Bill > HB35

This bill establishes an Income Tax Benefit Transfer Program for technology companies in Maryland, allowing eligible technology companies to transfer their unused tax benefits (such as net operating loss modifications or research and development tax credits) to other taxpayers for cash consideration. To be eligible, a technology company must be a for-profit corporation headquartered in Maryland, engaged in innovative technology research or development, and meet specific employee count requirements based on how long they've been incorporated (ranging from at least 1 to 10 qualified employees). The Department of Commerce will administer the program, with an annual cap of $35 million in total tax benefit transfers and a lifetime maximum of $15 million per eligible technology company. The transferred tax benefits must be used to fund business expenses like fixed assets, research and development, salaries, and working capital. The program aims to support technology sector growth by providing financial flexibility for innovative companies. Companies must maintain their Maryland headquarters for 5 years after receiving benefits or risk having the tax benefit transfer recaptured. The program will take effect on July 1, 2025, and apply to taxable years beginning after December 31, 2024.

Budget and Finance

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/HB0035?ys=2025RS