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EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb0656*
HOUSE BILL 656
Q3, Q4, Q1 6lr1593
HB 1192/25 – W&M
By: Delegates R. Long, Anderson, Arentz, Baker, Chisholm, Ciliberti, Griffith,
Hornberger, Tomlinson, and Valentine
Introduced and read first time: January 30, 2026
Assigned to: Ways and Means
A BILL ENTITLED
AN ACT concerning 1
Income, Sales and Use, and Property Taxes – Revocation of Exempt Status for 2
Nonprofit Organizations for Supporting Terrorist Organizations 3
FOR the purpose of requiring, as practicable, the Comptroller and the Director of the State 4
Department of Assessments and Taxation to jointly determine on a regular basis 5
whether a certain nonprofit organization in the State has been found to be a certain 6
terrorist–supporting organization; requiring that the Comptroller and the Director 7
revoke a terrorist –supporting organization’s tax –exempt status with respect to 8
certain Maryland income tax, sales and use tax, and property tax exemptions; 9
establishing procedures for the revocation and reinstatement of a nonprofit 10
organization’s tax –exempt status under this Act; and generally relating to the 11
tax–exempt status of nonprofit organizations who support terrorist organizations. 12
BY adding to 13
Article – Tax – General 14
Section 2–121 15
Annotated Code of Maryland 16
(2022 Replacement Volume and 2025 Supplement) 17
BY adding to 18
Article – Tax – Property 19
Section 7–111 20
Annotated Code of Maryland 21
(2019 Replacement Volume and 2025 Supplement) 22
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 23
That the Laws of Maryland read as follows: 24
Article – Tax – General 25
2 HOUSE BILL 656
2–121. 1
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 2
INDICATED. 3
(2) “DIRECTOR” MEANS THE DIRECTOR OF THE STATE DEPARTMENT 4
OF ASSESSMENTS AND TAXATION. 5
(3) “MATERIAL SUPPORT OR R ESOURCES” HAS THE MEANING 6
STATED IN 18 U.S.C. § 2339A. 7
(4) “NONPROFIT ORGANIZATION” MEANS A BUSINESS ENTITY THAT: 8
(I) IS EXEMPT FROM FEDERAL INCOME TAXES UNDER § 501 OF 9
THE INTERNAL REVENUE CODE; AND 10
(II) HAS BEEN GRANTED: 11
1. AN INCOME TAX EXEMPTION UNDER § 10–104 OF THIS 12
ARTICLE; 13
2. A SALES AND USE TAX EXEMPTION UNDER § 11–204 OF 14
THIS ARTICLE; OR 15
3. A PROPERTY TAX EXEMP TION UNDER § 7–202 OR § 16
7–204 OF THE TAX – PROPERTY ARTICLE. 17
(5) “TERRORIST–SUPPORTING ORGANIZATION” MEANS A NONPROFIT 18
ORGANIZATION OR AN A GENT OF THE NONPROFI T ORGANIZATION THAT HAS BEEN 19
FOUND BY A FEDERAL A GENCY TO BE IN VIOLA TION OF 18 U.S.C. § 2339A OR § 20
2339B FOR PROVIDING MATERIAL SUPPORT OR RESOURCES TO AN ORGANIZATION 21
DESIGNATED AS A TERR ORIST ORGANIZATION BY THE U.S. SECRETARY OF STATE 22
OR UNDER § 501(P) OF THE INTERNAL REVENUE CODE. 23
(B) THE COMPTROLLER AND THE DIRECTOR SHALL JOINTLY, AS 24
PRACTICABLE, DETERMINE ON A REGUL AR BASIS WHETHER ANY NONPROFI T 25
ORGANIZATION IN THE STATE HAS BEEN FOUND TO BE A TERRORIST–SUPPORTING 26
ORGANIZATION. 27
(C) SUBJECT TO SUBSECTIONS (D) THROUGH (F) OF THIS SECTION, IF THE 28
COMPTROLLER AND THE DIRECTOR DETERMINE TH AT A NONPROFIT 29
ORGANIZATION IN THE STATE HAS BEEN FOUND TO BE A TERRORIST–SUPPORTING 30
ORGANIZATION IN ANY OF THE 3 IMMEDIATELY PRECEDING TAXABLE YEARS , THE 31
HOUSE BILL 656 3
COMPTROLLER SHALL REVOKE THE NONPROFIT ORGANI ZATION’S TAX –EXEMPT 1
STATUS WITH RESPECT TO THE INCOME TAX AN D SALES AND USE TAX IMPOSED 2
UNDER THIS ARTICLE. 3
(D) (1) BEFORE REVOKING A NONPROFIT ORGA NIZATION’S 4
TAX–EXEMPT STATUS UNDER THIS SECTION , THE COMPTROLLER SHALL SEN D 5
NOTICE OF THE REVOCATION BY REGISTERED MAIL TO: 6
(I) THE NONPROFIT ORGANI ZATION’S ADDRESS OF 7
REGISTRATION IN THE STATE; AND 8
(II) IF APPLICABLE , THE ADDRESS ON THE M OST RECENTLY 9
FILED INCOME TAX RETURN FOR THE NONPROFIT ORGANIZATION. 10
(2) THE NOTICE REQUIRED U NDER THIS SECTION SH ALL INCLUDE 11
ANY INFORMATION ON W HICH THE COMPTROLLER RELIED WH EN DECIDING TO 12
REVOKE THE NONPROFIT ORGANIZATION’S TAX–EXEMPT STATUS. 13
(E) (1) A NONPROFIT ORGANIZATI ON THAT RECEIVES A N OTICE OF 14
REVOCATION UNDER SUBSECTION (D) OF THIS SECTION SHALL HAVE 90 CALENDAR 15
DAYS FROM THE DATE THE LAST NOTICE IS MAILED TO PROVIDE ANY INFORMATION 16
AS MAY BE REQUIRED BY THE COMPTROLLER TO PREVENT THE REVOCATION. 17
(2) THE COMPTROLLER MAY WITHD RAW THE DECISION TO REVOKE 18
BASED ON THE INFORMATION PROVIDED BY THE NONPROFIT ORGANIZATION UNDER 19
PARAGRAPH (1) OF THIS SUBSECTION. 20
(F) (1) AFTER THE 90 DAYS UNDER SUBSECTION (E)(1) OF THIS SECTION 21
LAPSE, THE REVOCATION SHALL BECOME EFFECTIVE UNLESS THE COMPTROLLER 22
WITHDRAWS THE DECISION TO REVOKE IN ACCORDANCE WITH S UBSECTION (E)(2) 23
OF THIS SECTION. 24
(2) THE COMPTROLLER SHALL PRO MPTLY NOTIF Y THE DIRECTOR 25
WHEN ANY REVOCATION AUTHORIZED UNDER THIS SECTION BECOMES EFFECTIVE. 26
(3) THE COMPTROLLER MAY REINS TATE A NONPROFIT 27
ORGANIZATION’S TAX –EXEMPT STATUS THAT H AS BEEN REVOKED UNDER THIS 28
SECTION ONLY IF: 29
(I) THE COMPTROLLER DETERMINE S THE REVOCATION WAS 30
ERRONEOUS; 31
4 HOUSE BILL 656
(II) THE COMPTROLLER RECEIVES ATTESTATION FROM THE 1
NONPROFIT ORGANIZATI ON UNDER PENALTY OF PERJURY THAT IT DID NOT 2
RECEIVE THE NOTICE REQUIRED UNDER SUBSECTION (D) OF THIS SECTION; OR 3
(III) BASED ON ANY OTHER N EWLY AVAILABL E INFORMATION 4
AND IN ACCORDANCE WI TH PROCEDURES ADOPTE D BY THE COMPTROLLER, THE 5
COMPTROLLER DETERMINES THE TAX–EXEMPT STATUS SHOULD BE REINSTATED. 6
(G) A NONPROFIT ORGANIZATI ON THAT HAS ITS TAX –EXEMPT STATUS 7
REVOKED UNDER THIS SECTION MAY APPEAL THE REVOCATION TO THE MARYLAND 8
TAX COURT. 9
(H) THE COMPTROLLER AND THE DIRECTOR SHALL JOINTL Y ADOPT 10
REGULATIONS TO CARRY OUT THIS SECTION. 11
Article – Tax – Property 12
7–111. 13
(A) IN THIS SECTION , “NONPROFIT ORGANIZATI ON” HAS THE MEANING 14
STATED IN § 2–121 OF THE TAX – GENERAL ARTICLE. 15
(B) IF THE DIRECTOR RECEIVES NOT ICE THAT THE COMPTROLLER HAS 16
REVOKED A NONPROFIT ORGAN IZATION’S TAX –EXEMPT STATUS IN ACC ORDANCE 17
WITH § 2–121 OF THE TAX – GENERAL ARTICLE, THE DIRECTOR SHALL REVOKE THE 18
NONPROFIT ORGANIZATI ON’S TAX –EXEMPT STATUS WITH R ESPECT TO ANY 19
PROPERTY TAX EXEMPTION UNDER § 7–202 OR § 7–204 OF THIS TITLE. 20
(C) THE DIRECTOR SHALL FOLLOW THE PROCEDURES SPECIFIED UNDER § 21
2–121 OF THE TAX – GENERAL ARTICLE FOR IMPOSING AND WITHDRAWING A 22
REVOCATION AND REINST ATING A NONPROFIT OR GANIZATION’S TAX –EXEMPT 23
STATUS UNDER THIS SECTION. 24
(D) A NONPROFIT ORGANIZATI ON THAT HAS ITS TAX –EXEMPT STATUS 25
REVOKED UNDER THIS SECTION MAY APPEAL THE REVOCATION TO THE MARYLAND 26
TAX COURT. 27
(E) THE DIRECTOR AND THE COMPTROLLER SHALL JOINTLY ADOPT 28
REGULATIONS TO CARRY OUT THIS SECTION. 29
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect June 30
1, 2026. 31