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HB1035 • 2026

Income Tax - Subtraction Modification - Overtime Compensation

Income Tax - Subtraction Modification - Overtime Compensation

Taxes
Passed Legislature

This bill passed both chambers and reached final enrollment, even if later executive action is not shown here.

Sponsor
Delegates Fisher , Arikan , Chisholm , Grammer , M. Morgan , Nawrocki , and Szeliga
Last action
2026-02-10
Official status
In the House - Hearing 2/26 at 1:00 p.m.
Effective date
2026-07-01

Plain English Breakdown

Using official source text because the generated explanation was unavailable or could not be confirmed against the official bill text.

Income Tax - Subtraction Modification - Overtime Compensation

Allowing a subtraction modification under the Maryland income tax for certain overtime compensation; and applying the Act to taxable years beginning after December 31, 2025, but before January 1, 2029.

What This Bill Does

  • Allowing a subtraction modification under the Maryland income tax for certain overtime compensation; and applying the Act to taxable years beginning after December 31, 2025, but before January 1, 2029.

Limits and Unknowns

  • This entry is temporarily using official source text because the generated explanation could not be confirmed against the official bill text during the last sync.

Bill History

  1. 2026-02-10 House

    Hearing 2/26 at 1:00 p.m.

  2. 2026-02-09 House

    First Reading Ways and Means

  3. Maryland General Assembly

    Text - First - Income Tax - Subtraction Modification - Overtime Compensation

Official Summary Text

Allowing a subtraction modification under the Maryland income tax for certain overtime compensation; and applying the Act to taxable years beginning after December 31, 2025, but before January 1, 2029.

Current Bill Text

Read the full stored bill text 
EXPLANATION: CAPITALS INDICATE MATTER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*hb1035*

HOUSE BILL 1035
Q3 6lr2839

By: Delegates Fisher, Arikan, Chisholm, Grammer, M. Morgan, Nawrocki, and
Szeliga
Introduced and read first time: February 9, 2026
Assigned to: Ways and Means

A BILL ENTITLED

AN ACT concerning 1

Income Tax – Subtraction Modification – Overtime Compensation 2

FOR the purpose of allowing a subtraction modification under the Maryland income tax for 3
certain overtime compensation; and generally relating to a subtraction modification 4
under the Maryland income tax for overtime compensation. 5

BY repealing and reenacting, without amendments, 6
Article – Tax – General 7
Section 10–208(a) 8
Annotated Code of Maryland 9
(2022 Replacement Volume and 2025 Supplement) 10

BY adding to 11
Article – Tax – General 12
Section 10–208(dd) 13
Annotated Code of Maryland 14
(2022 Replacement Volume and 2025 Supplement) 15

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
That the Laws of Maryland read as follows: 17

Article – Tax – General 18

10–208. 19

(a) In addition to the modification under § 10 –207 of this subtitle, the amounts 20
under this section are subtracted from the federal adjusted gross income o f a resident to 21
determine Maryland adjusted gross income. 22

2 HOUSE BILL 1035

(DD) (1) IN THIS SUBSECTION , “QUALIFIED OVERTIME CO MPENSATION” 1
HAS THE MEANING STATED IN § 225 OF THE INTERNAL REVENUE CODE. 2

(2) THE SUBTRACTION UNDER SU BSECTION (A) OF THIS SECTION 3
INCLUDES THE AMOUNT OF QUALIFIED OVERTIME COMPENSATION ALLOWED AS A 4
DEDUCTION UNDER § 225 OF THE INTERNAL REVENUE CODE. 5

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 6
1, 2026, and shall be applicable to all taxable years beginning after December 31, 2025, but 7
before January 1, 2029 . It shall remain effective for a period of 3 years and, at the end of 8
June 30, 2029, this Act, with no further action required by the General Assembly, shall be 9
abrogated and of no further force and effect. 10