Tax Amnesty Being Offered to Maryland Residents

ANNAPOLIS, MD - A tax holiday will begin on September 1st for Maryland residents.

Anyone who owes back taxes to the state will have a chance to pay them off without penalty and at half the interest owed.

The last time the state offered tax amnesty was in 2001, and officials say it raised nearly 30 million dollars for the state's general fund.

If you want to pay back taxes during the amnesty period you must agree to pay the full amount of the taxes plus half of the interest by January 2011.

Governor Martin O'Malley plans to officially announce the start of the holiday Monday morning.

The governor's office issued the following press release:

Governor Martin O'Malley, joined today by Lieutenant Governor Anthony Brown, Senate President Thomas V. Mike Miller, Jr., House Speaker Michael E. Busch, Ronald Wineholt of the Maryland Chamber of Commerce, and others to announce Maryland's first tax amnesty holiday since 2001. The amnesty period, which begins September 1 and runs through October 30, is a result of legislation passed during the 2009 legislative session and allows those Marylanders who owe back taxes to the state to pay those taxes free of penalty and at half the interest accrued.

"This tax amnesty holiday allows individuals, families, and small businesses who may have fallen behind the opportunity to make things right without excessive penalty or interest," said Governor O'Malley. "Consistent with many of the suggestions we've received from members of the public, we're implementing this holiday as we work to reform our government in these difficult economic times to make it more efficient and effective for the people of Maryland."

"Governor O'Malley has forged the partnerships and made the difficult choices that are required during tough economic times and he understands that Maryland's working families are struggling every day to do more with less," Lt. Governor Brown said. "The tax amnesty provides those individuals who have fallen behind during these tough times to get caught up without penalty and help Maryland keep its promise to future generations. While the choices we have made have been difficult, they are choices that will help us survive this recession and thrive for decades to come."

It is estimated that for every $10 million raised by the upcoming holiday the State will add $7.2 million to the General Fund. The remaining revenue will go toward local governments and the Transportation Trust Fund. During the last such holiday in 2001, the State collected $39.5 million in revenue.

"Tax amnesty is a win-win for Marylanders and their government. It gives families and businesses that have fallen behind as a result of the global recession a one-time opportunity to avoid penalties, and the State an opportunity to collect sorely-needed revenue," said Senate President Thomas V. Mike Miller, Jr. "On behalf of working families and small businesses in Maryland, I want to thank Senator Ed DeGrange for championing this issue during the legislative session."

"The economic meltdown caught many people by surprise, leaving many families and small businesses to struggle to make ends meet," said Senator James (Ed) DeGrange, Sr. "This program creates a one-time opportunity for these people to come forward without facing penalties, so that they can get back on track."

It is estimated that approximately 177,000 individual income tax accounts and 18,000 business tax accounts are delinquent in the State of Maryland, accounting for as much as a half billion dollars. This two month amnesty period provides payment plan options for the Maryland Comptroller's office. In order to be eligible for the 2009 holiday, all payments must be received by December 31, 2010.

"Tax amnesty gives a second chance to Marylanders wanting to do the right thing and comply with the law," said Speaker Michael E. Busch. "I commend the Governor and the legislature for recognizing the value of a program like this during these tough economic times."

"The tax amnesty program is an innovative way for the state to generate revenue without harming our hard working families, revenue which will help us avoid making millions more in painful reductions to vital services. I was proud to have been a part of its passage in the legislature," said Delegate John Olszewski, a member of the Ways Means Committee and in whose district today's event took place.

"Governor O'Malley and the General Assembly have recognized that many small businesses are struggling to pay their bills," said Ron Wineholt, Vice President for Government Affairs with the Maryland Chamber of Commerce. "Therefore, we strongly urge any business that has fallen behind on their state tax liability to take advantage of Maryland's Tax Amnesty program. You'll never get a better deal."

The 2009 Maryland Tax Amnesty holiday is a result of the passage of SB552, sponsored by Senator James DeGrange and signed into law by Governor O'Malley in May. The holiday applies to income, sales, withholding and other taxes, allowing citizens to pay back-taxes free of penalties and one-half the interest due.

For more information about the tax amnesty holiday, visit the Maryland Comptroller's website at www.marylandtaxes.com, call 1-800-MDTAXES, or visit www.maryland.gov. Read more atyour4state.com.