The MACPA was joined by the Maryland Chamber of Commerce in testifying at a Maryland General Assembly hearing Tuesday in favor of House Bill 484, which would align the Maryland corporate income tax return due date with the new federal due date effective for tax year 2016 returns. The hearing was before the House Ways and Means Committee.
(Pictured from left: Front row — Del. Jay Walker and Joseph Flack, CPA testifying on behalf of the MACPA; second row — PJ Hogan of the Maryland Chamber of Commerce; back row — Marybeth Halpern, manager of advocacy and technical services for the MACPA).
As revised by the IRS and effective with 2016 tax year returns, corporations filing C-corporation returns will have an extra month to file those returns, moving from the 15th day of the third month of the fiscal year (March 15 for calendar-year companies) to the 15th day of the fourth month of the fiscal year (April 15 for calendar-year companies).
Del. Jay Walker, the sponsor of HB 484, noted in introducing the bill and his panel that “House Bill 484 will get us in line with the federal government; the federal government moved back the date for corporations. … We know in this committee what happens when states don’t align with the federal government in regards to taxes.”
Walker then introduced Joseph Flack, CPA, a partner in Biegel & Waller’s Tax Services Practice and a member of the MACPA’s State and Local Tax Committee.
“Right now,” said Flack, testifying on behalf of the MACPA, “March 15 is the due date for C-corp returns for Maryland and federal (returns). Starting in (tax year) 2016, returns due next year, the federal return due date will be April 15, so we need the Maryland due date to align with the federal.”
Flack emphasized, “The state return, line 1, says, ‘Write down your federal taxable income number before adjustments,’ so we need the federal return done” in order to complete the information for the state return.
The state return for C corporations would only be moving by one month, Flack reiterated. He added there would be no change in the due dates for estimated taxes.
“We request the bill be favorably approved with amendment to make sure it is effective for (tax year) 2016,” said Flack.
A letter from MACPA Executive Director Tom Hood was submitted for the record, expressing strong support for the bill on behalf of the MACPA’s more than 9,000 members. Regarding an amendment to the bill suggested by the MACPA and referenced in Flack’s testimony at the Ways and Means hearing, Hood noted in his letter:
We support amending “applicable to all taxable years beginning after December 31, 2016” to “applicable to all taxable years beginning after December 31, 2015.” This will ensure Maryland is aligned with the federal implementation date. It will apply to 2016 tax returns prepared during the 2017 tax filing season.
Following Flack’s testimony, PJ Hogan of Cornerstone Government Affairs testified on behalf of the Maryland Chamber of Commerce.
“On behalf of the Maryland Chamber of Commerce, we support this bill,” Hogan told the House Ways and Means Committee.
Senate Bill 288 parallels House Bill 484 on aligning the due date of the Maryland and federal C-corporation returns. MACPA State and Local Tax Committee Chair Jerry Beard testified on behalf the MACPA in support of SB 288 (with the amendment discussed above, regarding effective date) in a Senate Budget and Tax Committee hearing last week.
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