <paragraph num="E."> <text>Reasonable Fixed Charges.</text> <paragraph num="(1)"> <text>A fixed charge reported by an applicant is considered reasonable if it equals one of the following amounts:</text> <paragraph num="(a)"> <text>A minimum weekly standard established by the Department;</text> </paragraph> <paragraph num="(b)"> <text>Ten percent of the nondependent occupant's gross income;</text> </paragraph> <paragraph num="(c)"> <text>Ten percent of the applicant's combined gross income;</text> </paragraph> <paragraph num="(d)"> <text>The aggregate of all individual expenses paid by the occupant to assist in the maintenance of the dwelling unit;</text> </paragraph> <paragraph num="(e)"> <text>An amount the local supervisor of assessments or tax credit administrator finds sufficient in cases of extreme hardship.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>An applicant who does not state initially on the application form the amount of a reasonable fixed charge received from a person shall execute a sworn affidavit.</text> </paragraph> </paragraph> <paragraph num="F."> <text>Total Income.</text> <paragraph num="(1)"> <text>Total income, whether taxable for federal or State income tax purposes or not, shall be reported on the tax credit application and requires:</text> <paragraph num="(a)"> <text>The counting of 100 percent of capital gains and dividends;</text> </paragraph> <paragraph num="(b)"> <text>The disallowance of capital losses in excess of capital gains;</text> </paragraph> <paragraph num="(c)"> <text>The disallowance of depreciation as a business deductions;</text> </paragraph> <paragraph num="(d)"> <text>The disallowance of all federal adjustments to personal income except the penalty for early withdrawal of savings.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>Total income does not include lump-sum life insurance payments, research grants, and Veterans Administration educational benefits.</text> </paragraph> </paragraph> <paragraph num="G."> <text>Timeliness of Application. The Department shall consider an application as timely under Tax-Property Article, §9-102(f), Annotated Code of Maryland, if the application is received or postmarked on or before the applicable date.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Application Procedures Established."> <paragraph num="A."> <text>The Department of Assessments and Taxation has established specific procedures for applicants to complete the Renters' Tax Credit application.</text> </paragraph> <paragraph num="B."> <text>Application Procedures Listed.</text> <paragraph num="(1)"> <text>An applicant shall submit with the application form copies of his federal income tax return and accompanying schedules and forms.</text> </paragraph> <paragraph num="(2)"> <text>An applicant may be requested to complete an affidavit to substantiate any information reported on the application.</text> </paragraph> <paragraph num="(3)"> <text>An applicant seeking to exclude the income of a spouse on the basis of a marital separation shall complete an affidavit setting forth the date separation occurred and stating the unlikelihood of the spouse returning to the dwelling unit.</text> </paragraph> <paragraph num="(4)"> <text>An applicant may be required to submit proof of the leasehold interest.</text> </paragraph> <paragraph num="(5)"> <text>An applicant who refuses to submit any information required under Tax-Property Article, §9-102, Annotated Code of Maryland, and the regulations, shall be denied a tax credit for failure to substantiate the application.</text> </paragraph> <paragraph num="(6)"> <text>An applicant who provides false or misleading information to the Department may be denied a tax credit.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The Department may establish additional application procedures which do not appear here, if considered necessary and if not inconsistent with the promulgated regulations.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 9-102, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 7, 1982 (8:26 Md. R. 2106)</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.03 amended effective March 11, 1996 (23:5 Md. R. 384)</annotation> </annotations> </chapter> <chapter num="03" heading="Homestead Property Tax Credit Program"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Actually occupied” means that the homeowner physically resides in the dwelling for the required time period.</text> </paragraph> <paragraph num="(2)"> <text>“Expected to be actually occupied” means the homeowner intends to reside in the dwelling for the required time period except for an unforeseen absence due to illness or need of hospitalization or special care.</text> </paragraph> <paragraph num="(3)"> <text>“Principal residence” is the one dwelling where the homeowner regularly resides and is the location designated by the owner for the legal purposes of voting, obtaining a driver's license, and filing income tax returns.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Verification of Owner Occupancy."> <text>The Department may request documentation to verify that a dwelling is the principal residence of a homeowner. This documentation may include, but is not limited to, requiring an individual to execute a sworn affidavit regarding residency for purposes of voting, driver's license address, and income tax filing. Failure to provide the requested information within 30 days from the date of a request shall result in a dwelling being designated as non-owner-occupied for purposes of the Homestead Property Tax Credit.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Cooperative Corporations."> <paragraph num="A."> <text>Pursuant to Tax-Property Article, §9-105, Annotated Code of Maryland, dwellings occupied through membership in a cooperative corporation are eligible for the Homestead Property Tax Credit.</text> </paragraph> <paragraph num="B."> <text>The following information shall be provided for the Department to administer the credit:</text> <paragraph num="(1)"> <text>For a dwelling's initial eligibility for the credit:</text> <paragraph num="(a)"> <text>The name of any individuals holding membership in the cooperative corresponding to the dwelling; and</text> </paragraph> <paragraph num="(b)"> <text>Documentation under Tax-Property Article, §2-218, Annotated Code of Maryland, verifying that the dwelling is the principal residence of the individuals holding that membership; and</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>For a dwelling whose occupants change due to a change of membership in the cooperative:</text> <paragraph num="(a)"> <text>The name of any individuals acquiring membership in the cooperative corresponding to the dwelling;</text> </paragraph> <paragraph num="(b)"> <text>The date the membership was acquired;</text> </paragraph> <paragraph num="(c)"> <text>Whether consideration was given for the membership; and</text> </paragraph> <paragraph num="(d)"> <text>Documentation under Tax-Property Article, §2-218, Annotated Code of Maryland, verifying that the dwelling is the principal residence of the individuals holding that membership.</text> </paragraph> </paragraph> </paragraph> <paragraph num="C."> <text>The information required by §B of this regulation shall be provided:</text> <paragraph num="(1)"> <text>To the Department's local assessment offices;</text> </paragraph> <paragraph num="(2)"> <text>Under the signed oath of the individuals holding membership in the cooperative corresponding to the dwelling; and</text> </paragraph> <paragraph num="(3)"> <text>On a form furnished by the Department.</text> </paragraph> </paragraph> <paragraph num="D."> <text>The information required by §B(2) of this regulation shall be provided within 60 days of the date that a change of membership in the cooperative occurs.</text> </paragraph> <paragraph num="E."> <text>Failure or refusal to provide the information required by §B of this regulation will result in a dwelling being designated as not a principal residence for purposes of the credit.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, 2-218, and 9-105, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: November 8, 1993 (20:22 Md. R. 1709)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 adopted effective June 30, 2008 (35:13 Md. R. 1181)</annotation> </annotations> </chapter> <chapter num="04" heading="Enterprise Zone Tax Credit Program"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Business entity” has the meaning stated in Tax-Property Article, §9-103, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Certified” means designated by a political subdivision as complying with the standards submitted by the subdivision as provided in Article 83A, §5-402(d)(4), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Date of finality” has the meaning stated in Tax-Property Article, §1-101(i), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Eligible assessment” means the value of qualified personal property which is initially purchased, acquired, leased, transferred, or otherwise brought into Maryland by a certified business entity from January 1 of the calendar year that entity is first certified until the underlying focus area expires.</text> </paragraph> <paragraph num="(5)"> <text>“Focus area” has the meaning stated in Article 83A, §5-401, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(6)"> <text>“Political subdivision” has the meaning stated in Article 83A, §5-401, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(7)"> <text>“Qualified personal property” means personal property located in a focus area.</text> </paragraph> <paragraph num="(8)"> <text>“Tax credit” means the enterprise zone tax credit provided for in Tax-Property Article, §9-103, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(9)"> <text>“Taxable year” has the meaning stated in Tax-Property Article, §1-101(ii), Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Duration of Credit for Personal Property."> <text>Qualified personal property entitled to an eligible assessment may receive a tax credit for 10 consecutive taxable years regardless of whether the underlying focus area expires.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Certification for Personal Property."> <text>In order to administer the tax credit, the Department shall receive annually, on or before the date of finality immediately preceding the taxable year for which the tax credit is to be granted, a listing as to the:</text> <paragraph num="A."> <text>Business entities certified for the tax credit; and</text> </paragraph> <paragraph num="B."> <text>Date the business entities were certified for the tax credit.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="List of Eligible Assessments."> <text>In each taxable year, the Department shall submit to the appropriate governing body a listing of the amount of the eligible assessments for each certified business entity.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 2-202, and 9-103; Article 83A, §5-401 and 5-402; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date:</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.04 adopted as an emergency provision effective December 15, 2000 (28:2 Md. R. 97); emergency status expired May 14, 2001; adopted permanently effective May 28, 2001 (28:10 Md. R. 950)</annotation> </annotations> </chapter> </subtitle> <subtitle num="08" heading="Public Service Company Franchise Tax"> <chapter num="01" heading="Administration"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In these regulations the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Company” means a person engaged in electric, gas, or telephone business in this State. “Company” includes an individual, partnership, corporation, receiver, or other entity.</text> </paragraph> <paragraph num="(2)"> <text>“Department” means the State Department of Assessments and Taxation.</text> </paragraph> <paragraph num="(3)"> <text>“Electric company” means a company engaged in the transmission, distribution, or delivery of electricity in the State.</text> </paragraph> <paragraph num="(4)"> <text>“Gas company” means a company engaged in the transmission, distribution or delivery, of natural gas in the State.</text> </paragraph> <paragraph num="(5)"> <text>Gross Receipts.</text> <paragraph num="(a)"> <text>“Gross receipts” means the total receipts that occur as a result of the company doing business in the State as an electric, gas, or telephone company during the calendar year. For gas and electric companies, “gross receipts” means all revenues included in the operating revenue accounts as prescribed by the Federal Energy Regulatory Commission, unless otherwise specified by Maryland law or regulation.</text> </paragraph> <paragraph num="(b)"> <text>For a telephone company providing interstate long distance telecommunications service, gross receipts are computed based on services charged to a Maryland address. The revenues include the gross charges from the sale of long distance telecommunications service that originates or terminates in Maryland and for which a charge is made to a service address located in the State, regardless of where the amount is billed or paid.</text> </paragraph> <paragraph num="(c)"> <text>Gross receipts includes all surcharges imposed on customers, including the environmental surcharge and surcharges to recover State or local taxes imposed on the company.</text> </paragraph> <paragraph num="(d)"> <text>Exclusions from gross receipts are as provided in Tax-General Article, §8-401(c), Annotated Code of Maryland.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>“State” means:</text> <paragraph num="(a)"> <text>A state, possession, or territory of the United States;</text> </paragraph> <paragraph num="(b)"> <text>The District of Columbia; or</text> </paragraph> <paragraph num="(c)"> <text>The Commonwealth of Puerto Rico.</text> </paragraph> </paragraph> <paragraph num="(7)"> <text>“Tax” means the public service company franchise tax imposed under Tax-General Article, §§8-402 and 8-402.1, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(8)"> <text>Telecommunications Service.</text> <paragraph num="(a)"> <text>“Telecommunications service” means the:</text> <paragraph num="(i)"> <text>Transmission of any interactive electromagnetic communications, including voice, image, data, and any other information, by means of wire, cable, fiber optics, laser, microwave, radio wave, satellite, or other facility, or any combination of these media; or</text> </paragraph> <paragraph num="(ii)"> <text>Provision of facilities and services for the transmission of any interactive electromagnetic communications.</text> </paragraph> </paragraph> <paragraph num="(b)"> <text>“Telecommunications service” includes:</text> <paragraph num="(i)"> <text>Basic telephone service, including any facility or service provided in connection with basic telephone service;</text> </paragraph> <paragraph num="(ii)"> <text>Toll telephone service and teletypewriter or computer exchange service;</text> </paragraph> <paragraph num="(iii)"> <text>Business service; and</text> </paragraph> <paragraph num="(iv)"> <text>Directory assistance.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(9)"> <text>Telephone Company.</text> <paragraph num="(a)"> <text>“Telephone company” means a company that owns lines for the reception, transmission, or communication of messages by telephone or teletype, or that lets, licenses, or sells telecommunications service.</text> </paragraph> <paragraph num="(b)"> <text>“Telephone company” includes companies operating as local exchange carriers, interexchange carriers, or resellers of telecommunications service.</text> </paragraph> <paragraph num="(c)"> <text>“Telephone company” does not include a radio common carrier, a person that owns a customer-owned coin operated telephone, or a company that owns and operates lines for telecommunications service exclusively for its own use.</text> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Companies Subject to the Tax."> <paragraph num="A."> <text>The tax has two parts:</text> <paragraph num="(1)"> <text>A gross receipts tax on electric, gas, and telephone companies; and</text> </paragraph> <paragraph num="(2)"> <text>For electric and gas companies, a tax based on the kilowatt hours of electricity or therms of natural gas delivered by the company for final consumption in the State.</text> </paragraph> </paragraph> <paragraph num="B."> <text>County and municipal utilities and nonprofit electric cooperatives are not subject to the gross receipts tax, but are subject to the tax based on kilowatt hours of electricity delivered. County and municipal utilities are not subject to the tax based on therms of natural gas delivered.</text> </paragraph> <paragraph num="C."> <text>An interstate natural gas pipeline is subject to both the gross receipts tax and the tax based on therms of natural gas delivered if the company delivers natural gas for final consumption to a customer in this State.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Inter-Company Transactions."> <paragraph num="A."> <text>The incidence of the gross receipts tax is intended to fall on a company providing services to the ultimate retail consumer. Therefore, in order to avoid taxing the same transaction more than once, any revenues received by a company for services that will later be resold may not be considered gross receipts as long as the reseller is subject to the tax on those revenues in this State or any other state. For example:</text> <paragraph num="(1)"> <text>Network access, billing, or other revenues derived from the provision of exchange access or other services to an interexchange carrier are not considered gross receipts for a local exchange carrier;</text> </paragraph> <paragraph num="(2)"> <text>Revenues derived from the transmission of gas or electricity to another gas or electric company for the purpose of resale are not considered gross receipts.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The amount and type of all revenues excluded from gross receipts shall be clearly identified in the filing of the annual tax return. The information necessary to support the amount of the exclusions shall be retained and made available to the Department upon request or audit.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Filing Forms and Additional Information."> <paragraph num="A."> <text>Forms shall be filed with the Department at the locations specified on the form.</text> </paragraph> <paragraph num="B."> <text>Each report, application, or response filed for the tax shall be made under oath with a declaration preceding the signature of the author that it is made under penalties of perjury.</text> </paragraph> <paragraph num="C."> <text>A company that anticipates a total tax liability of at least $1,000 for a taxable year shall file a declaration of estimated tax with the Department by April 15 of the taxable year. The company shall pay the Department an amount equal to at least 25 percent of the tax liability for the full taxable year on April 15, June 15, September 15, and December 15.</text> </paragraph> <paragraph num="D."> <text>On or before March 15 annually, each company shall file with the Department a return detailing all operating and nonoperating revenues for the preceding calendar year. Each company shall attach to the return:</text> <paragraph num="(1)"> <text>A check made payable to the Department for the remaining tax due for the period covered by the return; and</text> </paragraph> <paragraph num="(2)"> <text>Financial statements and a copy of the company’s annual report as submitted to the appropriate regulatory authorities.</text> </paragraph> </paragraph> <paragraph num="E."> <text>If a company fails to file the return as required under this regulation, the Department will mail to the company a notice and demand for the return. If the return is not filed within 30 days of the mailing of the notice, the Department will estimate the company’s operating revenues and assess an additional penalty of up to 25 percent of the estimated tax liability.</text> </paragraph> <paragraph num="F."> <text>Returns Filed Without Supporting Documents.</text> <paragraph num="(1)"> <text>If a company files a return but fails to include financial statements and a copy of the company’s annual report as required in §D(2) of this regulation, the Department will mail to the company a notice and demand for the supporting documents. If the supporting documents are not filed within 30 days of the mailing of the notice, the Department will estimate the company’s operating revenues and assess an additional penalty of up to 25 percent of the estimated tax liability.</text> </paragraph> <paragraph num="(2)"> <text>If, at the time of filing a return, a company’s annual report has not been submitted to the appropriate regulatory authorities, the company shall furnish to the Department the date that it is due to be submitted. If the company’s annual report is not filed with the Department within 30 days of the date that it is due to be submitted, the Department will mail to the company a notice and demand for the annual report. If the annual report is not filed within 30 days of the mailing of the notice, the Department will estimate the company’s operating revenues and assess an additional penalty of up to 25 percent of the estimated tax liability.</text> </paragraph> </paragraph> <paragraph num="G."> <text>A company claiming a telephone lifeline credit or a credit for the purchase of Maryland-mined coal shall include with the annual return information detailing the basis for the calculation of the credit. In order to qualify for a Maryland-mined coal tax credit, a company must be able to document that the coal was directly purchased from a mine that extracted the coal from a location in Maryland.</text> </paragraph> <paragraph num="H."> <text>A long distance telephone company shall be allowed a credit for the amount paid, not to exceed the Maryland tax due, upon proof that it has paid a properly due excise, sales and use, or gross receipts tax in another state on a sale from which the gross receipts are subject to Maryland tax.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Assessments, Appeals, and Penalties."> <paragraph num="A."> <text>If, after an audit of the tax return, the Department determines that the tax is more than the amount shown on the return, the Department will mail to the company a deficiency assessment for taxes due.</text> </paragraph> <paragraph num="B."> <text>Interest and penalty shall be imposed if a company fails to pay an installment when due, or estimates a tax that is less than 90 percent of the amount due for the current taxable year and less than 110 percent of the tax paid for the prior taxable year.</text> </paragraph> <paragraph num="C."> <text>Failure to file a return or pay the tax when due will result in the imposition of interest and penalty.</text> </paragraph> <paragraph num="D."> <text>A company may appeal an assessment within 30 days of the date of mailing of the assessment by applying in writing to the Department for a revision or abatement of amounts due. The company may request an informal hearing on the issue. Following the application or hearing, the Department will take appropriate action and issue a final assessment to the company.</text> </paragraph> <paragraph num="E."> <text>A company may appeal a final assessment to the Maryland Tax Court within 30 days after the date of mailing of the final assessment.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-General Article, §§8-402, 8-402.1, 8-404, 8-408, 13-303, 13-402, 13-701, 13-702 and 13-708; Tax-Property Article §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: February 22, 1988 (15:4 Md. R. 474)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective February 20, 1989 (16:3 Md. R. 347); October 26, 1992 (19:21 Md. R. 1893); December 4, 1995 (22:24 Md. R. 1904); June 1, 1998 (25:11 Md. R. 822)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended as an emergency provision effective January 1, 2000 (27:2 Md. R. 141)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective April 17, 2000 (27:7 Md. R. 707)707</annotation> <annotation type="History" subtype="Administrative History">Regulation .02B amended effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended and recodified to Regulation .03 and new Regulation .02 adopted effective April 17, 2000 (27:7 Md. R. 707)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 repealed effective October 26, 1992 (19:21 Md. R. 1893)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03F amended effective September 21, 1998 (25:19 Md. R. 1497)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended and recodified to Regulation .04 effective April 17, 2000 (27:7 Md. R. 707)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended and recodified to Regulation .03 effective October 26, 1992 (19:21 Md. R. 1893)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04D amended effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04E amended effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04F adopted effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended and recodified to Regulation .05 effective April 17, 2000 (27:7 Md. R. 707)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended and recodified to Regulation .04 effective October 26, 1992 (19:21 Md. R. 1893)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06 repealed effective February 20, 1989 (16:3 Md. R. 347)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective April 17, 2000 (27:7 Md. R. 707)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended effective September 15, 2014 (41:18 Md. R. 1010)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05B amended effective June 19, 2006 (33:12 Md. R. 998)</annotation> </annotations> </chapter> </subtitle> <subtitle num="09" heading="Railroad Operating Property"> <chapter num="01" heading="Allocation"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Property factors” means data that measure the physical presence of the operating unit within the State. Examples of property factors include such items as property cost and miles of track.</text> </paragraph> <paragraph num="(2)"> <text>“Revenue factors” means data that measure the economic activity of the operating unit within the State. Examples of revenue factors include such items as gross revenue and net operating income.</text> </paragraph> <paragraph num="(3)"> <text>“Use factors” means data that measure the physical activity of the operating unit within the State. Examples of use factors include such items as ton mileage and originating and terminating tons of freight.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Allocation Factors."> <text>In allocating a portion of the operating unit to the State, the Department may use a combination of property, revenue, and use factors. The factors used shall be sufficient to produce a reasonable estimate of the unit value attributable to the State.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 8-108, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 22, 1991 (18:14 Md. R. 1610)</annotation> </annotations> </chapter> </subtitle> <subtitle num="10" heading="Public Utility Operating Property"> <chapter num="01" heading="Classification"> <regulation prefix="Regulation" num=".01" heading="Procedure."> <paragraph num="A."> <text>In this regulation, “operating unit” has the meaning stated in Tax-Property Article, §1-101(y), Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>The Department considers the criteria in Tax-Property Article, §§1-101(ee) and 8-109(h), Annotated Code of Maryland, in determining whether a company should be classified as a public utility for property tax assessment purposes. A company that does not fully meet all of the criteria may still be classified as a public utility if the Department determines that the company predominantly meets the criteria.</text> </paragraph> <paragraph num="C."> <text>The classification of property as public utility operating property will generally be determined by the ownership and use of the property as of January 1 preceding the taxable year.</text> </paragraph> <paragraph num="D."> <text>If all personal property of a public utility operating unit is transferred between a utility and a nonutility entity on or after January 1, but before July 1, and is reported to the Department, then all of the transferred real and personal property will be reclassified and assessed to the transferee for the taxable year following the transfer. The report shall be filed under oath by the transferor or transferee with the Department by October 1 following the transfer, and include the following information:</text> <paragraph num="(1)"> <text>A description of the property transferred;</text> </paragraph> <paragraph num="(2)"> <text>The date and manner of transfer;</text> </paragraph> <paragraph num="(3)"> <text>The name and address of the transferee;</text> </paragraph> <paragraph num="(4)"> <text>The consideration, including separate allocation of consideration to real and personal property; and</text> </paragraph> <paragraph num="(5)"> <text>Any other information that the Department requires.</text> </paragraph> </paragraph> <paragraph num="E."> <text>If a public utility operating unit transfers less than all of its personal property after January 1, but before July 1, and the transfer includes real property, then for the taxable year following the transfer the:</text> <paragraph num="(1)"> <text>Personal property will be assessed to the transferor;</text> </paragraph> <paragraph num="(2)"> <text>Real property will be assessed to the transferee; and</text> </paragraph> <paragraph num="(3)"> <text>Transferor must file a report with the Department within 30 days of the transfer including the information listed in §D of this regulation.</text> </paragraph> </paragraph> <paragraph num="F."> <text>The Department may require nonutility entities to annually file reports of real and personal property used to generate electricity, and consider cost, income, and sales comparison indicators of value in valuing the property.</text> </paragraph> <paragraph num="G."> <text>In determining the classification of utility operating property, multiple entities under commonly controlled management will generally be included in one public utility operating unit if an unregulated entity is receiving significant revenue or using a significant portion of its real and personal property in providing goods or services to the public utility.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§1-101(y) and (ee), 2-201, and 8-109(h), Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 26, 1998 (25:2 Md. R. 79)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective May 29, 2000 (27:10 Md. R. 968); October 2, 2000 (27:18 Md. R. 1729)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01A, B amended effective December 6, 2018 (45:24 Md. R. 1162)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 repealed effective May 29, 2000 (27:10 Md. R. 968)</annotation> </annotations> </chapter> <chapter num="02" heading="Allocation"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Property factors” means data that measure the physical presence of the operating unit within the State. Examples of property factors include such items as original property cost and depreciated property cost.</text> </paragraph> <paragraph num="(2)"> <text>“Revenue factors” means data that measure the economic activity of the operating unit within the State. Examples of revenue factors include such items as gross revenue and net operating income.</text> </paragraph> <paragraph num="(3)"> <text>“Use factors” means data that measure the physical activity of the operating unit within the State. Examples of use factors include such items as kilowatts sold or generated, therms sold, and barrel/miles.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Allocation Factors."> <text>In allocating a portion of the operating unit to the State, the Department may use a combination of property, revenue, and use factors. The factors used shall be sufficient to produce a reasonable estimate of the unit value attributable to the State.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 8-109, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 22, 1991 (18:14 Md. R. 1610)</annotation> <annotation type="History" subtype="Administrative History">Chapter recodified from COMAR 18.10.01 to COMAR 18.10.02 effective January 26, 1998 (25:2 Md. R. 79)</annotation> </annotations> </chapter> <chapter num="03" heading="Coal Pollution Facilities"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Certified coal pollution control facility” has the meaning stated in Tax-Property Article, §7-239(a)(1), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Coal Waste Disposal Power Project” has the meaning stated in Tax-Property Article, §7-239(a)(2), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Depreciated value” means the original cost of property less its standard depreciation as determined by the Department under COMAR 18.03.01.02.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Exemptions From Property Tax."> <paragraph num="A."> <text>Except as otherwise provided in this regulation, a partial exemption equal to 95 percent of the assessment of the property applies to property placed in service as part of a certified coal pollution control facility or a coal waste disposal power project and for which all necessary permits, including a certificate of public convenience and necessity, are issued after January 1, 1997.</text> </paragraph> <paragraph num="B."> <text>If a certified coal pollution control facility produces a profitable by-product or if a part of the facility is required for the operation of the business without regard to State and federal air quality, water quality, and effluent requirements, the partial exemption under this regulation applies only to that portion of the value of the facility attributable to pollution control activity.</text> </paragraph> <paragraph num="C."> <text>If a certified coal pollution facility engages in the replacement, repair, or retrofit of equipment that was subject to the property tax on or before December 31, 1996, the partial exemption under this regulation is reduced by the replacement value of existing equipment that is replaced, repaired, or retrofitted.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Methods for Calculating the Exemption."> <paragraph num="A."> <text>Any exemption applied to property under Regulation .02B of this chapter is based on its depreciated value.</text> </paragraph> <paragraph num="B."> <text>Any exemption applied to property under Regulation .02C of this chapter is based on the cost of replacement, repair, or retrofit of the equipment minus the depreciated value of the equipment replaced, repaired, or retrofitted.</text> </paragraph> <paragraph num="C."> <text>Partial exemptions described in this chapter are calculated using standard depreciation as determined by the Department. Certified pollution control property is depreciated and subtracted from the depreciated cost of electric generation machinery and equipment. The taxable portion of the partial exemption (95 percent exempt; 5 percent taxable) is depreciated and added to the assessment.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§7-239(f) and 8-109, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: June 2, 1997 (24:11 Md. R. 794)</annotation> <annotation type="History" subtype="Administrative History">Chapter recodified from COMAR 08.10.02 to COMAR 08.10.03 effective January 26, 1998 (25:2 Md. R. 79)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective December 6, 2018 (45:24 Md. R. 1162)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective December 6, 2018 (45:24 Md. R. 1162)</annotation> </annotations> </chapter> </subtitle> <subtitle num="11" heading="Tax Payments"> <chapter num="01" heading="Tax Payments — Immediately Available Funds"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“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's bank account and debiting the taxpayer's bank account for the amount of the payment due.</text> </paragraph> <paragraph num="(2)"> <text>“Automated clearing house (ACH)” means a central clearing facility operated by:</text> <paragraph num="(a)"> <text>A federal reserve bank; or</text> </paragraph> <paragraph num="(b)"> <text>An organization established by agreement with the National Automated Clearing House Association (NACHA) which:</text> <paragraph num="(i)"> <text>Operates as a clearing house for transmitting or receiving entries between banks and bank accounts; and</text> </paragraph> <paragraph num="(ii)"> <text>Authorizes an electronic transfer of funds between banks or bank accounts.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(3)"> <text>“Business day” means the hours between 8 a.m. and 5 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.</text> </paragraph> <paragraph num="(4)"> <text>“Department” means the State Department of Assessments and Taxation or its designee.</text> </paragraph> <paragraph num="(5)"> <text>“Immediately available funds” means an ACH credit, U.S. currency, or wire transfer.</text> </paragraph> <paragraph num="(6)"> <text>“Person” means an individual, receiver, trustee, guardian, personal representative, fiduciary, or representative of any kind, and any partnership, firm, association, corporation, or other entity.</text> </paragraph> <paragraph num="(7)"> <text>“Tax” means a public service company franchise tax, including any interest, penalty, or fees.</text> </paragraph> <paragraph num="(8)"> <text>“Taxpayer” means a person required to pay a tax or file a return or a report.</text> </paragraph> <paragraph num="(9)"> <text>“TXP” means the tax payment addendum convention for use with the National Automated Clearing House Association's “CCD Plus” format application.</text> </paragraph> <paragraph num="(10)"> <text>“Wire transfer” means a transaction in which a taxpayer, through the taxpayer's bank, originates an entry which credits the State's bank account and debits the taxpayer's bank account on the same day the transaction is initiated.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Requirements for Payment by Immediately Available Funds."> <paragraph num="A."> <text>A taxpayer whose unpaid tax liability is $10,000 or more shall remit payment by immediately available funds pursuant to the following:</text> <paragraph num="(1)"> <text>Except as provided in §A(2) of this regulation, tax payment shall be made by using ACH credit; or</text> </paragraph> <paragraph num="(2)"> <text>Tax payment by wire transfer may be used if the taxpayer:</text> <paragraph num="(a)"> <text>Initiates an ACH credit or authorizes an ACH debit transaction which fails;</text> </paragraph> <paragraph num="(b)"> <text>Receives prior approval from the Department; and</text> </paragraph> <paragraph num="(c)"> <text>Assumes all costs associated with the wire transfer transaction.</text> </paragraph> </paragraph> </paragraph> <paragraph num="B."> <text>Additional instructions which may be provided by the Department shall be followed by the taxpayer.</text> </paragraph> <paragraph num="C."> <text>A separate ACH credit or wire transfer allowed under §A of this regulation shall be made for each type of tax and for each period for which the tax is due.</text> </paragraph> <paragraph num="D."> <text>A taxpayer may satisfy the obligation to remit payment in immediately available funds by physical delivery of U.S. currency, with the appropriate return, on or before 1 p.m. on the due date of the obligation, to the Department of Assessments and Taxation, 301 West Preston Street, Room 806, Baltimore, Maryland 21201.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Registration."> <text>A person making a payment as an agent for a taxpayer may be required to register with the Department before initiation of an ACH tax payment.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Use of ACH Payments."> <paragraph num="A."> <text>General. A taxpayer using the ACH payment method shall make the appropriate arrangements to initiate the payment so that the transfer is executed on the date payment is due.</text> </paragraph> <paragraph num="B."> <text>ACH Credit.</text> <paragraph num="(1)"> <text>A taxpayer using the ACH credit payment method shall initiate each payment of tax by contacting its own financial institution and requesting the institution to transfer both the appropriate identifying information and payment to the State's depository bank via an ACH credit.</text> </paragraph> <paragraph num="(2)"> <text>A taxpayer shall remit an ACH credit transaction with an addendum record formatted in accordance with the appropriate TXP convention.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Miscellaneous Filing and Reporting Provisions."> <paragraph num="A."> <text>The Department may require persons remitting taxes by ACH credit or wire transfer method to file an annual reconciliation report.</text> </paragraph> <paragraph num="B."> <text>A taxpayer who remits taxes by ACH credit or wire transfer method shall indicate that fact on all tax returns required to be filed for that period for which tax payment is being made.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-General Article, §13-104; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date:</annotation> <annotation type="History" subtype="Administrative History">Regulations .01—.05 adopted as an emergency provision effective March 11, 1993 (20:7 Md. R. 637); adopted permanently effective July 19, 1993 (20:14 Md. R. 1170)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective January 30, 1995 (22:2 Md. R. 78); December 12, 2022 (49:25 Md. R. 1052)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02A amended effective January 30, 1995 (22:2 Md. R. 78); September 21, 1998 (25:19 Md. R. 1497); December 11, 2003 (30:24 Md. R. 1745); December 6, 2018 (45:24 Md. R. 1162); December 12, 2022 (49:25 Md. R. 1052)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02C amended effective December 12, 2022 (49:25 Md. R. 1052)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective December 12, 2022 (49:25 Md. R. 1052)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04 amended effective December 12, 2022 (49:25 Md. R. 1052)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective December 12, 2022 (49:25 Md. R. 1052)</annotation> </annotations> </chapter> </subtitle> <subtitle num="12" heading="Financial Institution Franchise Tax"> <chapter num="01" heading="Tax Returns" reason="Repealed"> <annotations> <annotation type="History" subtype="Administrative History">Effective date: November 20, 1994 (21:23 Md. R. 1936)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 repealed effective December 6, 2018 (45:24 Md. R. 1162)</annotation> </annotations> </chapter> </subtitle> <subtitle num="13" heading="Recordation Tax"> <chapter num="01" heading="Security Agreements"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms in Commercial Law Article, §9-402(d), Annotated Code of Maryland, have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“County in which each debtor's principal place of business in the State is located” means:</text> <paragraph num="(a)"> <text>For a debtor with one place of business, where the business is conducted;</text> </paragraph> <paragraph num="(b)"> <text>For a debtor with more than one place of business, where the debtor's:</text> <paragraph num="(i)"> <text>Chief executive office is situated, or, if inapplicable,</text> </paragraph> <paragraph num="(ii)"> <text>Business in this State is otherwise directed or managed, or, if inapplicable,</text> </paragraph> <paragraph num="(iii)"> <text>Business in this State is primarily conducted.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(2)"> <text>“County of residence in the State” means:</text> <paragraph num="(a)"> <text>For a debtor with no place of business maintaining one place of abode, where the abode is situated;</text> </paragraph> <paragraph num="(b)"> <text>For a debtor with no place of business maintaining more than one place of abode, where the debtor pays or would be required to pay county income tax.</text> </paragraph> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201, 12-103, and 12-112; Commercial Law Article, §§9-401 and 9-402; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: June 30, 2008 (35:13 Md. R. 1181)</annotation> </annotations> </chapter> <chapter num="02" heading="Transfers of Controlling Interests"> <regulation prefix="Regulation" num=".01" heading="Scope."> <text>The regulations in this chapter apply to both recordation and transfer taxes administered by the Department under Tax-Property Article, Titles 12 and 13, Annotated Code of Maryland, to the extent allowed by law.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Beneficially owned by a real property entity” means the entity holds:</text> <paragraph num="(a)"> <text>An ownership interest in another entity that owns the real property directly;</text> </paragraph> <paragraph num="(b)"> <text>An interest in another entity or entities that, through a series of ownership tiers, ultimately reaches an entity that owns the real property directly; or</text> </paragraph> <paragraph num="(c)"> <text>A beneficial interest in a trust that directly owns the real property or, through a series of trusts or other entities, ultimately reaches an entity that owns the real property directly.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>“Controlling interest” has the meaning stated in Tax-Property Article, §12-117, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Controlling interest percentage standard” means the more-than-80-percent standard in the definition of “controlling interest” as stated in Tax-Property Article, §12-117, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Directly owned by a real property entity” means the entity holds an interest in real property transferable by an instrument of writing.</text> </paragraph> <paragraph num="(5)"> <text>Final Transfer.</text> <paragraph num="(a)"> <text>“Final transfer” has the meaning stated in Tax-Property Article, §12-117, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(b)"> <text>“Final transfer” does not include any transfers or steps in a transfer occurring before July 1, 2008.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>“Instrument of writing” has the meaning stated in Tax-Property Article, §12-101, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(7)"> <text>“Plan of transfer” has the meaning stated in Tax-Property Article, §12-117, Annotated Code of Maryland, and includes:</text> <paragraph num="(a)"> <text>Transfers of interests in a real property entity to multiple grantees under one or more agreements if the totality of the transfers to the separate grantees meets the controlling interest percentage standard in any 12-month period, unless the real property entity can establish to the Department's satisfaction that the transfers were part of entirely separate, distinct, and unrelated contracts or agreements; and</text> </paragraph> <paragraph num="(b)"> <text>Transfers of interests in a real property entity that, if done by an instrument of writing for real property directly, would be taxable under Tax-Property Article, Titles 12 and 13, Annotated Code of Maryland, including articles of consolidation, articles of merger, and articles of transfer, as those terms are defined in Tax-Property Article, §12-101, Annotated Code of Maryland, whereby either:</text> <paragraph num="(i)"> <text>The real property entity ceases to exist; or</text> </paragraph> <paragraph num="(ii)"> <text>The parties holding the controlling interest in the real property entity and their respective allocation of distributions, profits, and losses are not identical at the beginning and end of the transaction.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(8)"> <text>“Real property” has the meaning stated in Tax-Property Article, §12-117, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(9)"> <text>“Real property entity” has the meaning stated in Tax-Property Article, §12-117, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(10)"> <text>“Step transaction doctrine” means the legal doctrine that:</text> <paragraph num="(a)"> <text>Looks to the substance of a transaction over its form to determine that steps have been taken to achieve tax avoidance;</text> </paragraph> <paragraph num="(b)"> <text>Amalgamates or collapses the separate transfers or steps into one transaction where they are actually component parts of a single transaction; and</text> </paragraph> <paragraph num="(c)"> <text>Is based on the application of three separate tests as defined and applied in Read v. Supervisor of Assessments, 354 Md. 383, 731 A.2d 868 (1999), which are the:</text> <paragraph num="(i)"> <text>End result test;</text> </paragraph> <paragraph num="(ii)"> <text>Interdependence test; and</text> </paragraph> <paragraph num="(iii)"> <text>Binding commitment test.</text> </paragraph> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Valuation of Controlling Interests."> <text>The valuation of a controlling interest:</text> <paragraph num="A."> <text>Is not determined solely by the number of shares or other units of ownership interest and the par value or other value assigned to those interests by a real property entity; and</text> </paragraph> <paragraph num="B."> <text>Will consider the value of the rights and benefits associated with the majority ownership of the controlling interest being transferred as reflected in the transactional documents and any other evidence considered relevant by the Department.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Determination of Completed Transfer."> <paragraph num="A."> <text>A transfer of controlling interest is considered complete when the controlling interest percentage standard is met within any 12-month period, regardless of whether other transfers may be planned or have taken place outside of the 12-month period.</text> </paragraph> <paragraph num="B."> <text>If a final transfer of controlling interest is accomplished through multiple steps that would be considered one transaction under the step transaction doctrine, then that one transaction, including all multiple steps that make up that one transaction, is considered effective and complete upon the earlier of the date when:</text> <paragraph num="(1)"> <text>The last step has occurred; or</text> </paragraph> <paragraph num="(2)"> <text>The interest transferred in the multiple steps meets the controlling interest percentage standard, regardless of the fact that other steps may be planned for the future.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Reports of Transfers."> <paragraph num="A."> <text>A real property entity shall file the report required by Tax-Property Article, §12-117(d), Annotated Code of Maryland:</text> <paragraph num="(1)"> <text>On a form required by the Department; and</text> </paragraph> <paragraph num="(2)"> <text>Under the signed oath of an individual who has authority to bind the real property entity.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Reports of transfers of controlling interest shall be filed with the Department within 30 days of the final transfer, regardless of the application of any exemption.</text> </paragraph> <paragraph num="C."> <text>If there is a transfer of an interest in an entity where the value of the real property interest held by that entity is between 70 percent and 80 percent of the value of its assets, that entity may file a report with the Department to reflect that the transfer has occurred without the payment of recordation or transfer taxes.</text> </paragraph> <paragraph num="D."> <text>If there is a transfer of an interest in a real property entity and its value is between 50 percent and the controlling interest percentage standard, that entity may file a report with the Department to reflect that the transfer has occurred without the payment of recordation or transfer taxes.</text> </paragraph> <paragraph num="E."> <text>The fact that the Department accepts a permissive filing under this regulation without the payment of recordation or transfer taxes does not estop it from subsequently determining that the transfer reflected in that filing was taxable.</text> </paragraph> <paragraph num="F."> <text>The filing of a report of transfer under Tax-Property Article, §12-117, Annotated Code of Maryland, or this regulation does not create a requirement to qualify or register with the Department under the Corporations and Associations Article, Annotated Code of Maryland, unless otherwise required by law.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Determination of Consideration."> <paragraph num="A."> <text>The Department determines the amount of consideration payable for the transfer of a controlling interest and imposes the corresponding tax based upon:</text> <paragraph num="(1)"> <text>The report referenced in Regulation .05 of this chapter; and</text> </paragraph> <paragraph num="(2)"> <text>Any other information secured by the Department.</text> </paragraph> </paragraph> <paragraph num="B."> <text>Consideration payable for the transfer of a controlling interest includes all consideration payable under a plan of transfer, regardless of whether it has been totally paid at the time of the final transfer.</text> </paragraph> <paragraph num="C."> <text>If the Department determines that there has been a failure to establish the consideration attributable to the transfer of the controlling interest, the Department will impose the tax upon that proportion of the fair market value of the real property directly or beneficially owned by the real property entity that equals the same proportion of the controlling interest being transferred.</text> </paragraph> <paragraph num="D."> <text>The fair market value referenced in §C of this regulation is the value of the real property determined by the Department as of the date of finality immediately preceding the final transfer.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Applicability of Exemptions."> <paragraph num="A."> <text>The transfer of a controlling interest is exempt from recordation tax only to the extent that a specific transfer under a plan of transfer meets the criteria for an exemption set forth in Tax-Property Article, §12-117(c), Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>The transfer of a controlling interest is exempt from transfer tax only to the extent that a specific transfer under a plan of transfer meets the criteria for an exemption set forth in Tax-Property Article, §13-103(c), Annotated Code of Maryland.</text> </paragraph> <paragraph num="C."> <text>The transfer of a portion of a controlling interest that is exempt will be considered in determining whether there has been a transfer of controlling interest.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".08" heading="Applicability of Other Sections."> <text>If the transfer of a controlling interest is taxable under Tax-Property Article, §§12-117, 12-105(g), and 13-205(d), Annotated Code of Maryland, recordation and transfer taxes will be imposed based only on the latter two sections.</text> </regulation> <regulation prefix="Regulation" num=".09" heading="Ending Existence."> <paragraph num="A."> <text>If a transaction, such as a merger or consolidation, ends the existence of one or more entities, the determination of whether there has been a transfer of controlling interest of a real property entity will be based on the entity that holds the direct or beneficial interest in the real property at the beginning of the transaction.</text> </paragraph> <paragraph num="B."> <text>If the transfer of a controlling interest of a real property entity ends the existence of that real property entity, the surviving entity or entities, regardless of whether they meet the definition of a real property entity, shall:</text> <paragraph num="(1)"> <text>File a report of transfer; and</text> </paragraph> <paragraph num="(2)"> <text>Pay any recordation and transfer tax due.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".10" heading="Burden of Proof."> <text>A real property entity has the burden of establishing to the satisfaction of the Department any information required to administer Tax-Property Article, §12-117, Annotated Code of Maryland, or this chapter.</text> </regulation> <regulation prefix="Regulation" num=".11" heading="Examples."> <text>A Delaware limited liability company (DE LLC) owns only Maryland real property with a value of $10,000,000. A New Jersey corporation (NJ Corp) owns all of the membership interest in DE LLC, which represents 100 percent of NJ Corp's assets. A California corporation (CA Corp) owns all of the stock of NJ Corp and all of the membership interest in a Florida limited liability company (FL LLC), which represents 100 percent of CA Corp's assets. FL LLC owns only Florida real property valued at $1,000,000. The following apply:</text> <paragraph num="A."> <text>The transfer of DE LLC's membership interest is subject to recordation and transfer taxes in Maryland under Tax-Property Article, §12-117, Annotated Code of Maryland;</text> </paragraph> <paragraph num="B."> <text>The transfer of the stock of NJ Corp is subject to recordation and transfer taxes in Maryland under Tax-Property Article, §12-117, Annotated Code of Maryland;</text> </paragraph> <paragraph num="C."> <text>The transfer of the stock of CA Corp is subject to recordation and transfer taxes in Maryland under Tax-Property Article, §12-117, Annotated Code of Maryland, because 80 percent of its assets are still Maryland real property; and</text> </paragraph> <paragraph num="D."> <text>In §C of this regulation, if FL LLC owns only Florida real property valued at $5,000,000, the transfer of the stock of CA Corp is not subject to recordation and transfer taxes in Maryland under Tax-Property Article, §12-117, Annotated Code of Maryland, because CA Corp would no longer be a real property entity.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".12" heading="Tax Avoidance."> <text>The Department will administer Tax-Property Article, §12-117, Annotated Code of Maryland, and this chapter in the broadest legal manner to impose a tax when a transaction involving a transfer of controlling interest in a real property entity is structured to avoid the payment of the taxes.</text> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§12-201, 12-103, 12-112, 12-117, and 13-202, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: June 30, 2008 (35:13 Md. R. 1181)</annotation> </annotations> </chapter> </subtitle> <subtitle num="14" heading="Uniform Commercial Code"> <chapter num="01" heading="General Provisions"> <regulation prefix="Regulation" num=".01" heading="Scope."> <text>The regulations set forth in this subtitle are effective with respect to financing statements filed on or after July 1, 2001.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Definitions."> <paragraph num="A."> <text>In this subtitle, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>Amendment.</text> <paragraph num="(a)"> <text>“Amendment” means a UCC record that amends the information contained in a financing statement.</text> </paragraph> <paragraph num="(b)"> <text>“Amendment” includes assignments, continuations, and terminations.</text> </paragraph> </paragraph> <paragraph num="(2)"> <text>“Assignment” means an amendment that assigns all or a part of a secured party's power to authorize an amendment to a financing statement.</text> </paragraph> <paragraph num="(3)"> <text>“Continuation statement” has the meaning stated in Commercial Law Article, §9-102(27), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Correction statement” means a record filed under Commercial Law Article, §9-518, Annotated Code of Maryland, indicating that a financing statement is inaccurate or wrongfully filed.</text> </paragraph> <paragraph num="(5)"> <text>“File number” has the meaning stated in Commercial Law Article, §§9-102(36) and 9-519(a), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(6)"> <text>“Filing office” means the State Department of Assessments and Taxation.</text> </paragraph> <paragraph num="(7)"> <text>“Filing office correction statement” means a statement of correction entered into the filing office's information system to correct an error by the filing office.</text> </paragraph> <paragraph num="(8)"> <text>“Financing statement” has the meaning stated in Commercial Law Article, §9-102(39), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(9)"> <text>“Individual” means a human being, or a decedent in the case of a debtor that is the decedent's estate.</text> </paragraph> <paragraph num="(10)"> <text>“Initial financing statement” means a UCC record containing the information required to be in an initial financing statement and that causes the filing office to establish the initial record of existence of a financing statement.</text> </paragraph> <paragraph num="(11)"> <text>“Lapse date” means the date on which the effectiveness of a financing statement lapses under Commercial Law Article, §9-515, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(12)"> <text>“Organization” means a legal person who is not an individual.</text> </paragraph> <paragraph num="(13)"> <text>“Record” means an initial financing statement, an amendment, an assignment, a continuation statement, a termination statement, or a correction statement.</text> </paragraph> <paragraph num="(14)"> <text>Remitter.</text> <paragraph num="(a)"> <text>“Remitter” means a person who tenders a UCC record to the filing office for filing, whether the person is a filer or an agent of a filer responsible for tendering the record for filing.</text> </paragraph> <paragraph num="(b)"> <text>“Remitter” includes a service provider who acts as a filer's representative in the filing process.</text> </paragraph> <paragraph num="(c)"> <text>“Remitter” does not include a person responsible merely for the delivery of the record to the filing office, such as the postal service or a courier service.</text> </paragraph> </paragraph> <paragraph num="(15)"> <text>“Secured party of record” has the meaning stated in Commercial Law Article, §9-511, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(16)"> <text>“Termination statement” has the meaning stated in Commercial Law Article, §§9-102(79) and 9-513, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(17)"> <text>“UCC ” means the Maryland Uniform Commercial Code.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Duties and Responsibilities."> <paragraph num="A."> <text>The duties and responsibilities of the filing office with respect to the administration of the UCC are ministerial. In accepting for recordation or refusing to record a financing statement pursuant to this subtitle, the filing office does not:</text> <paragraph num="(1)"> <text>Determine the legal sufficiency or insufficiency of a record;</text> </paragraph> <paragraph num="(2)"> <text>Determine that a security interest in collateral exists or does not exist;</text> </paragraph> <paragraph num="(3)"> <text>Determine that information in the record is correct or incorrect, in whole or in part; or</text> </paragraph> <paragraph num="(4)"> <text>Create a presumption that information in the record is correct or incorrect, in whole or in part.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The responsibility for the legal effectiveness of a financing statement filing rests with the filers and remitters, and the filing office bears no responsibility for effectiveness.</text> </paragraph> <paragraph num="C."> <text>The State and the filing office and their employees and agents are immune from liability that occurs as a result of errors in or omissions from information provided from the UCC information management system or any other errors or omissions with respect to financing statement filings.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Date, Time, and Method of Filing."> <paragraph num="A."> <text>Filing Methods.</text> <paragraph num="(1)"> <text>The Filing Office may accept filings by the methods specified in §A(2)—(4) of this regulation.</text> </paragraph> <paragraph num="(2)"> <text>Hand Delivery to the Filing Office. The file time for a UCC record delivered by this method is the date and time of presentation of a paper record to a representative of the filing office.</text> </paragraph> <paragraph num="(3)"> <text>Postal Service or Express Mail Delivery to the Filing Office. The file time for a UCC record delivered by this method is the date the filing record is received and the time that is manually stamped on the filing by a representative of the filing office.</text> </paragraph> <paragraph num="(4)"> <text>Electronic Transmission to the Filing Office, Excluding Telefacsimile Transmission. The file time for a UCC record delivered by this method is the date and time the filing record is received.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The file times in §A of this regulation apply even though the UCC record may not yet have been accepted for filing and may be subsequently rejected.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Forms."> <paragraph num="A."> <text>The filing office shall accept for filing a form approved by the National Conference of Commissioners on Uniform State Laws or the International Association of Corporation Administrators or any other form providing the information required by Commercial Law Article, Title 9, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>The affidavit form required by Commercial Law Article, §9-501.1(f), Annotated Code of Maryland, is adopted and made available.</text> </paragraph> <paragraph num="C."> <text>Affidavit Form.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Fees."> <paragraph num="A."> <text>Expedited Service Fee. In addition to fees set forth in Commercial Law Article, §9-525, Annotated Code of Maryland, the fee is $50 for the expedited processing of a record as provided in Corporations and Associations Article, §§1-203(8) and 1-203.2, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Copy Fees. In addition to the fees set forth in §A of this regulation, other fees are:</text> <paragraph num="(1)"> <text>$1 per page for a copy of a record;</text> </paragraph> <paragraph num="(2)"> <text>$6 to certify a copy of a record; and</text> </paragraph> <paragraph num="(3)"> <text>$20 per copy or per certified copy of each record provided by expedited service.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Payment Methods."> <paragraph num="A."> <text>Fees may be paid by the methods specified in §§B—C of this regulation.</text> </paragraph> <paragraph num="B."> <text>Checks by Hand Delivery, by Postal Service, or by Express Mail. Personal checks, cashier's checks, and money orders made payable to the filing office and presented by these methods of delivery are accepted by the filing office.</text> </paragraph> <paragraph num="C."> <text>Debit Cards and Credit Cards for All Methods of Delivery. The filing office accepts payment by debit and credit cards for filings.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".08" heading="Overpayment."> <text>The filing office shall process the record and shall refund separately at a later date any overpayment to the remitter.</text> </regulation> <annotations> <annotation type="Authority">Commercial Law Article, §§9-501.1 and 9-526; Corporations and Associations Article, §§1-203(8) and 1-203.2; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 1, 2001 (28:12 Md. R. 1112)</annotation> <annotation type="History" subtype="Administrative History">Regulation .04A amended effective July 4, 2016 (43:13 Md. R. 714)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective December 21, 2015 (42:25 Md. R. 1546)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06 amended effective July 4, 2016 (43:13 Md. R. 714)</annotation> <annotation type="History" subtype="Administrative History">Regulation .07 amended effective July 4, 2016 (43:13 Md. R. 714)</annotation> </annotations> </chapter> <chapter num="02" heading="Refusal of Records"> <regulation prefix="Regulation" num=".01" heading="Grounds for Refusal."> <paragraph num="A."> <text>The grounds for refusal by the filing office to accept a record for filing are listed in Commercial Law Article, §9-516, Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Multiple Debtor Record. If the initial financing statement or an amendment contains more than one debtor name or address and some names or addresses are missing or illegible, the filing office shall accept only the debtors with legible name or names and address pairings.</text> </paragraph> <paragraph num="C."> <text>Multiple Secured Party or Parties Record. If the initial financing statement or an amendment contains more than one secured party or assignee name or address and some names or addresses are missing or illegible, the filing office shall accept only the legible name or names and address pairings.</text> </paragraph> <paragraph num="D."> <text>Remitter Responsibility. It is the responsibility of the remitter to insure the accuracy and completeness of the record in §§B and C of this regulation by performing a subsequent inspection of the public record once indexed.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Procedure Upon Refusal."> <text>If the filing office finds grounds to refuse to accept a UCC record for filing, the filing office shall return the filing to the remitter and provide a written notice of refusal stating the grounds for refusal and the date and time that the record would have been accepted if not refused. The filing office shall separately refund the filing fee at a later date or apply the filing fee to a subsequent filing of a financing statement by the remitter.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Notification of Defects."> <text>This subtitle does not prevent a filing office from communicating to a filer or a remitter that the filing office noticed apparent potential defects in a UCC record, whether or not it was filed or refused for filing. However, the filing office is under no obligation to do so.</text> </regulation> <regulation prefix="Regulation" num=".04" heading="Refusal Errors."> <text>If a secured party or a remitter demonstrates to the satisfaction of the filing office that a UCC record that was refused for filing should not have been, the filing office shall file the UCC record as provided in this subtitle with the filing date and time that the record would have been accepted if not refused. The filing office shall also file a filing office correction statement that states the date and time the filing was originally presented for filing and should have been accepted by the filing office.</text> </regulation> <annotations> <annotation type="Authority">Commercial Law Article, §9-526, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 1, 2001 (28:12 Md. R. 1112)</annotation> </annotations> </chapter> <chapter num="03" heading="UCC Information Management System"> <regulation prefix="Regulation" num=".01" heading="Data Elements."> <paragraph num="A."> <text>The UCC data elements used in the information management system are specified in §§B—G of this regulation.</text> </paragraph> <paragraph num="B."> <text>File Number.</text> <paragraph num="(1)"> <text>Each initial financing statement is identified by its file number. Identification of the initial financing statement is affixed on the UCC files or otherwise permanently associated with the record maintained for UCC files in the information management system. A record is created in the information management system for each initial financing statement and all information comprising the record is maintained in the system.</text> </paragraph> <paragraph num="(2)"> <text>A UCC record other than an initial financing statement is identified by a unique acknowledgment number assigned by the filing office. In the information management system, records of all UCC records other than initial financing statements are linked to the record by the file number of their related initial financing statements.</text> </paragraph> </paragraph> <paragraph num="C."> <text>Type of Record. The type of UCC record from which data is transferred is identified in the information management system from information supplied in the record.</text> </paragraph> <paragraph num="D."> <text>Filing Date and Filing Time. The filing date and filing time of a UCC record is stored in the information management system. Calculation of the lapse date of an initial financing statement is based upon the filing date.</text> </paragraph> <paragraph num="E."> <text>Identification of Parties. The names and addresses of debtors and secured parties are transferred from UCC records to the UCC information management system.</text> </paragraph> <paragraph num="F."> <text>Status of Financing Statement. In the information management system, each financing statement has an active status unless designated terminated or lapsed.</text> </paragraph> <paragraph num="G."> <text>Page Count. The total number of pages in a UCC record is maintained in the information management system.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Name Indexes."> <paragraph num="A."> <text>Individual Debtors.</text> <paragraph num="(1)"> <text>Individual Name Fields. The names of individuals are stored in fields that include only the names of individuals, and not the names of organizations. Separate data entry fields are established for first, middle, and last names of individuals. If the filer makes no designation as to first, middle, and last name, the filing office shall treat the name as submitted as first, middle, and last name for purposes of this regulation. A filer should place the name of a debtor with a single name, for example, “Cher”, in the last name field. The filing office assumes no responsibility for the accurate designation of the components of a name but will accurately enter the data in accordance with the filer's designations.</text> </paragraph> <paragraph num="(2)"> <text>Titles and Prefixes Before Names. Titles and prefixes, such as “doctor”, “reverend”, “Mr.”, “Ms.”, are not entered in the UCC information management system.</text> </paragraph> <paragraph num="(3)"> <text>Titles and Suffixes After Names. Titles or indications of status such as “M.D.” and “esquire” are not entered in the UCC information management system. The only suffixes after names that are entered into the management system are “Jr.”, “Sr.”, and Roman numerals (“II”, “III”, “IV”, “V”, etc.).</text> </paragraph> <paragraph num="(4)"> <text>Truncation—Individual Names. Personal name fields in the UCC database are fixed in length. Although filers should continue to provide full names on their UCC records, a name that exceeds the fixed length is entered as presented to the filing office, up to the maximum length of the data entry field. The length of data entry name files are as follows:</text> <paragraph num="(a)"> <text>First name: 20 characters;</text> </paragraph> <paragraph num="(b)"> <text>Middle name: 20 characters;</text> </paragraph> <paragraph num="(c)"> <text>Last name: 60 characters;</text> </paragraph> <paragraph num="(d)"> <text>Suffix: 25 characters.</text> </paragraph> </paragraph> </paragraph> <paragraph num="B."> <text>Organization Debtors.</text> <paragraph num="(1)"> <text>Single Field. The names of organizations are stored in fields that include only the names of organizations and not the names of individuals. A single field is used to store an organization name.</text> </paragraph> <paragraph num="(2)"> <text>Truncation—Organization Names. The organization name field in the UCC database is fixed in length. The maximum length is 250 characters. A name that exceeds the fixed length is entered as presented to the filing office, up to the maximum length of the data entry field.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Processing and Data Entry Procedures."> <paragraph num="A."> <text>Processing.</text> <paragraph num="(1)"> <text>Date and Time Stamp. The date and time of receipt are noted on the record or otherwise permanently associated with the record maintained for a UCC filing in the UCC information management system at the earliest possible time.</text> </paragraph> <paragraph num="(2)"> <text>Transactions necessary for processing payment of the filing fee are performed.</text> </paragraph> <paragraph num="(3)"> <text>Document Review.</text> <paragraph num="(a)"> <text>The filing office determines whether a ground exists to refuse the document under COMAR 18.14.02.01.</text> </paragraph> <paragraph num="(b)"> <text>File Stamp. If there is no ground for refusal of the document, the document is determined filed, and a label is affixed containing a file number, a unique acknowledgment number, and the file time and date. All such information contained on the label is permanently associated with the record maintained in the UCC information management system. The sequence of the file or acknowledgment number is not an indication of the order in which the document was received.</text> </paragraph> <paragraph num="(c)"> <text>Communication of Acceptance or Refusal.</text> <paragraph num="(i)"> <text>If a record tendered by hand for expedited service is accepted, a paper acknowledgment is delivered by hand to the presenter.</text> </paragraph> <paragraph num="(ii)"> <text>If a record tendered by hand for expedited service is refused, the record, the filing fee, and a notice of refusal are returned in person.</text> </paragraph> <paragraph num="(iii)"> <text>If a record tendered by hand for non-expedited service is accepted or rejected, a paper acknowledgment or notice of refusal is sent via United States Postal Service first class mail.</text> </paragraph> <paragraph num="(iv)"> <text>If a record tendered by postal service, express mail, or any other means is accepted or rejected, a paper acknowledgment or notice of refusal is sent via United States Postal Service first class mail.</text> </paragraph> </paragraph> </paragraph> </paragraph> <paragraph num="B."> <text>Data Entered Into Information Management System.</text> <paragraph num="(1)"> <text>Filing Date. The filing date of a UCC record is the date the UCC record is received with the proper filing fee if the filing office is open to the public on that date. If the filing office is not open on that date, the filing date is the next date the filing office is open. The filing office may perform any duty relating to the record on the filing date or on a date after the filing date.</text> </paragraph> <paragraph num="(2)"> <text>Filing Time. The filing time of a UCC record is determined as provided in COMAR 18.14.01.04.</text> </paragraph> <paragraph num="(3)"> <text>Lapse Date and Time. A lapse date is calculated for each initial financing statement, unless the debtor is indicated to be a transmitting utility. The lapse date is the same date of the same month as the filing date in the fifth year after the filing date or relevant subsequent fifth anniversary if a timely continuation statement is filed. If the initial financing statement indicates that it is filed with respect to a public finance transaction or a manufactured home transaction, the lapse date is the same date of the same month as the filing date in the thirtieth year after the filing date. If there is no timely filing of a continuation, the financing statement will be indicated as “lapsed” after midnight at the end of the lapse date. The relevant anniversary for a February 29 filing date shall be the March 1 in the fifth or thirtieth year following the year of the filing date depending upon the type of transaction.</text> </paragraph> <paragraph num="(4)"> <text>Errors of the Filing Office. The filing office may correct the errors of filing office personnel in the UCC information management system at any time. If the correction occurs after the filing office has issued an acknowledgment, the filing office shall file a filing office correction statement in the UCC information management system identifying the record, stating the date of the correction and explaining the nature of the corrective action taken. The record shall be preserved as long as the record of the initial financing statement is preserved in the UCC information management system.</text> </paragraph> <paragraph num="(5)"> <text>Data Entry of Names from Forms with Designated Fields.</text> <paragraph num="(a)"> <text>A form with designated fields must indicate whether a name is a name of an individual or an organization. The rules in §B(5)(b) and (c) of this regulation apply.</text> </paragraph> <paragraph num="(b)"> <text>Organization Names. Organization names are entered into the UCC information management system exactly as set forth in the UCC record, even if it appears that the name of an individual has been included in the field designated for an organization name.</text> </paragraph> <paragraph num="(c)"> <text>Individual Names. On a form that designates separate fields for first, middle, and last names and any suffix, the filing office enters the names into the first, middle, and last name and suffix fields in the UCC information management system exactly as set forth on the form subject to the provisions of Regulation .02A of this chapter.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>Data Entry of Names from Forms without Designated Fields.</text> <paragraph num="(a)"> <text>The rules in §B(6)(b)—(c) of this regulation apply when entering data from forms without designated fields.</text> </paragraph> <paragraph num="(b)"> <text>Individual and Organization Names on a Single Line. When it is apparent that the name of an individual and the name of an entity are stated on a single line, the name of the individual and the name of the entity are entered as two separate debtors, one as an individual and one as an entity.</text> </paragraph> <paragraph num="(c)"> <text>Individual Names.</text> <paragraph num="(i)"> <text>Freestanding Initials. An initial in the first position of the name is treated as a first name. An initial in the second position of the name is treated as a middle name.</text> </paragraph> <paragraph num="(ii)"> <text>Combined Initials and Names. If an initial and a name to which the initial apparently corresponds are submitted in one name field, only the name is entered, for example, “D. (David)” in the name “John D. (David) Rockefeller” is entered as “John” (first name), “David” (middle name), “Rockefeller” (last name).</text> </paragraph> <paragraph num="(iii)"> <text>Multiple Individual Names on a Single Line. Two individual names contained in a single line are entered as two different debtors, for example, the debtor name “John and Mary Smith” is entered as two debtors, “John Smith” and “Mary Smith”.</text> </paragraph> <paragraph num="(iv)"> <text>Nicknames. A nickname is entered in the name field together with the name preceding the nickname, or if none, then as the first name, for example, “William (Bill) Jones”.</text> </paragraph> </paragraph> <paragraph num="(d)"> <text>A form without designated fields that is an initial financing statement or an amendment that adds a debtor to a financing statement and that fails to specify whether the debtor is an individual or an organization shall be refused by the filing office.</text> </paragraph> </paragraph> <paragraph num="(7)"> <text>Verification of Data Entry. The filing office uses visual inspection to verify the accuracy of its data entry. The filing office also relies upon the inspection of the record by the remitter to verify the data entered into the management information system.</text> </paragraph> <paragraph num="(8)"> <text>Initial Financing Statement.</text> <paragraph num="(a)"> <text>A new record that bears the file number of the financing statement and the date and time of filing is opened in the UCC information management system for each initial financing statement.</text> </paragraph> <paragraph num="(b)"> <text>The name and address of each debtor set forth in the financing statement are entered into the record of the financing statement. This debtor name is included in the searchable index and is not removed from the information management system of the filing office even after the financing statement lapses.</text> </paragraph> <paragraph num="(c)"> <text>The name and address of each secured party set forth in the financing statement are entered into the record of the financing statement.</text> </paragraph> <paragraph num="(d)"> <text>The record is indexed according to the name of the debtor or debtors and is maintained for public inspection.</text> </paragraph> <paragraph num="(e)"> <text>A lapse date is established for the financing statement, unless the initial financing statement indicates it is filed against a transmitting utility, and the lapse date is maintained as part of the record.</text> </paragraph> </paragraph> <paragraph num="(9)"> <text>Amendment.</text> <paragraph num="(a)"> <text>A record that bears the acknowledgment number for the amendment and the date and time of filing is created for the amendment.</text> </paragraph> <paragraph num="(b)"> <text>The record of the amendment is associated with the record of the related initial financing statement in a manner that causes the amendment to be retrievable each time a record of the financing statement is retrieved.</text> </paragraph> <paragraph num="(c)"> <text>The name and address of each additional debtor and secured parties are entered into the UCC information management system in the record of the financing statement. Each additional debtor name is added to the searchable index and is not removed from the information management system of the filing office even after the financing statement lapses. An amendment that changes a debtor's name is cross-indexed in the UCC information management system so that a search under either the debtor's old name or debtor's new name will reveal the initial financing statement and all related UCC records. An amendment that changes the name of a secured party is entered into the UCC information management system but is not indexed.</text> </paragraph> <paragraph num="(d)"> <text>If the amendment is a continuation, a new lapse date is established for the financing statement and maintained as part of its record.</text> </paragraph> </paragraph> <paragraph num="(10)"> <text>Termination Statement. A termination statement shall cause the filing office to designate the financing statement as “terminated”.</text> </paragraph> <paragraph num="(11)"> <text>Correction Statement. A record that bears the acknowledgment number for the correction statement and the date and time of filing is created for the correction statement. The record of the correction statement is associated with the record of the related initial financing statement in a manner that causes the correction statement to be retrievable each time a record of the financing statement is retrieved.</text> </paragraph> <paragraph num="(12)"> <text>Archives. The filing office shall act on any UCC record filed with the filing office by adding information obtained from the UCC record to the information system. The filing office may not act on any UCC record by deleting any information from the information system. A record will be maintained indefinitely in the UCC management information system of the filing office regardless of the status of the financing statement.</text> </paragraph> </paragraph> </regulation> <annotations> <annotation type="Authority">Commercial Law Article, §9-526, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: July 1, 2001 (28:12 Md. R. 1112)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03A amended effective July 4, 2016 (43:13 Md. R. 714)</annotation> </annotations> </chapter> </subtitle> <subtitle num="15" heading="Ground Rents"> <chapter num="01" heading="Redemption"> <regulation prefix="Regulation" num=".01" heading="Scope."> <text>This chapter applies to the redemption of reversions in leases under Real Property Article, §8-804, Annotated Code of Maryland, filed on or after January 1, 2004.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Documentation of Lease by Tenant."> <text>To redeem a reversion in a lease under Real Property Article, §8-804, Annotated Code of Maryland, a tenant shall file with the Department of Assessments and Taxation:</text> <paragraph num="A."> <text>A copy of:</text> <paragraph num="(1)"> <text>The publicly recorded lease creating the leasehold on the property and ground rent interest of the landlord; or</text> </paragraph> <paragraph num="(2)"> <text>Any publicly recorded documents establishing the existence of the lease;</text> </paragraph> </paragraph> <paragraph num="B."> <text>A copy of the publicly recorded deed, deed of assignment, or other document of transfer by which the current tenant received an interest in the property;</text> </paragraph> <paragraph num="C."> <text>An application form prescribed by the Department which includes, but is not limited to, the:</text> <paragraph num="(1)"> <text>Tenant's name and address;</text> </paragraph> <paragraph num="(2)"> <text>Address of the property subject to the ground rent;</text> </paragraph> <paragraph num="(3)"> <text>Property account number in the Department's records for the subject property; and</text> </paragraph> <paragraph num="(4)"> <text>Tenant's affidavit certifying that the requirements of Real Property Article, §8-804, Annotated Code of Maryland, have been met;</text> </paragraph> </paragraph> <paragraph num="D."> <text>If the tenant has received a bill for ground rent or other communication from the ground lease holder regarding the ground rent during the 3 years immediately before the filing of the documentation required by this regulation:</text> <paragraph num="(1)"> <text>A copy of the correspondence from the tenant notifying the landlord of tenant's intention to redeem the ground rent; and</text> </paragraph> <paragraph num="(2)"> <text>Proof of mailing from the United States Postal Service of the notice to the landlord by certified mail; and</text> </paragraph> </paragraph> <paragraph num="E."> <text>Pay any fees required by Corporations and Associations Article, §1-203, and Real Property Article, §8-804, Annotated Code of Maryland.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Calculation of Redemption Amount."> <paragraph num="A."> <text>The Department shall:</text> <paragraph num="(1)"> <text>Calculate the ground rent redemption amount as if no ground lease payments have been made by or on behalf of the tenant to the ground lease holder during the 3 years immediately before the filing of the documentation required by Regulation .02 of this chapter; and</text> </paragraph> <paragraph num="(2)"> <text>Reduce the ground rent redemption amount if the tenant provides proof that ground lease payments have been made by or on behalf of the tenant to the ground lease holder during the 3 years immediately before the filing of the documentation required by Regulation .02 of this chapter.</text> </paragraph> </paragraph> <paragraph num="B."> <text>If a tenant is unable to document when the ground lease was originally executed or created, the Department shall calculate the redemption amount using the formula set forth in Real Property Article, §8-804(b)(2)(i)3, Annotated Code of Maryland.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Documentation of Claimant's Interest."> <text>To file a claim under Real Property Article, §8-804, Annotated Code of Maryland, a claimant shall:</text> <paragraph num="A."> <text>File a copy of the publicly recorded documents establishing the claimant as the current landlord to the satisfaction of the Department;</text> </paragraph> <paragraph num="B."> <text>If the claimant is the landlord and a natural person, submit a notarized affidavit acknowledged under oath to the</text> </paragraph> <paragraph num="C."> <text>If the claimant is the landlord and an entity, provide proof of identity and current existence, which may include documents on file in public records;</text> </paragraph> <paragraph num="D."> <text>If the claimant is an heir or devisee of the landlord, file:</text> <paragraph num="(1)"> <text>Copies of the will, final probate orders, and accounting statements or other publicly recorded document showing that the claimant is entitled to the interest of the landlord; and</text> </paragraph> <paragraph num="(2)"> <text>Identification of the type described in §B or C of this regulation;</text> </paragraph> </paragraph> <paragraph num="E."> <text>If the claimant is a creditor of the landlord, provide:</text> <paragraph num="(1)"> <text>Satisfactory proof of any lien on the ground rent interest; and</text> </paragraph> <paragraph num="(2)"> <text>Identification of the type described in §B or C of this regulation; and</text> </paragraph> </paragraph> <paragraph num="F."> <text>Pay any fees required by Corporations and Associations Article, §1-203, and Real Property Article, §8-804, Annotated Code of Maryland.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Internet Posting."> <paragraph num="A."> <text>The Department will place on its website a link from the real property system to a ground rents filing system showing each property for which an application for ground rent redemption has been made.</text> </paragraph> <paragraph num="B."> <text>If a ground rent redemption filing exists, the ground rents filing system will provide information showing that a redemption:</text> <paragraph num="(1)"> <text>Application has been filed;</text> </paragraph> <paragraph num="(2)"> <text>Certificate has been issued; and</text> </paragraph> <paragraph num="(3)"> <text>Payment has been authorized by the Department.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Issuance of Redemption Certificates."> <text>The Department will issue the ground rent redemption certificate:</text> <paragraph num="A."> <text>90 days after the posting of the notice of the application on the Department's website; and</text> </paragraph> <paragraph num="B."> <text>After the redemption amount has been paid by the tenant to the Department.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Payment Methods."> <paragraph num="A."> <text>The tenant shall pay the redemption amount to the Department either by certified check or money order unless the tenant is a government or subdivision of a government.</text> </paragraph> <paragraph num="B."> <text>The Department will authorize a redemption payment to the State Treasurer and a check payment will be mailed by first class mail to the claimant.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Real Property Article, §8-804; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: March 15, 2004 (31:5 Md. R. 451)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01 amended effective December 6, 2018 (45:24 Md. R. 1162)</annotation> <annotation type="History" subtype="Administrative History">Regulation .02 amended effective December 6, 2018 (45:24 Md. R. 1162); February 24, 2020 (47:4 Md. R. 263)</annotation> <annotation type="History" subtype="Administrative History">Regulation .03 amended effective December 6, 2018 (45:24 Md. R. 1162)</annotation> <annotation type="History" subtype="Administrative History">Regulation .06A amended effective February 24, 2020 (47:4 Md. R. 263)</annotation> <annotation type="History" subtype="Administrative History">Chapter revised effective January 24, 2022 (49:2 Md. R. 78)</annotation> </annotations> </chapter> <chapter num="02" heading="Registration"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Current ground rent deed of record” has the meaning stated in Real Property Article, §8-701(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Department” has the meaning stated in Real Property Article, §8-701(c), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Ground lease” has the meaning stated in Real Property Article, §8-701(d), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Ground lease holder” has the meaning stated in Real Property Article, §8-701(e), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(5)"> <text>“Register” means to submit to the Department, for each ground rent:</text> <paragraph num="(a)"> <text>The Department's completed registration form; and</text> </paragraph> <paragraph num="(b)"> <text>Any appropriate registration fee.</text> </paragraph> </paragraph> <paragraph num="(6)"> <text>Submit.</text> <paragraph num="(a)"> <text>“Submit” means to cause the Department to receive only by:</text> <paragraph num="(i)"> <text>Hand delivery;</text> </paragraph> <paragraph num="(ii)"> <text>Regular mail postmarked with a date on or before the time allowed for the action; or</text> </paragraph> <paragraph num="(iii)"> <text>Specific electronic means approved by the Department.</text> </paragraph> </paragraph> <paragraph num="(b)"> <text>“Submit” does not mean delivery by:</text> <paragraph num="(i)"> <text>Facsimile; or</text> </paragraph> <paragraph num="(ii)"> <text>Any means other than those set forth above in §B(6)(a) of this regulation.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(7)"> <text>“Substantially completed registration form” means one that:</text> <paragraph num="(a)"> <text>Has a response for each question;</text> </paragraph> <paragraph num="(b)"> <text>Is legible; and</text> </paragraph> <paragraph num="(c)"> <text>Is sufficiently accurate to allow the Department to reasonably identify the property for which the ground lease was created.</text> </paragraph> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Registration Deadline."> <text>As provided in Real Property Article, §8-707(a), Annotated Code of Maryland, and subject to Real Property Article, §8-707(b), Annotated Code of Maryland, a ground lease holder shall register a ground lease with the Department before September 30, 2010.</text> </regulation> <regulation prefix="Regulation" num=".03" heading="Duties and Responsibilities."> <paragraph num="A."> <text>The Department's duties and responsibilities respecting the registration of ground rents are ministerial. In registering a ground rent or refusing to register a ground rent pursuant to this chapter, the Department does not:</text> <paragraph num="(1)"> <text>Determine that a ground rent does or does not exist;</text> </paragraph> <paragraph num="(2)"> <text>Determine that a lot does or does not exist;</text> </paragraph> <paragraph num="(3)"> <text>Determine that information contained in a registration form is correct or incorrect, in whole or in part; or</text> </paragraph> <paragraph num="(4)"> <text>Create a presumption that the information contained in a registration form is correct or incorrect, in whole or in part.</text> </paragraph> </paragraph> <paragraph num="B."> <text>The responsibility for the legal effectiveness of a ground rent registration rests with the ground lease holder. The Department bears no responsibility for effectiveness.</text> </paragraph> <paragraph num="C."> <text>The Department and its employees and agents are immune from any liability resulting from inaccurate, incomplete, or illegible information submitted in a ground rent registration form.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Substantially Completed Registration Forms."> <text>The Department may register a ground lease for which a substantially completed registration form has been submitted.</text> </regulation> <regulation prefix="Regulation" num=".05" heading="Inconsistent or Incomplete Information."> <text>If any information requested on a registration form has not been provided or if, for any other reason, the Department is unable to register a ground lease for which a registration form and appropriate fee has been submitted:</text> <paragraph num="A."> <text>The Department shall notify the ground lease holder of that ground lease, within 30 days of processing the registration form, of any information needed by the Department to complete the registration; and</text> </paragraph> <paragraph num="B."> <text>The ground lease holder shall have up to 30 days from the date on the Department's notice to submit the needed information before the ground lease is considered not registered under Real Property Article, §8-707, Annotated Code of Maryland.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Consolidated or Subdivided Lots."> <text>When a ground rent is attempted to be registered for a tax identification number that no longer exists due to consolidation or subdivision of the associated lot, the Department will register the ground rent using the currently existing tax identification number that most closely identifies the consolidated or subdivided lot.</text> </regulation> <annotations> <annotation type="Authority">Real Property Article, §8-710; Tax-Property Article, §2-201; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: September 20, 2010 (37:19 Md. R. 1285)</annotation> <annotation type="History" subtype="Administrative History">Regulation .01B amended effective December 6, 2018 (45:24 Md. R. 1163)</annotation> <annotation type="History" subtype="Administrative History">Regulation .05 amended effective December 6, 2018 (45:24 Md. R. 1163)</annotation> </annotations> </chapter> </subtitle> <subtitle num="16" heading="Rate Stabilization Property"> <chapter num="01" heading="General Provisions"> <regulation prefix="Regulation" num=".01" heading="Scope."> <text>The regulations set forth in this subtitle are effective with respect to any filing on or after July 1, 2006.</text> </regulation> <regulation prefix="Regulation" num=".02" heading="Definitions."> <paragraph num="A."> <text>In this subtitle, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Amendment” means a record that amends a previously filed record.</text> </paragraph> <paragraph num="(2)"> <text>“Assignee” has the meaning stated in Public Utilities Article, §7-520(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Assignor” means an electric company or other person that transfers an interest in rate stabilization property to an assignee.</text> </paragraph> <paragraph num="(4)"> <text>“Case number” means a number assigned by the Commission to a docketed matter.</text> </paragraph> <paragraph num="(5)"> <text>“Commission” means the Public Service Commission of Maryland, including a duly appointed successor entity.</text> </paragraph> <paragraph num="(6)"> <text>“Correction” means a record that corrects a previously filed record.</text> </paragraph> <paragraph num="(7)"> <text>“Date of delivery of transfer documents to assignee” means the date of delivery of documents pursuant to Public Utilities Article, §7-542(c), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(8)"> <text>“Date value received for rate stabilization bonds” means the date certain that consideration is received for rate stabilization bonds.</text> </paragraph> <paragraph num="(9)"> <text>“Electric company” has the meaning stated in Public Utilities Article, §7-521, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(10)"> <text>“Filing” means presenting a record to the filing office.</text> </paragraph> <paragraph num="(11)"> <text>“Filing date” means the date on which the filing office is presented with a record as evidenced by a notation on the record and a permanent entry in the information management system of the filing office.</text> </paragraph> <paragraph num="(12)"> <text>“File number” means a unique identifying number assigned by the information management system of the filing office to a record filed pursuant to this subtitle.</text> </paragraph> <paragraph num="(13)"> <text>“Filing office” means the State Department of Assessments and Taxation.</text> </paragraph> <paragraph num="(14)"> <text>“Filing party” means a person that makes a filing pursuant to this subtitle.</text> </paragraph> <paragraph num="(15)"> <text>“Filing time” means the time of day at which the filing office is presented with a record as evidenced by a notation on the record and a permanent entry in the information management system of the filing office.</text> </paragraph> <paragraph num="(16)"> <text>“Financing party” has the meaning stated in Public Utilities Article, §7-520(c), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(17)"> <text>“Grantor” means an electric company or other person that grants a security interest in a rate stabilization property to another entity.</text> </paragraph> <paragraph num="(18)"> <text>“Person” has the meaning stated in Public Utilities Article, §1-101(m), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(19)"> <text>“Qualified rate order” has the meaning stated in Public Utilities Article, §7-520(d), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(20)"> <text>“Qualified rate stabilization charge” has the meaning stated in Public Utilities Article, §7-520(e), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(21)"> <text>“Rate stabilization bond” has the meaning stated in Public Utilities Article, §7-520(f), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(22)"> <text>“Rate stabilization cost” has the meaning stated in Public Utilities Article, §7-520(g), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(23)"> <text>“Rate stabilization property” has the meaning stated in Public Utilities Article, §7-520(i), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(24)"> <text>Record.</text> <paragraph num="(a)"> <text>“Record” means a document filed with the filing office on the form approved by the filing office entitled “Rate Stabilization Property Notice”.</text> </paragraph> <paragraph num="(b)"> <text>“Record” includes:</text> <paragraph num="(i)"> <text>The notice of a security interest in rate stabilization property pursuant to Public Utilities Article, §7-542(b), Annotated Code of Maryland, and all amendments, corrections, and terminations related to that notice; and</text> </paragraph> <paragraph num="(ii)"> <text>The notice of sale and transfer to an assignee of an interest (other than a security interest) in rate stabilization property and all amendments, corrections, and terminations related to that notice.</text> </paragraph> </paragraph> </paragraph> <paragraph num="(25)"> <text>“Termination” means a record that indicates that the related rate stabilization property notice has ceased to be effective as to the financing party or assignee authorizing the termination.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Duties and Responsibilities."> <paragraph num="A."> <text>The duties and responsibilities of the filing office with respect to the filing of records pursuant to this subtitle are ministerial.</text> </paragraph> <paragraph num="B."> <text>In accepting or refusing to accept a record, the filing office does not:</text> <paragraph num="(1)"> <text>Determine the legal sufficiency or insufficiency of a record;</text> </paragraph> <paragraph num="(2)"> <text>Determine that a security interest in rate stabilization property exists or does not exist;</text> </paragraph> <paragraph num="(3)"> <text>Determine that information in the record is correct or incorrect, in whole or in part; or</text> </paragraph> <paragraph num="(4)"> <text>Create a presumption that information in the record is correct or incorrect, in whole or in part.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The responsibility for the legal effectiveness of a record rests with the filing party and the filing office bears no responsibility for effectiveness.</text> </paragraph> <paragraph num="D."> <text>The State and the filing office and its employees, agents, and servants are immune from liability occurring as a result of errors in or omissions of information provided from the filing office's information management system or any other errors or omissions with respect to filings.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Date, Time, and Method of Filing."> <paragraph num="A."> <text>A record shall be filed with the filing office by the filing party.</text> </paragraph> <paragraph num="B."> <text>A record shall be filed on the form approved by the filing office or an identical replication of the form.</text> </paragraph> <paragraph num="C."> <text>Hand delivery to the filing office shall be the sole method for filing a record.</text> </paragraph> <paragraph num="D."> <text>The filing office is open to the public between the hours of 8:30 a.m. and 5 p.m., Monday through Friday, except for State holidays.</text> </paragraph> <paragraph num="E."> <text>The filing date and filing time of a record shall be as defined in Regulation .02 of this chapter.</text> </paragraph> <paragraph num="F."> <text>The filing office shall assign a unique file number to a record.</text> </paragraph> <paragraph num="G."> <text>An acknowledgement of acceptance by the filing office of a record shall be provided to the filing party.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Grounds for Refusal of a Record."> <text>The filing office shall refuse to accept a record and provide an explanation for the refusal if:</text> <paragraph num="A."> <text>An item on the record fails to contain a required entry by the filing party;</text> </paragraph> <paragraph num="B."> <text>An entry on the record fails to be legible and capable of being imaged by the filing office's information management system;</text> </paragraph> <paragraph num="C."> <text>A record purporting to add an assignor, grantor, financing party, or assignee fails to include a legible name and address of the assignor, grantor, financing party, or assignee;</text> </paragraph> <paragraph num="D."> <text>A record fails to identify itself as a new or supplemental filing;</text> </paragraph> <paragraph num="E."> <text>A record, when applicable, fails to indicate its purpose or fails to provide the file number of the affected rate stabilization property notice existing in the information management system of the filing office;</text> </paragraph> <paragraph num="F."> <text>A record fails to include the information requested on the approved form as to whether the notice relates to all or a portion of the recovery permitted under a qualified rate order;</text> </paragraph> <paragraph num="G."> <text>A record fails to include in legible form the:</text> <paragraph num="(1)"> <text>Qualified rate order number and case number;</text> </paragraph> <paragraph num="(2)"> <text>Name of the electric company in the order;</text> </paragraph> <paragraph num="(3)"> <text>Date that value is received for the rate stabilization bonds;</text> </paragraph> <paragraph num="(4)"> <text>Signatures and names of the assignor or grantor and assignee or financing party; or</text> </paragraph> <paragraph num="(5)"> <text>If an assignment, date of delivery of the transfer documents to the assignee; or</text> </paragraph> </paragraph> <paragraph num="H."> <text>A record includes any other entry or omission inconsistent with the purpose and intent of the Public Utilities Article, Annotated Code of Maryland.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Public Utilities Article, §7-542(d), Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: March 26, 2007 (34:6 Md. R. 628)</annotation> </annotations> </chapter> <chapter num="02" heading="Information Management System"> <regulation prefix="Regulation" num=".01" heading="Indices."> <paragraph num="A."> <text>The filing office shall maintain a unique computer index of records.</text> </paragraph> <paragraph num="B."> <text>Each record shall be indexed by:</text> <paragraph num="(1)"> <text>Assignee or financing party;</text> </paragraph> <paragraph num="(2)"> <text>Assignor or grantor;</text> </paragraph> <paragraph num="(3)"> <text>File number; and</text> </paragraph> <paragraph num="(4)"> <text>Qualified rate order number.</text> </paragraph> </paragraph> <paragraph num="C."> <text>A record shall be retrievable by each index.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Record Availability."> <paragraph num="A."> <text>All records shall be available on the filing office's website as imaged documents.</text> </paragraph> <paragraph num="B."> <text>All records shall be permanently maintained.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Public Utilities Article, §7-542(d), Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: March 26, 2007 (34:6 Md. R. 628)</annotation> </annotations> </chapter> </subtitle> <subtitle num="17" heading="Affordable Housing Land Trusts"> <chapter num="01" heading="Registration"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Affordable housing land trust” has the meaning stated in Real Property Article, §14-501(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Department” has the meaning stated in Real Property Article, §14-503(a), Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Register” means to submit to the Department a completed registration form as prescribed by the Department.</text> </paragraph> <paragraph num="(4)"> <text>“Resident agent” has the meaning stated in Corporations and Associations Article, §1-101(s), Annotated Code of Maryland.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Name Requirements."> <text>The name of an affordable housing land trust must:</text> <paragraph num="A."> <text>Include the words “Affordable Housing Land Trust”; and</text> </paragraph> <paragraph num="B."> <text>Comply with Corporations and Associations Article, §1-504, Annotated Code of Maryland, and COMAR 18.04.02.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Resident Agent Requirement."> <text>An affordable housing land trust shall designate a resident agent and the street address of that resident agent at the time of registration.</text> </regulation> <regulation prefix="Regulation" num=".05" heading="Change of Resident Agent."> <text>An affordable housing land trust may change its resident agent by filing with the Department a statement that authorizes the change.</text> </regulation> <regulation prefix="Regulation" num=".06" heading="Change of Resident Agent’s Address."> <text>The resident agent of an affordable housing land trust may change the resident agent’s address by filing a statement with the Department:</text> <paragraph num="A."> <text>Signed by the resident agent or on behalf of the resident agent; and</text> </paragraph> <paragraph num="B."> <text>Including:</text> <paragraph num="(1)"> <text>The names of the affordable housing land trust for which the change is effective;</text> </paragraph> <paragraph num="(2)"> <text>The resident agent's old and new addresses; and</text> </paragraph> <paragraph num="(3)"> <text>The date on which the change is effective.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".07" heading="Effective Date."> <text>The change of resident agent or change of the resident agent’s address is effective when the Department accepts the statement for record.</text> </regulation> <regulation prefix="Regulation" num=".08" heading="Service of Process."> <text>Service of process on a resident agent designated by an affordable housing land trust is as effective as if served on one of its trustees.</text> </regulation> <regulation prefix="Regulation" num=".09" heading="Reporting Status."> <text>A nonprofit organization operating an affordable housing land trust that gives up or loses its nonprofit status or ceases to exist shall promptly report this information to the Department.</text> </regulation> <annotations> <annotation type="Authority">Tax Property Article, §2-201; Real Property Article, §14-503; Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: January 24, 2011 (38:2 Md. R. 85)</annotation> </annotations> </chapter> </subtitle> <subtitle num="18" heading="Homeowner Protection Program"> <chapter num="01" heading="General"> <regulation prefix="Regulation" num=".01" heading="Definitions."> <paragraph num="A."> <text>In this chapter, the following terms have the meanings indicated.</text> </paragraph> <paragraph num="B."> <text>Terms Defined.</text> <paragraph num="(1)"> <text>“Affidavit” means a sworn statement in writing on a form furnished by the Department and containing an oath or affirmation set forth in Maryland Rule 1-304, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(2)"> <text>“Applicant” means a person applying for enrollment in the Homeowner Protection Program as defined in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(3)"> <text>“Combined income” has the meaning stated in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(4)"> <text>“Dependent” has the meaning stated in 26 U.S.C.A. §152, United States Annotated Code.</text> </paragraph> <paragraph num="(5)"> <text>“Dwelling” has the meaning stated in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(6)"> <text>“Enrollee” means an applicant enrolled in the Homeowner Protection Program.</text> </paragraph> <paragraph num="(7)"> <text>“Homeowner” has the meaning stated in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(8)"> <text>“Ombudsman” has the meaning stated in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(9)"> <text>“Program” has the meaning stated in Tax-Property Article, §14-883, Annotated Code of Maryland.</text> </paragraph> <paragraph num="(10)"> <text>“Total outstanding tax debt” means the full amount of any property tax lien, any amount paid to the holder of a property tax sale certificate, or any other charge paid by the Department on behalf of a Program enrollee under Tax-Property Article, §14-801, Annotated Code of Maryland, including any interest as determined by the Department.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".02" heading="Application Procedures."> <paragraph num="A."> <text>The Department has established procedures to apply for the Program.</text> </paragraph> <paragraph num="B."> <text>Application Procedures.</text> <paragraph num="(1)"> <text>An applicant shall report the combined income corresponding to the dwelling for which application is made.</text> </paragraph> <paragraph num="(2)"> <text>An applicant may be required to submit copies of corresponding federal income tax returns and accompanying schedules and forms, along with other proof of combined income, as requested by the Ombudsman.</text> </paragraph> <paragraph num="(3)"> <text>An applicant having a substantial ownership interest in a business or partnership shall submit a complete copy of the federal tax return filed for that business or partnership.</text> </paragraph> <paragraph num="(4)"> <text>An applicant may be requested to complete an affidavit to substantiate any information reported on the application.</text> </paragraph> <paragraph num="(5)"> <text>An applicant seeking to exclude the income of a spouse on the basis of a marital separation shall submit a legal separation agreement or, if none exists, an affidavit stating the date of separation and whether their estranged spouse is likely to return to the dwelling house.</text> </paragraph> <paragraph num="(6)"> <text>An applicant claiming a person is a dependent who does not file a federal income tax return shall submit verification of the dependency status to the Ombudsman in an affidavit.</text> </paragraph> <paragraph num="(7)"> <text>An applicant failing or refusing to submit any information requested by the Ombudsman shall be denied enrollment for failure to substantiate the information reported.</text> </paragraph> </paragraph> <paragraph num="C."> <text>The Department may establish application procedures in addition to those set forth above if not inconsistent with these regulations.</text> </paragraph> </regulation> <regulation prefix="Regulation" num=".03" heading="Additional Eligibility Criteria."> <paragraph num="A."> <text>The Department has established additional eligibility criteria for the Program in accordance with Tax-Property Article, §14-885(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Additional Eligibility Criteria.</text> <paragraph num="(1)"> <text>Enrollment From Every County. The maximum number of homeowners who may be enrolled in the Program in a given fiscal year will be proportionately divided among the 23 counties and Baltimore City based on the percentage of Statewide property tax sales occurring within each jurisdiction, as determined by the Ombudsman.</text> </paragraph> <paragraph num="(2)"> <text>Limit on Total Outstanding Tax Debt. To ensure that homeowners are enrolled in the Program who reside in each jurisdiction in a given fiscal year, the Ombudsman may set a maximum amount of total outstanding tax debt that the Department will incur on behalf of any one dwelling.</text> </paragraph> <paragraph num="(3)"> <text>Affordability Requirement. The total outstanding tax debt paid by the Department on behalf of an enrollee under Tax-Property Article, §14-887, Annotated Code of Maryland, may not exceed an amount that may reasonably be expected to be repaid by the enrollee within a three-year period. Consideration will be given to the homeowner’s income, expenses other than total outstanding tax debt, and the likelihood of receiving tax credits, grants, and other benefits.</text> </paragraph> <paragraph num="(4)"> <text>Long-term homeowner enrollment preference. Applications from homeowners whose dwelling has been their principal residence for at least 10 years as of the date of application will be given enrollment preference over other applicants from the same jurisdiction.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".04" heading="Priorities."> <paragraph num="A."> <text>The Department has established enrollment priorities for the Program in accordance with Tax-Property Article, §14-885(b), Annotated Code of Maryland.</text> </paragraph> <paragraph num="B."> <text>Enrollment Priorities.</text> <paragraph num="(1)"> <text>Priority for Applicants Age 60 and Over. Applications from homeowners who are at least 60 years of age as of the date of application will be given priority enrollment over applicants from the same jurisdiction who are under 60.</text> </paragraph> <paragraph num="(2)"> <text>Priority for Applicants on Disability. Applications from homeowners who are receiving disability benefits from the federal Social Security Disability Insurance program or the federal Supplemental Security Income program as of the date of application will be given priority enrollment over applicants from the same jurisdiction who are not receiving such benefits.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".05" heading="Maintaining Enrollment."> <paragraph num="A."> <text>The Department has established requirements to maintain enrollment in the Program.</text> </paragraph> <paragraph num="B."> <text>Maintaining Enrollment.</text> <paragraph num="(1)"> <text>Regular Communication. An enrollee shall respond to communications from the Ombudsman within a reasonable time period as required by the Department. If an enrollee’s contact information changes, the updated contact information must be shared seasonably with the Ombudsman.</text> </paragraph> <paragraph num="(2)"> <text>Assistance Agreement. An enrollee must follow any assistance plan created for them by the Ombudsman. The assistance plan may include an obligation to:</text> <paragraph num="(a)"> <text>Apply for tax credits, grants, or other public benefits as recommended by the Ombudsman;</text> </paragraph> <paragraph num="(b)"> <text>Meet with housing and financial counselors and legal service providers; and</text> </paragraph> <paragraph num="(c)"> <text>Take advantage of other assistance strategies recommended by the Ombudsman to help an enrollee pay their total outstanding tax debt and improve their financial situation.</text> </paragraph> </paragraph> <paragraph num="(3)"> <text>Financial Information. When requested by the Ombudsman, an enrollee shall provide detailed and complete information about their financial situation to aid in developing an appropriate assistance strategy. An enrollee shall immediately report to the Ombudsman any significant changes to their financial circumstances as they occur.</text> </paragraph> <paragraph num="(4)"> <text>Repayment Requirement. For any total outstanding tax debt paid by the Department on behalf of an enrollee under Tax-Property Article, §14-887, Annotated Code of Maryland, the enrollee shall repay the Department in monthly installments based on a plan agreed upon during the enrollment process.</text> </paragraph> </paragraph> </regulation> <regulation prefix="Regulation" num=".06" heading="Collection Procedures"> <paragraph num="A."> <text>The Ombudsman may charge less interest under Tax-Property Article, §14-889, Annotated Code of Maryland, to enrollees who repay the Department using automatic electronic payments.</text> </paragraph> <paragraph num="B."> <text>The total outstanding tax debt owed by an enrollee to the Department will be recorded in land records as a lien attached to the enrollee’s dwelling until it is repaid.</text> </paragraph> </regulation> <annotations> <annotation type="Authority">Tax-Property Article, §§2-201 and 14-885, Annotated Code of Maryland</annotation> <annotation type="History" subtype="Administrative History">Effective date: December 12, 2022 (49:25 Md. R. 1052)</annotation> </annotations> </chapter> </subtitle>