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MD SB163

Bill

Status

Engrossed

2/17/2026

Primary Sponsor

Chris West

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Origin

Senate

2026 Regular Session

AI Summary

  • Exempts foreign earned income from Maryland's addition modification that normally requires residents to add back federally tax-exempt income to their state taxable income
  • Foreign earned income qualifying for this exemption must meet the definition under Internal Revenue Code § 911(b)(1) and is subject to the limitation under IRC § 911(b)(2)
  • Salary, wages, and other personal service compensation exempted by federal law or treaty from federal tax remains subject to Maryland's addition modification
  • Takes effect July 1, 2026, and applies to all taxable years beginning after December 31, 2025
  • Sponsored by Senators West and McCray; received favorable committee report with amendments from Budget and Taxation Committee

Legislative Description

Income Tax - Addition Modification for Federal Tax-Exempt Income - Alterations

Income Tax

Last Action

Hearing 3/24 at 1:00 p.m.

3/16/2026

Committee Referrals

Ways and Means2/18/2026
Budget and Taxation1/14/2026

Full Bill Text

No bill text available