MD HB1256

Creates a state income tax credit of 33% (up to $250,000) for investments of at least $25,000 in qualified Maryland companies in advanced manufacturing, biosciences, cybersecurity, technology, or other designated sectors; increases to 50% (up to $500,000) for companies in Allegany, Dorchester, Garrett, or Somerset Counties

Qualified Maryland companies must have headquarters and base of operations in the state, fewer than 50 full-time employees, at least $100,000 in capitalization, non-publicly traded securities, and cannot have participated in the program for more than 3 prior fiscal years

Establishes the Angel Investor Tax Credit Reserve Fund with a minimum annual appropriation of $2,000,000; limits credits to 15% of the fund for any single company and 25% for any single economic sector per fiscal year

Requires credit recapture if within 2 years the investor sells the ownership interest, the company ceases Maryland operations, or distributes the investment as dividends (100% recapture in year one, 67% in year two, 33% in year three)

Takes effect July 1, 2026, applies to taxable years beginning after December 31, 2025, and automatically sunsets on June 30, 2036