Labor and Employment - Job Creation and Recovery Tax Credit

SB 106 (Chapter 1, Acts of 2010)

This Act establishes the Job Creation and Recovery Tax Credit to encourage qualified employers conducting or operating a trade or business in Maryland to hire qualified employees for newly-created or certain vacant positions in the State. The amount of the tax credit is based on the number of employees hired and the number of months that they were employed during the tax credit period. An individual, corporation or organization exempt under Section 501(c) of the Internal Revenue Code may claim the credit.

Qualified employees must be Maryland residents hired between March 25, 2010 and December 31, 2010 to fill positions that are full-time, for 12 months or more, located in the State, and newly created or have been vacant for at least six months. At the time of hire, the individuals must be receiving unemployment insurance benefits or have exhausted their benefits in the previous 12 months and not working full-time immediately preceding the date of hire.

A qualified employer must be certified by the Department of Labor, Licensing, and Regulation to claim up to a total credit of $5,000 per qualified employee multiplied by the number of qualified employees hired, but not to exceed $250,000. The credit amount for each qualified employee is $5,000 for a 12-month period or $416.67 for each month that the qualified employee was in the position. A qualified employer must claim the credit on the employer's tax return for each calendar month of 2010 as that month corresponds to the qualified employer's taxable year. If the credit allowed in a year exceeds the total tax otherwise payable by the qualified employer for the taxable year, the employer may claim a refund for the excess.

This Act became effective March 25, 2010.