§ 10-725. Biotechnology investment tax credit
West's Annotated Code of MarylandTax-GeneralEffective: July 1, 2022
Effective: July 1, 2022
MD Code, Tax - General, § 10-725
§ 10-725. Biotechnology investment tax credit
(2) “Biotechnology company” means a company organized for profit that is primarily engaged in, or within 2 months will be primarily engaged in, the research, development, or commercialization of innovative and proprietary technology that comprises, interacts with, or analyzes biological material including biomolecules (DNA, RNA, or protein), cells, tissues, or organs.
(5)(i) “Investment” means the contribution of money in cash or cash equivalents expressed in United States dollars, at a risk of loss, to a qualified Maryland biotechnology company in exchange for stock, a partnership or membership interest, or other ownership interest in the equity of the qualified Maryland biotechnology company, title to which ownership interest shall vest in the qualified investor.
(b)(1) The Biotechnology Investment Incentive Tax Credit is intended to foster the growth of Maryland's biotechnology industry by incentivizing investment in early stage companies with the goal of increasing the number of companies developing biotechnologies in Maryland, increasing overall investments in the biotechnology sector, and increasing the number of individual investors actively investing in Maryland's life sciences companies.
(2) Subject to paragraphs (3) and (4) of this subsection and subsections (d) and (e) of this section, for the taxable year in which an investment in a qualified Maryland biotechnology company is made, a qualified investor may claim a credit against the State income tax in an amount equal to the amount of tax credit stated in the final credit certificate approved by the Secretary for the investment as provided under this section.
(c)(1) At least 30 days prior to making an investment in a qualified Maryland biotechnology company for which a qualified investor would be eligible for an initial tax credit certificate under subsection (b) of this section, the qualified investor shall submit an application to the Department.
2. the credit amount allocated to the rescinded certificate shall revert to the Maryland Biotechnology Investment Tax Credit Reserve Fund and shall be available in the applicable fiscal year for allocation by the Department to other initial tax credit certificates in accordance with the provisions of this section.
(d)(1) The tax credit allowed in an initial tax credit certificate issued under this section is:
(2) During any fiscal year, the Secretary may not certify eligibility for tax credits for investments in a single qualified Maryland biotechnology company that in the aggregate exceed 10% of the total appropriations to the Maryland Biotechnology Investment Tax Credit Reserve Fund for that fiscal year.
(e)(1) In this subsection, “Reserve Fund” means the Maryland Biotechnology Investment Tax Credit Reserve Fund established under paragraph (2) of this subsection.
(iii) 1. Except as otherwise provided in this subparagraph, for any fiscal year, the Secretary may not issue initial tax credit certificates for credit amounts in the aggregate totaling more than the amount appropriated to the Reserve Fund for that fiscal year in the State budget as approved by the General Assembly.
2. If the aggregate credit amounts under initial tax credit certificates issued in a fiscal year total less than the amount appropriated to the Reserve Fund for that fiscal year, any excess amount shall remain in the Reserve Fund and may be issued under initial tax credit certificates for the next fiscal year.
3. For any fiscal year, if funds are transferred from the Reserve Fund under the authority of any provision of law other than under paragraph (4) of this subsection, the maximum credit amounts in the aggregate for which the Secretary may issue initial tax credit certificates shall be reduced by the amount transferred.
(f)(1) The credit claimed under this section shall be recaptured as provided in paragraph (2) of this subsection if within 2 years from the close of the taxable year for which the credit is claimed:
(g)(1) The Department may revoke its initial or final certification of an approved credit under this section if any representation in connection with the application for the certification is determined by the Department to have been false when made.
(h) In accordance with § 2.5-109 of the Economic Development Article, the Department shall report on the initial tax credit certificates awarded for the calendar year and the qualified Maryland biotechnology companies that received an investment for which an initial tax credit certificate was awarded.
(i) The Department and the Comptroller jointly shall adopt regulations to carry out the provisions of this section and to specify criteria and procedures for application for, approval of, and monitoring continuing eligibility for the tax credit under this section.
(j) If a company receives an investment under subsection (a)(7)(ii) of this section and fails to satisfy the requirements for a qualified Maryland biotechnology company within 2 months, the Department shall revoke any final tax credit certificates that have been issued and recapture any tax credits already claimed by the qualified investor.
Credits
Added by Acts 2005, c. 99, § 1, eff. July 1, 2005. Amended by Acts 2008, c. 518, § 1, eff. July 1, 2008; Acts 2009, c. 605, § 1, eff. July 1, 2009; Acts 2009, c. 606, § 1, eff. July 1, 2009; Acts 2011, c. 349, § 1, eff. June 1, 2011; Acts 2013, c. 75, § 1, eff. June 1, 2013; Acts 2013, c. 76, § 1, eff. June 1, 2013; Acts 2014, c. 45, § 1, eff. April 8, 2014; Acts 2015, c. 22, § 5; Acts 2015, c. 58, § 1, eff. June 1, 2015; Acts 2016, c. 8, § 5; Acts 2016, c. 503, § 1, eff. June 1, 2016; Acts 2017, c. 475, § 1, eff. June 1, 2017; Acts 2017, c. 476, § 1, eff. June 1, 2017; Acts 2021, c. 112, § 1, eff. June 1, 2021; Acts 2021, c. 206, § 2, eff. July 1, 2021; Acts 2021, c. 207, § 2, eff. July 1, 2021; Acts 2022, c. 116, § 1, eff. July 1, 2022.
MD Code, Tax - General, § 10-725, MD TAX GENERAL § 10-725
Current through legislation effective through May 9, 2024, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
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