Maryland State & County Tax Credit Ruling – Wynne V. Comptroller Update

Posting by Glenn Bailey

The U.S. Supreme Court has agreed to hear the case of Md. Comptroller of Treasury v. Wynne, (U.S., No. 13-485, cert. granted, 5/27/14) on whether a taxpayer’s resident municipality can tax all of a resident’s income or if it must provide a credit for taxes that person paid to other states. This case specifically addresses Maryland’s denial of credits against the MD county income tax; full details are available in our previous post on this case.

This challenge here is based on the Commerce clause of the U.S. Constitution and was originally decided in favor of the taxpayer in 2011, allowing taxes paid to another state to count as a tax credit against the income taxes paid to a Maryland County. Maryland had appealed the case and lost in the Maryland Court of Appeals and is appealing again.

We have advised anyone who might be affected by the ability to take a credit against the local tax to file a protective claim to protect their right to a refund if the case is finalized in the taxpayer’s favor. Hopefully a final decision will be handed down in the next year. Stay tuned to our blog for further updates on this case.


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