Small businesses with less than $20,000 in assets are now exempt from MD personal property tax

On July 11, 2022, the Maryland State Department of Assessments & Taxation (SDAT) announced that Maryland businesses with less than $20,000 in personal property assets are now exempt from the annual personal property tax assessment under HB268. The new legislation officially took effect on June 1, 2022, raising the tax exemption threshold from $2,500 to $20,000.

Now, more than 42,000 small businesses in Maryland will not have to pay taxes on roughly $55 million in assessments. However, all Maryland businesses will still be required to file an annual personal property return with SDAT regardless of their exemption status.


Self-Certification

Beginning in 2023, businesses will be able to self-attest on their Annual Report that their personal property falls within the exemption range and will no longer be required to submit a return detailing their personal property. This will relieve small businesses throughout the state from the significant burden of tracking the original cost and year-after-year depreciation for personal property totaling less than $20,000.


Late-Filing Penalties Abated for 2022 Returns

SDAT has abated the late-filing penalties previously assessed on 2022 business personal property returns that reported less than $20,000. SDAT will also be issuing refund checks in the mail to those eligible businesses that paid the late-filing penalty assessments.


 
About the Author

Attorney Jordan D. Howlette is the founder and managing attorney of JD Howlette Law, a civil litigation and business law firm focused on delivering high-quality legal services to individuals and businesses in a timely, cost-efficient manner. Prior to establishing JD Howlette Law, Mr. Howlette worked as trial attorney in the Tax Division of the U.S. Department of Justice, where he successfully litigated dozens of civil tax cases on behalf of the United States in federal courts around the country, securing millions of dollars in favorable judgments while also advocating for equitable justice. He is intimately familiar with the procedures, strategies, and processes of litigating cases from start to finish in court and with resolving multi-faceted civil disputes involving high-dollar amounts, complex statutory and regulatory provisions, and diverse parties from different jurisdictions.


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