Maryland2026Active
HB0005
Maryland New Markets Development Program
Last scannedAug 22, 2026, 4:24 AM
In one sentence
This law creates a program that gives tax credits to investors who put money into businesses located in low-income communities.
What it does
- Creates the Maryland New Markets Development Program and assigns it to the Department of Housing and Community Development.
- Allows investors to claim a credit against state insurance premium receipts taxes, retaliatory taxes, fees, charges, or penalties for buying shares in qualified community development entities.
- Sets the total amount of credits available at $18,750,000 per year.
- Requires that 100% of investment cash be used by these entities to fund businesses in low-income areas.
- Allows investors to use unused tax credits for up to six years after making an investment.
Who it affects
- Investors who pay state insurance premium receipts taxes or retaliatory taxes, fees, charges, and penalties.
- Businesses that operate primarily in Maryland and serve low-income communities.
- Community development entities that manage investments into these businesses.
- The Department of Housing and Community Development, which runs the program.
Limits and unknowns
- The total amount of tax credits issued cannot exceed $18,750,000 in any single taxable year.
- Investors receive no credit value for the first three years and only a partial credit (12.5%) starting in the fourth year.
- The Department can take back or recapture a tax credit if certain rules are not followed.
Plain language
Terms to know
- Qualified Equity Investment
- Money paid in cash to buy shares in a community development entity that meets specific state rules.
- Community Development Entity
- A business organization that receives investment money and puts it into low-income communities.
- Principal Business Operations
- The location where at least 60% of a company's employees work or earn their paychecks.
Official record
Sources
Official summary
Establishing the Maryland New Markets Development Program; requiring the Department of Housing and Community Development to administer the Program; authorizing a credit against the State insurance premium receipts tax and certain State insurance retaliatory taxes, fees, charges, and penalties for certain equity investments in certain community development entities; authorizing the Department to recapture a credit under certain circumstances; limiting the credit amounts that may be issued to $18,750,000 for any taxable year; etc.
Official activity
Bill history
- In the House - Hearing 2/12 at 1:00 p.m. (Economic Matters) and Hearing canceled (Ways and Means)