Franchot Blog

ANNAPOLIS, Md. (April 11, 2013) – Back for a second year, Comptroller Peter Franchot today announced his office is accepting nominations for the William Donald Schaefer Helping People Award. The Comptroller created the award, to recognize individuals and organizations in each county and Baltimore City best exemplifying Schaefer’s lifelong commitment to helping people.

Winners will be selected based on their demonstration of improving the community, swiftly solving a citizen problem through effective government intervention, directly aiding the most vulnerable in society or creating a public/private partnership to improve the lives of Marylanders.

“We received many nominations during the inaugural season so picking just one winner in each jurisdiction proved difficult. There are countless deserving organizations and individuals, who embody Schaefer’s lifelong drive to help people. It just made sense to accept nominations for a second year,” said Comptroller Franchot.

The Comptroller will personally present the award to each winner starting in May.
The nomination form, additional information and a list of past winners can be found on the Comptroller’s website, by clicking here. All nominations must be received by May 10, 2013.

MEDIA CONTACT: Christine Feldmann, 410-260-6346 (office)

ANNAPOLIS, Md. (March 7, 2013) -- The Board of Revenue Estimates met today to write down revenue estimates for Fiscal Years 2013 and 2014 by $115.3 million. Comptroller Peter Franchot, as chairman of the Board, released the following statement.

“As always, I’d like to begin by thanking Andy Schaufele for his outstanding work in preparing this report, and for his seamless transition leading this effort.

I’d also like to take a minute to thank the rest of our outstanding Board of Revenue Estimates’ staff, along with the Revenue Monitoring Committee, for their tireless efforts that go into producing these estimates.

Mr. Schaufele and his team’s fine work is empirical confirmation of the reality that most Maryland families and small businesses are experiencing. We continue to grapple with the most anemic economic recovery in generations and confusing singular snippets of positive news out of context fails to appreciate the larger economic picture.

For starters, the expiration of the payroll tax holiday has delivered quite a noticeable blow to workers' paychecks and coupled with escalating gas prices that have reached $4 a gallon in parts of our state, the working families and small businesses struggling most through these precarious economic times continue to be disproportionately affected.

This revenue write down of $115.3 million assumes that despite Congress’ inability to reach a deal by the March 1 deadline, the draconian cuts associated with sequestration will ultimately be averted and replaced by smaller, alternative cuts that will spare Maryland from the potential economic disaster that would otherwise ensue.

The assumption that Maryland will lose 12,600 jobs pales in comparison to the 65,000 jobs, on the low end, and as many as 120,000 jobs that experts project Maryland could lose if no compromise is reached.

With total federal spending in the state equivalent to one-third of the Maryland economy, we are heavily reliant upon Washington’s direct, indirect and induced economic benefits. Consequently, the Board of Revenue Estimates continues to closely monitoring what happens in Washington.

While the gross numbers are important, the specifics within this report demonstrate a far more telling story. Far too many Marylanders are taking home less pay at a time when their living costs are rising, meaning they have less discretionary income to spend in an economy that’s primarily based on consumer behavior.

It’s particularly troubling that $85.5 million of the projected decline, the vast majority of it in fact, comes from our broadest and most indicative economic indicator, sales and use tax. Additionally, and just as troubling, nearly $77 million of the $115.3 million write down is for Fiscal Year 2013.

So, far less important than having $115 million less revenue than we expected to spend on our priorities, this means that the economic pain and suffering in the Maryland economy is being felt immediately and virtually across the board.

There’s just no way to gloss over how fragile the Maryland economy remains.

Our employment levels have yet to reach their pre-recession levels. We are ranked forty-sixth in the country in year-over-year private sector wage growth. We simply are not out of the woods from the lingering economic challenges and uncertainty following a recession whose magnitude and depth we haven’t experienced in our lifetimes.

Now, more than ever, we need to proceed with an exceedingly cautious mindset, and avoid policy decisions that would take money out of the pockets of consumers and make employers increasingly reluctant to invest capital in our state.

The bottom line is that we simply cannot afford to cause further uncertainty to a weakened Maryland economy.

In the long-term, I remain as optimistic as ever that Maryland’s economic bones are strong and resilient, from world-class education and research to an underlying entrepreneurial spirit that’s constantly resetting the limits of innovation.

But as is so evident in this report, Maryland’s economy is exceptionally fragile and we must remain exceedingly cautious.

While we share hope about our prospects for compromise in Washington that averts devastating consequences and for a lasting economic recovery that takes hold sooner rather than later, I remind my colleagues that hope is not an economic strategy.

I continue to be proud of our battle-tested leadership that has capably led this state through these years of economic and fiscal uncertainty.

I remain confident that Maryland’s story will have a happy ending. Until then, however, the difficult work endures and as Maryland’s chief fiscal stewards, we must continue to exercise tremendous caution and restraint.”

Annapolis, Md. (February 28, 2013) –Comptroller Peter Franchot hosted a press conference in support of legislation that would provide resources to ensure a School Resource Officers (SROs) in public schools throughout Maryland.

The provisions in HB 165 and SB 807 are in reaction to the tragedy in Newtown, Connecticut, last December, as well as an August 2012 shooting that occurred at Perry Hall High School. The bills would require each county superintendent to enter into an agreement with an appropriate law enforcement agency to provide a full-time school resource officer to each public elementary and secondary school; provide additional funding required for school resource officers to be paid from the Education Trust Fund. The companion legislation -- which would be an emergency measure -- has bipartisan co-sponsorship in both chambers.

“There's no good reason why every school in Maryland shouldn't have a trained, armed resource officer. We have no obligation more fundamental than keeping our kids safe from harm," Comptroller Franchot said. "We just can't afford to let politics get in the way of protecting our children."

"As we are still feeling the shock and horror of the terrible tragedy at Sandy Hook Elementary School in Connecticut, I felt it necessary to take action to improve the safety of our schools,” says Delegate Cluster. “Many Maryland jurisdictions already have SROs, but HB 165 and SB 807 would place an active police officer in every school.”

“As a father, I am focused on keeping our schools safe for our children,” he said. “By putting an armed officer in every school, Senate Bill 807 will assure the fastest response to a gun threat and have an immediate and positive impact on the children’s safety,” says Senator Pipkin.

The event attendees heard from a retired school principal, law enforcement officials and concerned parents on how the proposed bills will help keep our schools safe.
The hearing for both bills was held Thursday afternoon. For more information on HB 165 and SB 807 please visit http://mgaleg.maryland.gov/webmga/frmMain.aspx?pid=billpage&tab=subject3...

Annapolis, Md. (January 24, 2013)-The new year is here and just as consumers are getting used to writing 2013 on checks, it’s time to start thinking about tax season. Comptroller Peter Franchot shared some important information today to assist taxpayers in completing their personal income tax returns.

This year the Internal Revenue Service (IRS) has pushed back the start date for filing personal current-year tax returns to January 30, and Maryland is following suit. Neither paper nor electronic returns will be processed prior to that date. The filing deadline for 2012 tax returns is Monday, April 15.

“We have less than three months until the April 15 tax filing deadline and my agency is available to help any taxpayer with questions or problems,” said Comptroller Franchot. “I’m very proud of the work my staff does to help taxpayers year round, but especially during tax season. My agency makes filing state taxes as easy as possible by offering forms online and providing free help and e-filing at any of the 12 branch offices.”

There are a few changes and tips for filing 2012 returns:
Tax Booklets - Tax booklets, forms and instructions are available from the Comptroller’s Website at www.marylandtaxes.com. Taxpayers can find a limited supply of 2012 tax booklets at various libraries throughout the state, as well as at any of the Comptroller’s branch offices. Taxpayers may also request a tax booklet by calling (410) 260-7951 or by email to taxforms@comp.state.md.us .

Hours – Branch offices will be open from 8:30 a.m. to 4:30 p.m., Monday through Friday, including Presidents’ Day (February 18). Offices will also have extended hours on Saturday, April 13, from 9 a.m. to 1 p.m. and from 8 a.m. to 7 p.m. on April 15, to help taxpayers fill out and electronically file their tax forms for free.

Libraries and Post Offices – The Comptroller’s Office no longer supplies all local post offices with tax booklets. We have sent a limited supply of tax booklets to requesting libraries.

What is needed to file - Before taxpayers file a Maryland income tax return, they are required to complete a federal income tax return. Often the same documentation required to complete the federal income tax return is also required to complete the Maryland return. Additionally, supporting documentation for Maryland credits and modifications may be necessary for preparing the Maryland return. For more information on credits, modifications and necessary documentation please go to http://individuals.marylandtaxes.com/taxforms/12forms.asp .

Discarding old returns - Generally, taxpayers should keep tax records for at least three years from the date of filing a return or filing deadline, whichever is later.

New Income Tax Rates – The Maryland General Assembly has approved new income tax rates and rate brackets for individuals for all tax years beginning after December 31, 2011. See Instruction 17 in the resident tax booklet for the new tax rate schedules.

Local Tax Rate Changes - For tax year 2012, Anne Arundel County has decreased its local tax rate to 2.49% and Queen Anne's County has increased its local tax rate to 3.20%. For tax year 2013, Anne Arundel County has increased its local tax rate back to 2.56%; Talbot County has increased its rate to 2.40%; and Wicomico Count has increased its rate to 3.20%.

Personal Exemption Amount - The exemption amount of $3,200 begins to be phased out if a taxpayer’s federal adjusted gross income is more than $100,000 ($150,000 for joint taxpayers). The $3,200 exemption is phased out entirely when the income exceeds $150,000 ($200,000 for joint taxpayers). See Instruction 10 in the Resident tax booklet for the reduced amounts. The additional exemption of $1,000 remains the same for age and blindness.

Dependent Form 502B – This form will be required to be attached to Form 502, Form 505 and Form 515 to determine what exemptions a taxpayer is entitled to claim. Taxpayers claiming more than two dependents on Form 503 must use Form 502.
Increased pension exclusion - Maryland's maximum pension exclusion, which is available to qualifying taxpayers 65 or older, increased from $26,300 to $27,100 for tax year 2012.

Earned Income Tax Credit - Effective January 1, 2012, the Comptroller is required to publish the maximum income eligibility for the state earned income tax credit (EITC) on or before January 1 of each year. The Comptroller shall also notify the employers of such information, and the employers must notify each employee who may be eligible.
Subtraction Modifications - There are three new subtraction modifications created by the Maryland General Assembly for tax year 2012:

o Gain resulting from a payment from the Maryland Department of Transportation as a result of the acquisition of a portion of the property on which your principal residence is located,
o Qualified conservation program expenses up to $500 for an application approved by the Department of Natural Resources to enter into a Forest Conservation and Management Plan,
o Payment received as a result of a foreclosure settlement negotiated by the Maryland Attorney General.
Farmers and Fishermen – The Comptroller will recognize the federal extension of the due date of the fourth quarter 2012 estimated tax payment from March 1, 2013 to April 15, 2013 for farmers and fishermen.

“In the interest of saving taxpayer money, and helping the environment, I always encourage every taxpayer to electronically file their returns,” said the Comptroller. “E-filing guarantees a faster refund than sending it through the mail. Plus, it saves Maryland nearly $2 in processing costs. Since its inception in 1990, e-filing has saved the state nearly $26.5 million in processing returns overall. As always, each of the 12 branch offices throughout the state will assist you in completing and filing your tax return for free.”

For more information on the IRS pushing back the filing start date, please visit http://www.irs.gov/uac/Newsroom/IRS-Plans-Jan.-30-Tax-Season-Opening-For.... For more information on filing Maryland taxes, please visit http://individuals.marylandtaxes.com/incometax/taxseason.asp or call 1-800-MD-TAXES.

"Same-sex couples in the State of Maryland – whether married in this state or in other states – will have the opportunity to file joint tax returns for Tax Year 2013, and will receive the same state tax treatment as any married couple. This will occur either as a result of a legislative action, or if necessary, a regulatory change, either of which is necessary because Maryland’s tax code is conjoined to the IRS unless specifically decoupled. My senior staff and I will work with legislative leaders over the next few weeks to determine the most appropriate course of action.

I proudly testified in strong support of the Civil Marriage Protection Act and remain a steadfast supporter of marriage equality. Honoring Maryland’s hard-earned reputation for fairness and equality, this change will afford same-sex couples with the rights and protections commensurate with their obligations as taxpayers.”

As we approach the heart of the holiday season and the end of 2012, I would like to take this opportunity to thank you for your continued friendship. Indeed, I have so much to be thankful for this year – from my good health and wonderful family, to the support of so many good friends and the opportunity to serve the people of Maryland in what is undoubtedly the best job I have ever had.
 
In that spirit of sincere gratitude, I would also like to let you know that I have decided to seek re-election as Comptroller of Maryland in 2014. This is a decision that I have made after a great deal of personal reflection, and with the sound and thoughtful advice of my wife, Anne, and my two children, Abbe and Nick. It is no secret that in recent months, I have given thought to running for governor. I am humbled by the extraordinary support that my prospective campaign received in every corner of our state, and I am now more convinced than ever that there is a shared desire among Marylanders – irrespective of ideology or party affiliation – for an honest conversation of the fiscal and economic challenges that still lie ahead.
 
I look forward to engaging in that conversation from my office in the Goldstein Treasury Building. I have developed an abiding love for a Comptroller’s Office that has been recognized as the best in the nation, and is admired throughout the State of Maryland for its high standards of efficiency and professionalism.
 
Like so many people on my team, I have devoted my career to providing businesses and families with the exceptional customer service they deserve, while ensuring that everybody pays their fair share of taxes. At the same time, I have relished the opportunity to serve as an independent voice and a tough fiscal watchdog for the taxpayers – whether by opposing wasteful spending on the Board of Public Works, fighting to hold the line on state debt, protecting tax filers from fraudulent preparers, or leading by example and doing a better job for less money within my own office.
 
After nearly six years as Comptroller, it is still a profound honor to hold the office that once belonged to the likes of J. Millard Tawes, Louis Goldstein and William Donald Schaefer. By their words and actions, those Maryland giants set a timeless standard for honorable public service that is still reflected in the Comptroller’s Office today. My goal is to do my job and lead the Comptroller’s Office in a manner that honors their shared legacy.
 
Accordingly, I am looking forward to the year ahead with great anticipation. Thanks to my exceptional team of professionals, I expect to move closer than ever before to a paper-free tax filing season (and will remind you that by filing electronically, you can help my office save taxpayer money while ensuring that you receive your refund within three business days).
 
We also look forward to doing our part to create a level playing field, as well as a fair and predictable regulatory environment, for Maryland businesses that employ local people and reinvest in local communities. I will continue to advocate for a course in financial literacy as a high school graduation requirement. Finally, I shall continue to respect the sacrifice of Maryland’s taxpayers by ensuring that their hard-earned money is spent wisely, and by opposing initiatives that, however well-intentioned, would further weaken an economy that remains fundamentally fragile. These are neither Democratic nor Republican priorities – these are Maryland priorities that are rooted in sheer common sense. As always, I welcome and look forward to your feedback and advice on these important issues.
 
In closing, I would again like to thank you for your friendship and support, while wishing you and your family a peaceful holiday season.
 

ANNAPOLIS, Md. (November 20, 2012) – Working hard to ensure that everyone pays their fair share, Comptroller Peter Franchot announced today that agents from his Field Enforcement Division, in cooperation with the Northern Virginia Cigarette Tax Board, recently confiscated $15,976 worth of contraband cigarettes on Interstate 81 in Hagerstown, Md. In a two-day operation, agents seized 2,477 packs of illegal cigarettes and arrested one man.

“My agents will continue to aggressively crackdown on cigarette smuggling and other illegal tax evasion tactics,” said Comptroller Franchot. “This activity will not be tolerated in Maryland.”

On Thursday, after witnessing the defendant purchase a large quantity of cigarettes at multiple locations in Virginia, which has a lower tax rate for the product, law enforcement officials stopped Brian Wilson, 55, of Tillison, NY, and seized his 1,680 packs of contraband cigarettes as well as his 2005 Suzuki. He has been charged with Transporting Contraband Cigarettes and Possession of Contraband Cigarettes in the State of Maryland. The transporting charge is a felony, which carries a $50 per carton fine and/or two-year imprisonment sentence. The possession offense is a misdemeanor, carrying a $1,000 fine and/or imprisonment, not exceeding one year.

The following day, agents witnessed, Lorraine Brown, 56, of Waterbury, CT, purchasing a large amount of cigarettes in Virginia and stopped her 1989 Volvo on Interstate 81 in Hagerstown. Agents discovered nearly 800 packs of illegal cigarettes worth $5,140. She was issued a criminal citation and agents seized the contraband and her vehicle.
“I applaud my agents and our partners in the law enforcement community for their efforts. We will continue to work together to stop this kind of criminal activity in Maryland,” Franchot said.

Media Contact: Caron Brace, 410-212-9414 (cell)

ANNAPOLIS, Md. (November 8, 2012) – Working hard to ensure that everyone pays their fair share, Comptroller Peter Franchot announced today that agents from his Field Enforcement Division confiscated 8,000 packs of contraband cigarettes on Interstate 70 in Hagerstown, Md. Yesterday, the Comptroller’s agents stopped the driver of a New Jersey registered vehicle and confiscated nearly $52,000 worth of illegal cigarettes.
“My agents will continue to aggressively crackdown on cigarette smuggling and other illegal tax evasion tactics,” said Comptroller Franchot. “This illegal activity will not be tolerated in Maryland.”

Officials arrested the driver of the vehicle, Henry A. Badia, a 33-year-old resident of New York, NY. He has been charged with Transporting Contraband Cigarettes and Possession of Contraband Cigarettes in the State of Maryland. The transporting charge is a felony, which carries a $50 per carton fine and/or two-year imprisonment sentence. The possession offense is a misdemeanor, carrying a $1,000 fine and/or imprisonment, not exceeding one year.

“I look forward to working with the Maryland General Assembly in the Spring to pass legislation that will implement harsher penalties and allow for stricter enforcement for these crimes throughout the state,” continued Comptroller Franchot.

The vehicle was confiscated and the defendant was detained before being released on a $3,000 bond.

Annapolis, Md. (October 25, 2012) –Today, Comptroller Peter Franchot announced the dates and locations for the 2012 Federal and State Tax Institutes, which will be offered in Baltimore, Easton, Frederick and Greenbelt in November. The pre-registration fee is $90 and the walk-in registration fee is $150.

The Internal Revenue Service (IRS) and the Comptroller of Maryland now require individual tax preparers to be registered to prepare taxes in that state of Maryland. Additionally, at both the federal and state level, there is a Continuing Education (CE) requirement for registered preparers. Each year, the Comptroller of Maryland provides the institutes, in conjunction with the IRS, to keep Maryland's preparers up-to-date on new legislation, processes and policies for the upcoming filing season. To better serve the tax preparer community, the Comptroller’s Office is an official CE provider and attendance at one of the affordable one-day institutes will count toward satisfying the CE requirements for Maryland’s registered individual tax preparers.

The 2012 tax institutes are offered at various locations throughout the state from 7:30 a.m. until 5 p.m. on the following dates:

· Friday, November 9, 2012
The Milestone (formerly Krystal Q Reception Hall and Catering)
9630 Technology Drive
Easton, MD 21601

· Wednesday, November 14, 2012
Holiday Inn
5400 Holiday Drive
Frederick, MD 21073

·Friday, November 16, 2012
Martin’s Crosswinds
7400 Greenway Center Drive
Greenbelt, MD 20770

·Monday, November 19, 2012
Martin’s West
6817 Dogwood Road
Baltimore, MD 21244

A total of eight credits toward CE requirements will be given for attending one of the institutes.

In the state of Maryland, tax preparers must apply for, be granted and annually renew a Preparer Tax Identification Number (PTIN) in order to legally prepare returns. Additionally, the preparer must be registered by the Maryland Board of Individual Tax Preparers. The Maryland registration requires that the preparer have a current, valid PTIN, as well as be at least 18 years old with a valid High School diploma or General Education Development (GED).

The registration fee for the initial two-year registration and subsequent bi-annual renewal is $100. The expiration date will be two years from the date of issuance. A renewal applicant must complete at least 16 hours of qualifying continuing education for each two-year registration term, of which at least four hours must be in Maryland tax-related subjects.

Individuals who fall within one of the following categories are exempt from the state registration requirement and can prepare taxes without registering with the Maryland Board of Individual Tax Preparers. These exempt categories include:

· a current, active CPA registered by Maryland or any other state;
· an individual in good standing and admitted to practice law in the state or in another state;
· an individual employed by a local, state, or federal governmental agency but only in performance of official duties;
· an individual enrolled to practice before the Internal Revenue Service who is governed under circular 230;
· an individual serving as an employee of or assistant to an individual tax preparer or an individual exempted under this subsection in the performance of official duties for the individual tax preparer or the individual exempted in bullets above.

For additional information about the 2012 tax institutes, please visit http://taxpros.marylandtaxes.com/fed_state_tax.asp. To learn more about Maryland’s registration requirements, visit http://dllr.maryland.gov/license/taxprep/taxpreplic.shtml.

MEDIA CONTACT: Caron Brace, (410) 212-9414 (cell)

ANNAPOLIS, Md. (October 17, 2012) – Continuing in his efforts to aggressively crackdown on cigarette smuggling and other tax evasion tactics, Comptroller Peter Franchot announced today that agents from his Field Enforcement Division, working in conjunction with Maryland State Police, confiscated thousands of packs of contraband cigarettes on Interstate 95 South. Yesterday, during a routine traffic violation stop near Route 175, Maryland State Trooper Douglas Deaner of the Waterloo Barrack in Howard County noticed that the driver of a New York registered vehicle was transporting a significantly large quantity of contraband cigarettes. The Comptroller’s agents arrived on the scene and seized 6,000 packs of contraband cigarettes, valued at nearly $40,000.

“This illegal activity will not be tolerated in the State of Maryland,” said Comptroller Franchot. “I want to thank Maryland State Trooper Deaner for his invaluable assistance in this case. This is a great example of the tremendous partnership my agency has with law enforcement agencies throughout the state.”

Following the joint investigation, officials arrested the driver of the vehicle, El-Housseni Hassan, a 23-year-old resident of Brooklyn, NY. He has been charged with Transporting Contraband Cigarettes and Possession of Contraband Cigarettes in the State of Maryland. The transporting charge is a felony, which carries a $50 per carton fine and/or two-year imprisonment sentence. The possession offense is a misdemeanor, carrying a $1,000 fine and/or imprisonment, not exceeding one year. Comptroller Franchot has been a strong advocate for harsher penalties and stricter enforcement for these crimes throughout the state.

“Working together with their colleagues, my agents will continue to be vigilant as we work to arrest and prosecute those who blatantly disregard Maryland’s tobacco laws which protect law-abiding businesses and keep our communities free of contraband,” continued Comptroller Franchot.

The vehicle was confiscated and the defendant detained, pending an initial hearing before a Howard County District Court Commissioner.

Media Contact: Caron Brace, 410-212-9414 (cell)