Earned Income Tax Credit (EITC)

Rates:

  • Refundable: Currently 26% of federal EITC, rising to 27% January 1, 2017 and 28% January 1, 2018.
  • Non-Refundable: 50% of federal EITC1

Eligibility Requirements: See Maryland’s EITC information page

Latest Legislative Action:

In the 2016 legislative session, a bill that would have increased the state’s EITC for childless workers and lower the EITC’s age requirement from 25 to 21 stalled due to disagreements over tax breaks for the wealthy.2

Notes:

  • The non-refundable credit is equal to the lesser of 50% of the federal credit or the state income tax liability in the taxable year. If the nonrefundable credit reduces a taxpayer’s liability to zero, the taxpayer is eligible to claim a refundable credit equal to 26% of the federal credit in tax year 2016, minus any pre-credit state tax liability.3
  • Montgomery County, a large suburban county neighboring the District of Columbia, is one of three counties in the United States to offer a local EITC in addition to the state credit. Eligible families that filed for the EITC receive a county credit equal to 100% of the state’s refundable credit.4

Child Tax Credit (CTC)

State CTC: The state of Maryland does not currently offer a state level Child Tax Credit.

Child and Dependent Care Tax Credit (CDCTC)

State CDCTC Rates (Non-Refundable):

  • For filers with adjusted gross incomes up to $41,001: 32.5% of federal CDCTC5
  • For filers with incomes between $41,001 and $50,001: 29.25%-3.25% of federal CDCTC, phased out with each additional $1,000 in adjusted gross income.5
    See Maryland CDCTC information page for details.

Eligibility Requirements: See Maryland CDCTC information page.

Notes: Income limits for tax credit vary depending on filing status. The above numbers are for a married couple filing jointly. Individual filers use a similar schedule with income levels reduced by 50 percent.

Maryland Tax Credits In The News

18

Sep 17

News Round-Up: September 18, 2017

U.S. Senator Sherrod Brown (D-OH) and Representative Ro Khanna (D-CA) introduced the Grow American Incomes Now (GAIN) Act in the House and Senate, which would double the Earned Income Tax Credit (EITC) for eligible workers, increase the credit for workers without dependent children and lower the qualifying age.
Read More

5

Jan 17

The Year of the EITC? Several States Already Considering Tax Credit Legislation

States considered more than 170 bills related to the Earned Income Tax Credit (EITC) during 2016 legislative sessions, and just five days into 2017, this year looks like it will see at least as much activity to expand or reduce the credit.
Read More
1 2 3 6
For More State Information:

Robin McKinney, Director
Maryland CASH Campaign
http://www.mdcash.org
(443) 692-9422
robin@mdcash.org

Sources:
  1. Earned Income Tax Credit Information, Comptroller of Maryland
  2. House Bill 452, Maryland General Assembly
  3. House Bill 452 Fiscal and Policy Note, Maryland General Assembly
  4. Montgomery County Refundable Earned Income Credit, Montgomery County 311
  5. Child and Dependent Care Tax Credit Information, Comptroller of Maryland