ANNAPOLIS Small businesses in Maryland that provide paid sick and safe leave to their employees will soon be able to apply for a refundable tax credit administered by the Maryland Department of Commerce. The Small Business Relief Tax Credit offers businesses that meet certain criteria a state income tax credit of up to $500 per employee and $7,000 per small business for every year in which they qualify.
“Small businesses are the backbone of our economy and play a critical role in creating jobs, growing our economy, and strengthening our communities,” said Governor Larry Hogan. “Our administration remains committed to working in partnership with our business community, and this tax credit is one of many steps we are taking to ensure that Maryland remains open for business.”
The tax credit program was proposed and enacted by Governor Hogan to help businesses comply with the Maryland Healthy Working Families Act, which was passed by the Maryland General Assembly in early 2018 and requires businesses with 14 or fewer employees to provide unpaid sick and safe leave.
“Maryland’s small business community employs more than one million people, making it one of our most powerful and important economic assets,” said Maryland Commerce Secretary Mike Gill. “We encourage small businesses that are paying sick leave to consider applying for this credit, which will help them continue to be able to support their employees.”
Any type of small businesses, including nonprofits, may apply for the credit as long it has 14 or fewer employees. Businesses may apply every year for each employee making less than 250 percent of the annual federal poverty guidelines for a single-person household (currently $30,350 per year).
The Maryland Department of Commerce will begin accepting applications for the credit for tax year 2018 on January 3, 2019.
More information about eligibility requirements and how to apply can be found at: http://commerce.maryland.gov/fund/programs-for-businesses/small-business-relief-tax-credit.