Corporation Income Tax

The corporation income tax applies to every Maryland corporation and every other corporation that has a nexus with Maryland.

Effective January 1, 2008, the tax is imposed at an 8.25 percent rate on the Maryland taxable income, defined as the Maryland modified income, which is the corporation federal taxable income adjusted by state modifications. Corporations engaged in multistate operations must allocate Maryland modified income using an apportionment formula, generally consisting of receipts, property and payroll factors.

Certain corporations are also subject to new reporting requirements.

Maryland corporations may also be eligible for business tax credits which may be claimed against the corporation income tax by filing Form 500CR.

S corporations, partnerships and limited liability companies should not file a corporation income tax return. These businesses must file as pass-through entities.