Maryland's Lower Eastern Shore--A Great Place to Do Business!

Business Environment

Corporate Income Tax

Maryland's corporate income tax has held steady at 7% for years. A recent study found that the tax burden on business as a percentage of total tax revenue is lower in Maryland than any other state.

Corporate Income Tax Credits
Companies receive income tax credits for wages paid to qualified employees in enterprise zones. A three-year $3,000 credit is allowed for new, disadvantaged employees; a one-time $500 credit is allowed for all other new employees. The three-year income tax credit amounts to $1,500 in the first year, $1,000 in the second year, and $500 in the third year. Income tax credits can be carried forward up to five years.

Employment Opportunity Credit: Employers can earn up to $5,100 in Maryland State tax credits by hiring eligible workers at any location. The following credits apply:

Additional tax credits are available if you help with a worker's child care expenses. There is no limit to the number of EOC eligible employees you may hire. Eligible workers are Maryland residents who for at least six (6) months were recipients of benefits through the Aid to Families with Dependent Children (AFDC) program.

Job Creation Tax Credit: Certain companies creating at least 60 new jobs over a 24-month period and paying at least 150% of the federal minimum wage are eligible to receive a $1,000 state corporate income tax credit for each employee hired. In an enterprise zone, the credit increases to $1,500.

A company may receive the enterprise zone tax credit, the EOC tax credit and the job creation tax credit for each eligible person hired.

Sources: (Text) Maryland: A Business Inventory of Major Locational Factors (Maryland Department of Business & Economic Development)

Maryland's Lower Eastern Shore Business Environment