Instructions For Form 500 - Maryland Corporation Income Tax Return

MARYLAND BUSINESS REGISTRATION & TAXATION

COMPTROLLER OF MARYLAND

manufacturing machinery and equipment, and

the Comptroller for deposit in the 911 Emergency

REGISTRATION & TAXES

certain agri cultural equipment and supplies.

Telephone System and Communications

Access of Maryland Funds.

Registration and Licensing All new businesses

Motor Fuel Tax Generally, this tax applies to

(corporations, S corporations, partnerships,

businesses selling or using motor fuel in

The utility surcharges are collected by the

limited liability companies, business trusts, and

Maryland.

Revenue Administration Division.

sole propri etorships) can file a single application

The Maryland motor fuel tax rate is currently

Direct Wine Shipper's Permit This permit is

with the Central Registration Unit of the

23½¢ per gallon of gasoline and 24¼¢ per

required for all in-state and out-of-state wine

Revenue Administration Division of the

gallon of diesel fuel. There are other require-

manufacturers that ship wine, including pomace

Comptroller’s Office to establish accounts for

ments for motor carriers, dealers, special fuel

brandy, directly to a Maryland consumer through

employer income tax withholding, sales and use

users, sellers, and service station operators.

a common carrier, such as Federal Express or

tax, admissions and amusement tax, tire

UPS.

Maryland implemented the International Fuel

recycling fee, motor fuel tax, alcohol and

Tax Agreement (IFTA) for motor carriers on

Common Carrier Permit This permit is required

tobacco tax and unemployment insurance. The

1/1/96.

for a common carrier to deliver wine to a

Revenue Administration Division offers

Maryland consumer.

assistance for filing applications and establishing

Alcohol and Tobacco Tax These taxes apply

accounts.

to businesses manufacturing, selling, distributing

OTHER REGISTRATIONS & TAXES

or storing alcoholic beverages or selling and/or

The Central Registration Unit assigns a single

New Corporations In addition to registering

distributing cigarettes and other tobacco

state identification number for the taxes listed

with the Central Registration Unit of the

products in Maryland.

above. Register online at

Comptroller’s Office, all corporations doing

com.

The Maryland excise tax rates on alcoholic

business in Maryland must register with the

beverages are $1.50 per gallon of distilled

Businesses may apply with the Licensing and

Department of Assessments and Taxation. This

spirits, 40¢ per gallon of wine, and 9¢ per gallon

Registration Unit of the Revenue Administration

is also the office to contact to form a new

of beer. The tobacco tax rate is $2.00 per pack

Division to obtain a direct wine shipper's permit

corporation.

of 20 cigarettes, the rate is 15% of the wholesale

and a common carrier permit.

Bay Restoration Fee This fee is collected by all

price for other tobacco products.

Corporation Income Tax The corporation

non-exempt local governmental entities, billing

Admissions and Amusement Tax This tax is

income tax applies to every Maryland

authorities, drinking water and sewage water

imposed on a variety of activities, such as

corporation and every other corporation which

treatment plant owners, who provide water or

admission to any place, including motion

has a nexus with Maryland. Nexus is the term

sewage services to residential, multi-residential,

pictures, athletic events, races, shows or

used to indicate a taxable connection between a

and non-residential users. County governments

exhibits. Also subject to this tax are receipts

corporation and a taxing authority. If a

are responsible for collecting a septic fee from

from athletic equipment rentals, bingo, coin-

corporation conducts business activity within

owners of private wells and septic systems. The

operated amusement devices, boat rides and

Maryland and exceeds the provisions of

fees are remitted by these entities quarterly to

excursions, amusement rides, golf green fees,

U.S.C.A. Title 15, Section 381 of the Interstate

the Comptroller for deposit to the Bay

golf cart rentals, skating, bowling shoe rentals,

Commerce Act (P.L. 86-272) it has a nexus and

Restoration Fund.

lift tickets, riding academies, horse rentals, and

must file an income tax return.

Public Service Company Franchise Tax In

merchandise, refreshments, or a service sold or

The tax is based on federal taxable income after

addition to corporation income tax, public

served in connection with entertainment.

state modifications. Corporations engaged in

service companies are subject to the franchise

The admissions and amusement tax is a local

multistate operations must allocate income

tax on gross receipts. This tax is administered

tax collected by the Comptroller’s Office on

using an apportionment formula, generally

by the Department of Assessments and

behalf of Maryland’s counties, Baltimore City,

consisting of receipts, property and payroll

Taxation.

other incorporated cities and towns. The tax is

factors. The tax is imposed at a flat rate of

Insurance Company Premium Tax Insurance

set by the localities at rates varying from one-

8.25% of Maryland taxable income.

companies are exempt from the corpora tion

half of 1% to 10% of the admissions and

Employer Withholding of Income Tax

income tax but are subject to the premium tax

amusement receipts. When the gross receipts

Employers making payments to individuals of

that is administered by the Maryland Insurance

are also subject to the sales and use tax, the

salaries, wages or compensation for personal

Administration.

combined tax rate may not exceed 11%.

services must withhold income tax and remit the

Unemployment Insurance Employers are

A separate State admissions and amusement

withholding to the Maryland Revenue

subject to the Department of Labor, Licensing

tax of 30% is imposed on the net proceeds from

Administration Division. The amount of tax to be

and Regulation unemployment insurance

electronic bingo or electronic tip jars. When the

withheld is prescribed in published tables which

require ments and must file a combined

net proceeds are also subject to a local tax, the

are based on the individual income tax rates.

registration application to establish an account.

combined tax rate may not exceed 35%.

Sales and Use Tax This tax applies to

Workers’ Compensation Employers in

Tire Recycling Fee This fee applies to tire

businesses selling in Maryland or purchasing

Maryland must provide workers’ compensation

wholesalers or a tire retailer who buys tires from

out of state for Maryland use.

insurance for all employees. Employers may

out-of-state sources. Registration and payment

The general Maryland sales and use tax rate is

obtain coverage from a private insurance

of the fee is handled by the Revenue

6%. A special 8% rate is imposed on rental

company, by becoming self-insured or by

Administration Division.

trucks, and a special rate of 11½% is charged

contacting the State Injured Workers’ Insurance

Utility Surcharges These surcharges are

on rentals of passenger cars and recreational

Fund. Employers believing they are not required

collected by electric companies that deliver

vehicles. A special 9% tax rate is also imposed

to obtain this insurance may contact the

electricity in Maryland and by telephone

on alcoholic beverages. Most sales of food by

Workers’ Compensation Commission for

companies doing business in Maryland. The

substantial grocery or market businesses are

certification of compliance.

electricity surcharges are then paid to the

not subject to tax. Specific prepared foods

Business Licenses Licenses are required for

Comptroller for deposit in the Environmental

purchased in grocery stores are subject to tax.

certain businesses to operate in Maryland. To

Trust and Universal Service Program Funds.

Other exemptions include all sales solely for

determine if a license is necessary, contact the

The telecommunications surcharges are paid to

resale, medicine, energy for residential use,

Instructions For Form 500 - Maryland Corporation Income Tax Return - 2011 Page 11

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