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Employer-Provided Long-Term Care Insurance Tax Credit

An employer, including organizations exempt from taxation under 501(c)(3) or (4) of the Internal Revenue Code, that provides long-term care insurance as part of an employee benefit package may claim a credit for costs incurred during the taxable year.

The credit may be taken against corporate income tax, personal income tax, insurance premiums tax or public service company franchise tax. The same credit may not, however, be applied to more than one tax type.

Sole proprietorships, corporations and pass-through entities, such as partnerships, subchapter S corporations, limited liability companies and business trusts may claim the tax credit.

To qualify for the credit:

The company must provide long-term care insurance benefits to one or more employees during the taxable year as part of an employee benefits package.

How the credit is calculated:

The credit allowed is 5% of employer's cost which may not exceed the lesser of $5,000, or $100 for each employee in the State covered by long-term care insurance provided under the employee benefits package.

If the credit is more than the tax liability, the unused credit may be carried forward for the next five (5) tax years.

Documentation required:

For taxable year beginning after December 31, 2012, taxpayers must file their income tax return electronically (Form 500 for Corporations, Form 510 and Form 510 Schedule K-1 for Pass-Through Entities, and Form 502 or 505 for Individuals). They must complete the Business Tax Credit Form 500CR section of the electronic return to claim this tax credit.

Insurance premium tax:

Documentation of the credit shall be maintained by the taxpayer in their files and be made available to the Insurance Commissioner, on request, in accordance with COMAR 31.06.04.03. The documentation should include documents from the agency granting the credit and a list of the names and telephone numbers for the taxpayer's staff who are directly involved in granting the credits. All information shall be retained for a minimum of three years from the date of the filing of the final tax return on which the credit is taken.

Public service company franchise tax:

Form AT3-74 must be submitted with the franchise tax return (SDAT forms 11 or 11T).

Contact:

Comptroller of Maryland
Revenue Administration Division
110 Carroll Street
Annapolis, MD 2141
Phone: 410-260-7980 from Central Maryland,
1-800-MD TAXES from elsewhere
E-mail: taxhelp@comp.state.md.us

or:

State Department of Assessments and Taxation
301 West Preston Street
Baltimore, MD 21201-2395
Phone: 410-767-1191
E-mail: taxcredits@dat.state.md.us



 
Links for Business Tax Credits
General Information
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  Businesses That Create New Jobs Tax Credit
  Cellulosic Ethanol Technology Research and Development Tax Credit
  Clean Energy Incentive Tax Credit
  Community Investment Tax Credit
  Commuter Tax Credit
  Cybersecurity Investment Incentive Tax Credit
  Electric Vehicle Recharging Equipment Tax Credit
  Employer-Provided Long-Term Care Insurance Tax Credit
  Employer Security Clearance Costs Tax Credits
  Employment Opportunity Tax Credit
  Enterprise Zone Tax Credit
  Film Production Activity Tax Credit
  Green Building Tax Credit
  Health Enterprise Zone Hiring Tax Credit
  Job Creation Tax Credit
  Long-Term Employment of Ex-Felons Tax Credit
  Maryland Disability Employment Tax Credit
  Maryland-Mined Coal Tax Credit
  One Maryland Economic Development Tax Credit
  Oyster Shell Recycling Tax Credit
  Qualified Vehicle Tax Credit
  Research and Development Tax Credits
  Heritage Structure Rehabilitation Tax Credit
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