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HB 149

Income Tax - Subtraction Modification - Child Support Payments

2025 Regular Session Introduced by Caylin Young

Would have let Maryland residents subtract court-ordered child support payments from Maryland taxable income, cutting state/local taxes; effective 7/1/2025; withdrawn in 2025.

Withdrawn by Sponsor
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WeVote Research Nonpartisan
Bill Summary · HB 149

Summary — HB 149: Income Tax — Subtraction Modification — Child Support Payments

Status: Withdrawn by sponsor (withdrawn 2025-03-12)
Introduced: January 8, 2025 (first reader); bill would have taken effect July 1, 2025 and applied to tax year 2025 and after if enacted.

Purpose / Intent

The bill would have allowed Maryland resident taxpayers to subtract court‑ordered child support payments they made during the tax year from their Maryland taxable income. The stated policy effect is to reduce state and local income tax liabilities for individuals who pay court‑ordered child support.

Key provisions

  • Adds a new personal income tax subtraction to Tax‑General §10‑208 for the amount of any child support payments made by an individual during the taxable year that:
    • were paid to another person on behalf of the individual’s child, and
    • were required by a court order issued by any state.
  • Effective date provision: the law would take effect July 1, 2025 and apply to tax year 2025 and later.
  • The bill does not change federal tax treatment (under current federal law, child support is not deductible by the payor and not taxable to the recipient).

Who would be affected

  • Directly affected: Maryland resident taxpayers who make court‑ordered child support payments — these payors could reduce their Maryland taxable income by the amount of such payments.
  • Indirectly affected: State and local governments — expected reductions in state general fund and local income tax revenues.
  • Child support recipients: the bill does not make child support taxable to recipients; it only provides a subtraction for payors.

Fiscal impact (as estimated by Maryland Department of Legislative Services)

  • General fund (state) revenue: would decrease significantly, preliminarily estimated potentially in excess of $20.0 million annually beginning in FY 2026.
  • Local income tax revenue: would decrease significantly, preliminarily estimated potentially in excess of $13.0 million annually beginning in FY 2026.
  • Expenditures: DLS estimated no direct change in State or local expenditures; administrative implementation (tax form/IT updates) was not expected to materially change costs according to the note.
  • Estimates are preliminary and indeterminate in precision due to data limitations; the DLS analysis referenced U.S. Census Current Population Survey child support data to derive the preliminary loss ranges.

Procedural / timeline notes

  • Introduced in the House (Delegate Young); referred to Ways & Means.
  • Fiscal and policy analyses were prepared (DLS fiscal note dated January 27, 2025).
  • The sponsor withdrew the bill on March 12, 2025; as withdrawn it did not become law. If reenacted, the effective date language in the draft would make the subtraction applicable beginning in tax year 2025.

If you want, I can:
- Draft a short one‑page explainer for taxpayers (how a subtraction would be claimed and documentation likely needed), or
- Prepare a fiscal sensitivity table showing how different take‑up rates among payors would change the revenue estimate.

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

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