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HB 323

Income Tax - Credit for Income Taxes and Penalties Due to Financial Exploitation

2026 Regular Session Introduced by Vaughn Stewart

HB 323 creates Maryland income tax credits for residents who incurred taxes/penalties due to financial exploitation, offering relief to fraud and scam victims.

Withdrawn by Sponsor
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WeVote Research Nonpartisan
Bill Summary · HB 323

Legislative bill overview

HB 323 would create an income tax credit for Maryland residents who have paid income taxes or penalties as a direct result of financial exploitation (such as fraud, scams, or coercion by another person). The credit would allow victims to recover some of their financial losses through the tax system, providing relief when they've been forced or tricked into tax liability they wouldn't otherwise owe.

Why is this important

Financial exploitation of vulnerable populations—particularly elderly and disabled individuals—causes significant economic harm. This bill recognizes that victims may face both direct losses to scammers and additional tax burdens, offering a targeted relief mechanism. The credit could reduce financial hardship for exploitation victims and acknowledge government responsibility in providing restitution pathways.

Potential points of contention

  • Verification challenges: Determining what constitutes "financial exploitation" and proving causation between exploitation and tax liability may be administratively complex and prone to abuse or inconsistent application.
  • Fiscal impact: The bill's revenue cost is unknown; depending on eligibility scope and uptake, it could represent significant foregone state tax revenue without clear budgetary offsets.
  • Scope and limits: The bill doesn't specify income limits, exploitation types covered, or maximum credit amounts, raising questions about whether relief would be adequate or potentially excessive for high-income victims.

Compiled from official sources — confirm details with the bill’s official record.

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