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HB 614

Local Earned Income Tax Credit - Calculation - County Income Tax Rate

2025 Regular Session

HB 614 ties Maryland's local earned income tax credit to each county's individual income tax rate, allowing credits to vary by county and adjust automatically with tax rate changes.

Approved by the Governor - Chapter 629
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WeVote Research Nonpartisan
Bill Summary · HB 614

Legislative bill overview

HB 614 modifies Maryland's local earned income tax credit calculation by tying it to each county's income tax rate rather than a fixed state rate. This allows the credit to vary by county based on local tax burdens. The bill became law in May 2025 after passing through the legislature with favorable committee reports.

Why is this important

This change affects how working families in different Maryland counties receive tax relief, potentially making the credit more equitable across counties with varying tax rates. It also creates a more dynamic system where credits automatically adjust if counties modify their income tax rates, without requiring new legislation each time.

Potential points of contention

  • Equity concerns: Counties with higher income tax rates would receive proportionally larger credits, potentially creating disparities in actual tax relief between counties
  • Administrative complexity: Tying credits to variable county rates requires more sophisticated tax administration and ongoing adjustments
  • Revenue impact uncertainty: The variable structure makes it harder to predict state revenue loss, complicating budget planning

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

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