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More Jobs for Marylanders Means More Tax Benefits

More Jobs for Marylanders Means More Tax Benefits

By: Michael Cirangle

During 2017, Maryland passed the “More Jobs for Marylanders Act” of 2017, which specifically seeks to incentivize manufacturers to make capital and workforce investments in Maryland. The Act is part of Governor Hogan’s effort to boost the growth of manufacturing in Maryland and was nearly unanimously passed by the legislature.

Benefits are available to both new and existing manufacturers with operations in Maryland. In order to receive tax credit incentives, new businesses entering the state need must make investments in what are called “Tier 1” counties. These counties include: Allegany, Baltimore, Caroline, Cecil, Dorchester, Garret, Kent, Prince George’s, Somerset, Washington, Wicomico, and Worcester, as well as Baltimore City.  Existing business are able to make investments in all Maryland counties, but have additional requirements for non-Tier 1 counties.

Tax Benefits for New Businesses:

  • Refundable State Income Tax Credits
  • Property Tax Credits
  • Sale and Use Tax Refunds
  • Waiver of Corporate Filings Fees

Tax Benefits for Existing Businesses:

  • Refundable State Income Tax Credits

To participate in the program, new and existing businesses must apply to the Maryland Department of Commerce, create at least five new qualified jobs in Tier 1 counties (existing business can create 10 new qualified jobs in non-Tier 1 counties), and have an on-going job training or post secondary education program (e.g. tuition reimbursement).

Expensing and Bonus Depreciation Changes

An often overlooked windfall from the legislation was the change in Maryland’s depreciation rules. In the past, Maryland has not followed the federal treatment for §179 expensing or bonus depreciation. However, under this new legislation, manufacturing entities (other than refiners) will be allowed to follow federal depreciation rules for Maryland purposes on property placed in service on or after January 1, 2019. This provision applies to all manufacturers whether or not they participate in the More Jobs for Marylanders program. This provision should stimulate capital expenditure spending within the state and give manufacturers even more reasons to expand their operations.

Ellin & Tucker stands ready to partner with our clients in this dynamic tax planning and compliance environment. If you would like to explore any of these incentives or know how they might impact your bottom line, please reach out to our tax professionals at taxtalk@ellinandtucker.com.

Michael Cirangle HeadshotMICHAEL G. CIRANGLE, CPA is a principal in the tax department of Ellin & Tucker and brings a wealth of national and international tax planning and compliance expertise spanning more than a decade. His extensive experience and inside knowledge of privately owned companies enables him to provide the highest level of practical and technical tax compliance and consultation. He can be reached at mcirangle@ellinandtucker.com.


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