Maryland has been illegally double-taxing residents who pay income tax to other states
A divided Supreme Court said Monday that Marylands income tax law is unconstitutional because it does not provide a full tax credit to residents for money earned outside the state, a ruling likely to cost Maryland counties and localities across the country millions of dollars in revenue.
The court voted 5-4 to affirm a 2013 Maryland Court of Appeals decision that the states practice of withholding a credit on the county segment of the state income tax violated the Commerce Clause, because it might discourage individuals from doing business across state lines.
Maryland residents are permitted to deduct income taxes paid to other states from what they pay in Maryland state income tax. But the state did not allow the same deduction to be applied to a "piggy back" tax that is collected by the state for counties and some cities.
The ruling means that Maryland taxpayers who tried to claim the credit on their county income tax returns between 2006 and 2014 are likely to be eligible for refunds, which the state Comptrollers office says could total $200 million with interest.
Read the rest at: http://www.washingtonpost.com/local/md-politics/supreme-court-rules-maryland-income-tax-law-is-unconstitutional/2015/05/18/1e92ee7a-d16f-11e4-ab77-9646eea6a4c7_story.html