Fill - Free fillable Form 2016: 502CR INCOME TAX CREDITS FOR INDIVIDUALS (Comptroller of Maryland) PDF form

MARYLAND

FORM

502CR

INCOME TAX CREDITS

FOR INDIVIDUALS

Attach to your tax return.

COM/RAD-012

2016

Print Using Blue or Black Ink Only

1. Enter your taxable net income from line 20, Form 502 (or line 10, Form 504). ....................... 1.

2. Taxable net income in other state. Write on this line only the net income which is taxable in both the other state

and Maryland. If you are taxed in the other state on income which is not taxable in Maryland, do not include that

amount here. NOTE: When the tax in the other state is a percentage of a tax based on your total income

regardless of source, you must apply the same percentage to your taxable income in the other state to

determine the income taxable in both states. ................................................ 2.

3. Revised taxable net income (Subtract line 2 from line 1.) If less than zero, enter zero. .................. 3.

4. Enter the Maryland tax from line 21, Form 502 (or line 11, Form 504). This is the Maryland tax based on your

total income for the year. .............................................................. 4.

5. Tax on amount on line 3. Compute the Maryland tax that would be due on the revised taxable net income by

using the Maryland Tax Table or Computation Worksheet contained in the instructions for Forms 502 or 504.

Do not include the local income tax .................................................... 5.

6. Tentative State tax credit (Subtract line 5 from line 4.) If less than zero, enter zero. ................... 6.

7. Enter the Local tax from line 28, Form 502 (or line 18, Form 504). This is the Local tax based on your total

income for the year. .................................................................. 7.

8. Local tax on amount on line 3. Compute the Local tax that would be due on the revised taxable net income by

multiplying line 3 by your Local tax rate .0 ............................................ 8.

9. Tentative Local tax credit (Subtract line 8 from line 7.) If less than zero, enter zero. ................... 9.

10. Tentative Total tax credit (Add line 6 and line 9.) ............................................ 10.

11. Total state and local tax shown on tax return(s) filed with the state of (Enter 2-letter state code, code must be

entered for credit to be allowed) Enter the amount of your 2016 income tax liability (after deducting

any credits for personal exemptions) to the other state and locality in the other state (where applicable). Do not

enter state or locality tax withheld from your W-2 forms. It is important that a copy of the tax return that

was filed with the other state and/or locality be attached to your Maryland return ............. 11.

12. Credit for income tax paid to other state and/or locality. Your credit for taxes paid to another state and/or locality

is the smaller of the tax actually paid (line 11) or the reduction in Maryland tax resulting from the exclusion of

income in the other state and/or locality (line 10). Write the lesser of line 11 or line 10. ............... 12.

State and Local Credits Allowed

13. State Credit for Income Tax Paid to other state (Lesser of line 6 or line 12). Enter on line 1, Part K ......

13.

14. Local Credit for Income Tax Paid to other state (Subtract line 13 from line 12.) Enter on line 1, Part L ....

14.

Read Instructions for Form 502CR. Note: You must complete and submit pages 1 through 3 of this form to receive credit for the items listed.

PART A - TAX CREDITS FOR INCOME TAXES PAID TO OTHER STATES AND LOCALITIES

If you were a part-year resident, do not claim a credit for tax paid on nonresident income you included on line 12 of the Form 502.

If you are claiming a credit for taxes paid to multiple states and/or localities, see instructions.

Your Social Security Number Spouse's Social Security Number

Your First Name Initial

Your Last Name

Spouse's First Name Initial

Spouse's Last Name

MARYLAND

FORM

502CR

INCOME TAX CREDITS

FOR INDIVIDUALS

Attach to your tax return.

COM/RAD-012

2016

Page 2

NAME SSN

PART B - CREDIT FOR CHILD AND DEPENDENT CARE EXPENSES

1. Enter your federal adjusted gross income from line 1 of Form 502 or line 17, column 1 of

Form 505 or Form 515 ...................................................................1.

2. Enter your federal Child and Dependent Care Credit from federal Form 2441 ............................2.

3. Enter the decimal amount from the chart in the instructions that applies to the amount on line 1 .............3.

4. Multiply line 2 by line 3. Enter here and on Part K, line 2 ........................................

PART C - QUALITY TEACHER INCENTIVE CREDIT

1. Enter the Maryland public school system or a State or local correctional

facility or qualified juvenile facility in which you are employed and teach .......1. 1.

2. Enter amount of tuition paid to: ................2. 2.

3. Enter amount of tuition reimbursement ...............................3. 3.

4. Subtract line 3 from line 2 ........................................4. 4.

5. Maximum credit. ...............................................5. 5.

6. Enter the lesser of line 4 or line 5 here. ..............................6. 6.

7. Total (Add amounts from line 6, for Taxpayers A and B) Enter here and

on Part K, line 3 ..........................................................

PART D - CREDIT FOR AQUACULTURE OYSTER FLOATS

1. Enter the amount paid to purchase an aquaculture oyster float(s)

Enter here and on Part K, line 4. This credit is limited. See Instructions ..............................

PART E - LONG-TERM CARE INSURANCE CREDIT: (THIS IS A ONE-TIME CREDIT.)

Answer the questions and see instructions below before completing Columns A through E for each person

for whom you paid long-term care insurance premiums.

Question 1 - Did the insured individual have long-term care insurance prior to July 1, 2000? ........................ Yes No

Question 2 - Is the credit being claimed for the insured individual in this year by any other taxpayer? .................. Yes No

Question 3 - Has credit been claimed by anyone for the insured individual in any other tax year? .................... Yes No

Question 4 - Is the insured individual for whom the credit is being claimed a nonresident of Maryland? ................. Yes No

If you answered YES to any of the above questions, that insured person does NOT qualify for the credit.

Complete Columns A through D only for insured individuals who qualify for credit. Enter in Column E the lesser of the amount of premium paid for

each insured person or: • $390 for those insured who are 40 or less, as of 12/31/16

• $500 for those insured who are over age 40, as of 12/31/16.

Add the amounts in Column E and enter the total on line 5 (total) and on Part K, line 5.

Column A

Name of Qualifying Insured

Individual

Age

Column B

Social Security No.

of Insured

Column C

Relationship to

Taxpayer

Column D

Amount of Premium Paid

Column E

Credit Amount

1. 1.

2. 2.

3. 3.

4. 4.

TOTAL

Enter the Name of Qualied Employer

Taxpayer A Taxpayer B

PART F - CREDIT FOR PRESERVATION AND CONSERVATION EASEMENTS

PTE members may not use the Form 502CR to claim this credit.

1. Enter the portion of the total current-year conveyance amount, and any

carryover from prior year(s), attributable to each taxpayer ................. 1. 1.

2. Enter the amount of any payment received for the easement by each

taxpayer during 2016 ............................................ 2. 2.

3. Subtract line 2 from line 1 ........................................ 3. 3.

4. Enter the amount from line 21 of Form 502; line 32c of Form 505; line 33 of

Form 515; line 13 of Form 504 or $5,000, whichever is less. See instructions ... 4. 4.

5. Enter the lesser of line 3 or 4 here. (If you itemize deductions,

see Instruction 14.) ............................................. 5. 5.

6. Total (Add amounts from line 5 for Taxpayers A and B.). Enter here and on Part K, line 6 ................

7. Excess credit carryover. Subtract line 6 from the sum of lines 3A and 3B ...............................7.

Name of Institution(s)

Taxpayer A Taxpayer B

1500 00 1500 00

MARYLAND

FORM

502CR

INCOME TAX CREDITS

FOR INDIVIDUALS

Attach to your tax return.

COM/RAD-012

2016

Page 3

NAME SSN

PART G - HEALTH ENTERPRISE ZONE PRACTITIONER TAX CREDIT ** must attach required certification

1. Credit (certified by the Department of Health and Mental Hygiene). Enter here and on Part K, line 7 .........

PART H – COMMUNITY INVESTMENT TAX CREDIT ** must attach required certification

This credit is limited to individual taxpayers who have elected not to claim this credit on Form 500CR. If you have an Excess Carryover on Form

500CR attributable to any credit other than the Community Investment Tax Credit (CITC), you are not eligible to claim the CITC on Form 502CR.

You must use Form 500CR. Also, PTE members may not elect to use Form 502CR to claim the CITC.

1. Enter the amount of Excess CITC Carryover from Part X of your 2015 Form 500CR ........................1.

2. Amount of approved contributions ...........................................................2.

3. Enter 50% of line 2. ....................................................................3.

4. Enter the amount from line 3 or $250,000, whichever is less. ......................................4.

5. Add line 1 and line 4. Enter the result here and on Part K, line 8 ..................................

PART I – ENDOW MARYLAND TAX CREDIT **must attach required certification

This credit is limited to individual taxpayers who have elected not to claim this credit on Form 500CR.

1. Enter the amount of Excess Endow Maryland Tax Credit Carryover from 2015 ...........................1.

2. Amount of approved donation to a qualified permanent endowment fund ...............................2.

3. Enter 25% of line 2 .....................................................................3.

4. Enter the amount from line 3 or $50,000, whichever is less ........................................4.

5. Add line 1 and line 4. Enter the result here and on Part K, line 9 ..................................

Note: Line 2 of Part I requires an addition to income. See Instruction 12.

PART J – PRECEPTORS IN AREAS WITH HEALTH CARE WORKFORCE SHORTAGES TAX CREDIT **must attach

required certification

1. Physician Preceptorship Tax Credit: Enter amount certified by Department of Health and Mental Hygiene

(See Instructions) ......................................................................1.

2. Nurse Practitioner Preceptorship Tax Credit: Enter amount certified by Department of Health

and Mental Hygiene (See Instructions) .......................................................2.

3. Add line 1 and line 2. Enter the result here and on Part K, line 10 .................................

PART K - INCOME TAX CREDIT SUMMARY

1. Enter the amount from Part A, line 13 (If more than one state, see Instructions.) ........................1.

2. Enter the amount from Part B, line 4 ........................................................2.

3. Enter the amount from Part C, line 7 ........................................................3.

4. Enter the amount from Part D, line 1 ........................................................4.

5. Enter the amount from Part E, line 5. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.

6. Enter the amount from Part F, line 6 .........................................................6.

7. Enter the amount from Part G, line 1 ........................................................7.

8. Enter the amount from Part H, line 5 ........................................................8.

9. Enter the amount from Part I, line 5 .........................................................9.

10. Enter the amount from Part J, line 3 ........................................................10.

11. Total (Add lines 1 through 10.) Enter this amount on line 24 of Form 502; line 14 of Form 504;

line 34 of Form 505 or line 35 of Form 515 ..................................................11.

PART L – LOCAL INCOME TAX CREDIT SUMMARY

1. Enter the amount from Part A, line 14 (If more than one state, see Instructions.) ........................1.

Enter this amount on line 31 of Form 502; line 19 of Form 504.

PART M- REFUNDABLE INCOME TAX CREDITS

1. Neighborhood Stabilization Credit. Enter the amount and attach certification. ..........................

2. Heritage Structure Rehabilitation Tax Credit (See Instructions for Form 502S). Attach certification(s). ........

3. Refundable Business Income Tax Credit (See Instructions for Form 500CR.) You must file your return electronically to

claim a business income tax credit.

4. IRC Section 1341 Repayment Credit. (See Instructions and Administrative Release 40.) Attach documentation ..

5. Flow-through Nonresident PTE tax (See Instructions for required attachments.) ........................

6. Total. (Add lines 1 through 5.) Enter this amount on line 43 of Form 502, line 46 of Form 505

or line 51 of Form 515 ...................................................................6.

MARYLAND

FORM

502CR

INCOME TAX CREDITS FOR

INDIVIDUALS INSTRUCTIONS

2016

Page 1

GENERAL INSTRUCTIONS

Purpose of Form. Form 502CR is used to claim personal income tax

credits for individuals (including resident duciaries).

You may report the following tax credits on this form: the Credit for

Income Taxes Paid to Other States and Localities, Credit for Child and

Dependent Care Expenses, Quality Teacher Incentive Credit, Long-

Term Care Insurance Credit, Credit for Preservation and Conservation

Easements, Credit for Aquaculture Oyster Floats, the Health Enterprise

Zone Practitioner Income Tax Credit, Community Investment Tax Credit,

the Endow Maryland Tax Credit, Preceptors in Areas with Health Care

Workforce Shortages Tax Credit, Heritage Structure Rehabilitation Tax

Credit, the Neighborhood Stabilization Credit, Flow-Through Nonresident

PTE Tax and IRC Section 1341 Repayment Credit. You must le Form

500CR electronically to claim a business income tax credit other than the

Community Investment Tax Credit and Endow Maryland Tax Credit.

The Neighborhood Stabilization Credit, the Heritage Structure

Rehabilitation Tax Credit and/or certain business tax credits from Form

500CR and the IRC Section 1341 Repayment Credit are refundable. All of

the other credits may not exceed the state income tax.

Excess credit for the Preservation and Conservation Easements Tax

Credit, Community Investment Tax Credit and Endow Maryland Tax

Credit may be carried forward to the next tax year. Excess amounts of

the other credits cannot be carried forward. Note: Resident duciaries

may use Form 502CR to claim only a credit for income taxes paid

to other states and/or localities or a Credit for Preservation and

Conservation Easements.

Name and Other Information. Type or print the name(s) as shown

on Form 502, 505, 515 or 504 in the designated area. Enter the Social

Security Number for each taxpayer.

Form 502CR must be attached to the annual return (Form 502,

504, 505 or 515).

PART A - CREDIT FOR INCOME TAXES PAID TO OTHER STATES

AND LOCALITIES

If you are a Maryland resident (including a resident duciary) and you

paid income tax to another state, you may be eligible for State and local

tax credits on your Maryland return. Nonresidents (ling Form 505, 515

or 504) are not eligible for this credit.

Find the state to which you paid a nonresident tax or the state of the

locality to which you paid a nonresident tax in one of the following groups.

The instructions for that group will tell you if you are eligible for credit

and should complete Part A of Form 502CR. You must le your Maryland

income tax return on Form 502 and complete lines 1 through 21 and line

28 of that form, or on Form 504 and complete lines 1 through 11 and

line 18. Then complete Form 502CR Parts A, K, and L and attach to Form

502 or 504.

A completed, signed copy of the income tax return led in the other state

and/or locality must also be attached to Form 502 or 504.

CAUTION: Do not use the income or withholding tax reported on the

wage and tax statement (W-2 form) issued by your employer for the

credit computation. Use the taxable income and the income tax calculated

on the return you led with the other state.

Claiming Credit for Taxes Paid to Multiple States and Localities If

you are claiming credit for taxes paid to multiple states, a separate Form

502CR must be completed for each state. Total the amount from each

Form 502CR, Part A, line 13 and line 14. Using only one Form 502CR as

a summary section, record the total amount from line 13 of the separate

Forms 502CR on line 1, Part K of the summary Form 502CR. Record the

total amount from line 14 of the separate Forms 502CR on line 1, Part L

of the summary Form 502CR.

GROUP I - Nonreciprocal - Credit is taken on the Maryland resident

return.

Alabama - AL

Arizona - AZ

Arkansas - AR

California - CA

Colorado - CO

Connecticut - CT

Delaware - DE

Georgia - GA

Hawaii - HI

Idaho - ID

Illinois - IL

Indiana - IN

Iowa - IA

Kansas - KS

Kentucky - KY

Louisiana - LA

Maine - ME

Massachusetts - MA

Michigan - MI

Minnesota - MN

Mississippi - MS

Missouri - MO

Montana - MT

Nebraska - NE

New Hampshire - NH

New Jersey - NJ

New Mexico - NM

New York - NY

North Carolina - NC

North Dakota - ND

Ohio - OH

Oklahoma - OK

Oregon - OR

Pennsylvania - PA

(except wage income)

Rhode Island - RI

South Carolina - SC

Tennessee - TN

Texas - TX

Utah - UT

Vermont - VT

Virginia - VA

(except wage income)

Washington, DC - DC

(except wage income)

West Virginia - WV

(except wage income)

Wisconsin - WI

Territories and

Possessions of the

United States

American Samoa - AS

Guam - GU

Northern Mariana

Island - MP

Puerto Rico - PR

U.S. Virgin Islands - VI

A Maryland resident (including a resident duciary) having income from

one of these states must report the income on the Maryland return Form

502 or 504. To claim a credit for taxes paid to the other state, and/or local

jurisdiction in the other state, complete Form 502CR and attach it and a

copy of the other state’s nonresident income tax return (not just your W-2

Form) and, if applicable, the local jurisdiction's nonresident income tax

return to your Maryland return.

GROUP II - Reciprocal for wages, salaries, tips and commission income

only.

Pennsylvania - PA Washington, DC - DC

Virginia - VA West Virginia - WV

Maryland has a reciprocal agreement with the states included in Group II.

The agreement applies only to wages, salaries, tips and commissions. It

does not apply to business income, farm income, rental income, gain from

the sale of tangible property, etc. If you had such income subject to tax in

these states, complete Form 502CR and attach it and a copy of the other

state’s nonresident income tax return (not just your W-2 Form) and, if

applicable, the local tax jurisdiction's nonresident income tax return to

your Maryland return.

If you had wages, plus income other than wages from a state listed in

Group II, you should contact the taxing authorities in the other state to

determine the proper method for ling the nonresident return.

NOTE: If you had wages subject to tax in a locality in Pennsylvania, you

may le Form 502CR to claim a State and local tax credit. Enter the

amount of tax that you paid to the locality on line 11, Part A of the Form

502CR.

GROUP III - No state income tax - No credit allowed.

Alaska - AK South Dakota - SD

Florida - FL Washington - WA

Nevada - NV Wyoming - WY

You must report income from these states on your Maryland resident

return. You cannot claim any credit for income earned in these states

because you did not pay any income tax to the other state.

PART A – IMPORTANT NOTE FOR DUAL RESIDENTS

A person may be a resident of more than one state at the same time for

income tax purposes. If you must le a resident return with both Maryland

and another state, use the following rules to determine where the credit

should be taken:

1. A person who is domiciled in Maryland and who is subject to tax as a

resident of any of the states listed in Group I or II can claim a credit

on the Maryland return (Form 502) using Part A of Form 502CR.

2. A person domiciled in any state listed in Group I or II who must le

a resident return with Maryland must take the credit in the state of

domicile.

PART A – SPECIAL INSTRUCTIONS

Members of Pass-through Entities - When a partnership, S corporation,

limited liability company (LLC) or business trust les a composite return

on behalf of its partners, shareholders or members with states in Groups

I and II, Maryland resident partners, shareholders or members may claim

a credit for their share of the tax paid. Attach a copy of the composite

return led with each of the other states. In lieu of the composite return,

attach a statement(s) from the pass-through entity showing your share

of the total income, your share of the taxable net income and your share

of the tax liability in each of the other states.

Complete a separate Form 502CR Part A for each state, entering your

share of the taxable net income on line 2 and your share of the tax liability

on line 11. Do not enter the amount of tax withheld on your behalf as

shown on the Maryland Schedule K-1 or other statement issued to you

by the pass-through entity. Total the amount from each Form 502CR,

Part A, line 13. Using only one summary Form 502CR, record the total on

Part K, line 1. Total the amount from each Form 502CR, Part A, line 14.

MARYLAND

FORM

502CR

INCOME TAX CREDITS FOR

INDIVIDUALS INSTRUCTIONS

2016

Page 2

Using the summary Form 502CR, record the total on Part L, line 1. Write

"SUMMARY" across the top of page 1 of the summary Form 502CR.

If the Maryland resident must le an individual nonresident return

reporting the partnership, S corporation, LLC or business trust income,

a separate Form 502CR must be completed for each state and submitted

with a copy of the return led with the other state.

For both composite returns and individual returns, no credit is available

for taxes paid to states in Group III.

Shareholders of S Corporations - Maryland resident shareholders can

claim a credit for taxes paid by an S corporation to a state which does

not recognize federal S corporation treatment. A copy of the corporation

return led in the other state is required to be attached to the Maryland

return. A separate Form 502CR should be completed for each state

showing the following information:

__________% x ________________ = _______________

Stock ownership

percentage

Corporation taxable income Line 2, Part A, Form 502CR

__________% x ________________ = _______________

Stock ownership

percentage

Corporation tax Line 11, Part A, Form 502CR

NOTE: A preliminary calculation using Form 502 must be made before

calculating the credit on Form 502CR. Complete lines 1 through 21 and

line 28 on Form 502 to determine the amounts to be used for the 502CR

computation.

The credit amount shown on lines 13 and 14 of Part A, Form 502CR then

must be included as an addition to income on line 5 of the Form 502

you will le. (See Instruction 12 - Additions to Income - in the Resident

Instruction Booklet)

D.C. Unincorporated Business Franchise Tax - Self-employed

individuals and partners in a partnership who are subject to D.C.

unincorporated business franchise tax may claim a credit on Form 502CR.

A copy of the D.C. return is required for self-employed individuals and

for partners, a K-1 or other statement from the partnership showing the

partner’s share of income and the partner’s share of the D.C. tax.

Installment Sales in Another State - You may be eligible for credit

for taxes paid to another state and/or locality for gain recognized on

installment, sales proceeds, even if the other state and/or locality required

the total be recognized in an earlier tax year. The gain must have been

deferred for federal tax purposes, but fully taxed in the year of the sale

by another state and/or locality that does not recognize the deferral. The

credit allowed is the amount of the gain taxed in Maryland in the current

year multiplied by the lesser of:

• the highest State plus local tax rate used on your Maryland tax return

• the tax rate imposed by the other state and/or locality on the gain.

PART B - CREDIT FOR CHILD AND DEPENDENT CARE EXPENSES

If you are eligible for a Child and Dependent Care Credit on your federal

income tax return, Form 1040 or 1040A for tax year 2016, you may

be entitled to a credit on your Maryland state income tax return. The

credit starts at 32.5% of the federal credit allowed, but is phased out for

taxpayers with federal adjusted gross incomes above $41,000 ($20,500

for individuals who are married, but le separate income tax returns). No

credit is allowed for an individual whose federal adjusted gross income

exceeds $50,000 ($25,000 for married ling separately). Use the CREDIT

FOR CHILD AND DEPENDENT CARE EXPENSES CHART to determine the decimal

amount to be entered on line 3 of Part B.

PART C - QUALITY TEACHER INCENTIVE CREDIT

If you are a qualied teacher, you may be able to claim a credit against

your State tax liability for tuition paid to take graduate-level courses

required to maintain certication. This credit applies to individuals who:

a. Currently hold a standard professional certicate or advanced

professional certicate;

b. Are employed by a county/city board of education in Maryland, a

state or local correctional facility, or a juvenile correctional facility as

listed below in the note;

c. Teach in a public school or qualied facility and receive a satisfactory

performance;

d. Successfully complete the courses with a grade of B or better; and

e. Have not been fully reimbursed by the state/county/city for these

expenses.

Only the unreimbursed portion qualies for the credit.

Each spouse that qualies may claim this credit. Complete a separate

column in the worksheet for each spouse.

NOTE: Qualied juvenile facilities are: the Alfred D. Noyes Children's

Center; the Baltimore City Juvenile Justice Center; the Charles H. Hickey,

Jr. School; the Cheltenham Youth Facility; the J. DeWeese Carter Center;

the Lower Eastern Shore Children's Center; the Thomas J. S. Waxter

Children's Center; the Victor Cullen Center; the Western Maryland

Children's Center; and the youth centers.

INSTRUCTIONS

Line 1 Enter the name of the Maryland public school system or State or

local correctional facility or qualied juvenile facility in which you

are employed and teach.

Line 2 Enter the amount of tuition paid for graduate-level courses for

each qualifying teacher and the name of the institution(s) to

which it was paid.

Line 3 Enter the amount received as a reimbursement for tuition from

your employer.

Line 5 The maximum amount of credit allowed is $1,500 for each

qualifying individual.

Line 6 The credit is limited to the amount paid less any reimbursement

up to the maximum amount allowed for each qualifying individual.

Enter the lesser of line 4 or line 5.

Line 7 Enter the total of line 6, for Taxpayers A and B. Also enter this

amount on Part K, line 3.

CREDIT FOR CHILD AND DEPENDENT CARE EXPENSES CHART

If your filing status is Married Filing Separately and

your federal adjusted gross income is:

Decimal Amount

For all other filing statuses, if your federal

adjusted gross income is:

At Least

But less than At least But less than

$0-

$20,501 .3250 $0 $41,001

$20,501

$21,001 .2925 $41,001 $42,001

$21,001

$21,501 .2600 $42,001 $43,001

$21,501

$22,001 .2275 $43,001 $44,001

$22,001

$22,501 .1950 $44,001 $45,001

$22,501

$23,001 .1625 $45,001 $46,001

$23,001

$23,501 .1300 $46,001 $47,001

$23,501

$24,001 .0975 $47,001 $48,001

$24,001

$24,501 .0650 $48,001 $49,001

$24,501

$25,001 .0325 $49,001 $50,001

$25,001 or over .0000 $50,001 or over

MARYLAND

FORM

502CR

INCOME TAX CREDITS FOR

INDIVIDUALS INSTRUCTIONS

2016

Page 3

PART D - CREDIT FOR AQUACULTURE OYSTER FLOATS

A credit is allowed for 100% of the amounts paid to purchase new

aquaculture oyster oats that are designed to grow oysters at or under

an individual homeowner’s pier. The devices must be buoyant and assist

in the growth of oysters for the width of the pier. In the case of a joint

return, each spouse is entitled to claim the credit, provided each spouse

purchases or contributes to the purchase of a oat. The credit amount

is limited to the lesser of the individual’s state tax liability for that year

or the maximum allowable credit of $500. In the case of a joint return,

each spouse must calculate his/her own state tax liability for limitation

purposes.

PART E - LONG-TERM CARE INSURANCE CREDIT

A one-time credit may be claimed against the state income tax for the

payment of qualied long-term care (LTC) insurance premiums as dened

by the IRS (Publication 502) for a policy to insure yourself, or your spouse,

parent, stepparent, child or stepchild, who is a resident of Maryland.

A credit may not be claimed if:

a. The insured was covered by LTC insurance prior to July 1, 2000;

b. The credit for the insured is being claimed in this year by another

taxpayer;

c. The credit is being or has been claimed by anyone in any other tax

year; or

d. The insured is a nonresident of Maryland.

The credit is equal to the LTC premiums paid with a maximum per insured

of:

Amount Age of Insured as of 12/31/16

$390 40 or less

$500 over 40 years

SPECIFIC INSTRUCTIONS

• Answer Questions 1 through 4. If you answered “yes” for any of the

questions, no credit is allowed for that individual.

• Complete Columns A through D of the worksheet for each qualifying

insured individual who qualies for the credit. If more space is required,

attach a separate statement.

• Enter in Column E the amount of premiums paid for each qualifying

insured individual up to the maximum for that age group.

• Add the amounts in Column E and enter the total on line 5. Also enter

this amount on Part K, line 5.

PART F - CREDIT FOR PRESERVATION AND

CONSERVATION EASEMENTS

Businesses or individuals may be eligible for a credit for an easement

conveyed to the Maryland Environmental Trust, the Maryland Agricultural

Land Preservation Foundation or the Maryland Department of Natural

Resources to preserve open space, natural resources, agriculture, forest

land, watersheds, signicant ecosystems, viewsheds or historic properties

if:

1. the easement is perpetual;

2. the easement is accepted and approved by the Board of Public Works;

and

3. the fair market value of the property before and after the conveyance

of the easement is substantiated by a certied real estate appraiser.

Individuals who are eligible to claim the Credit for Preservation and

Conservation Easements and who are not PTE members must claim this

credit on Part F of the Form 502CR. PTE members who are eligible for this

credit must claim the credit on Business Income Tax Credit Form 500CR.

The credit is equal to the difference in the fair market values of the property

reduced by payments received for the easement. If the property is owned

jointly by more than one individual, such as a married couple, each

individual owner is entitled to the credit based on their percentage

of ownership. The credit amount is limited to the lesser of the individual’s

state tax liability for that year or the maximum allowable credit of $5,000,

per owner, who qualies to claim the credit. Complete a separate column

in the worksheet for each spouse. In the case of a joint return, each

spouse must calculate their own state tax liability for limitation purposes.

Use the rules for ling separate returns in Instruction 8 in the Resident

booklet to calculate each spouse’s Maryland tax. In the case of a duciary

return, the duciary will complete the column for Taxpayer B only.

If the individual’s allowable credit amount exceeds the maximum of

$5,000, up to $5,000 can be carried forward each subsequent year until

the allowable credit is used up or 15 years, whichever rst occurs.

Complete lines 1-7 of Part F. If you itemize deductions, see Instruction

14 in the Resident booklet. For line 1, enter the amount by which the

fair market value of the property before the conveyance of the easement

exceeds the fair market value after the conveyance as substantiated by

a certied real estate appraiser, plus any carryover from the prior year.

The carryover amount can be found on Part F, line 7 of Form 502CR for

tax year 2015.

For additional information, contact the Maryland Environmental Trust at

410-514-7900, www.dnr.state.md.us/met, the Maryland Agricultural

Land Preservation Foundation at 410-841-5860, or the Department of

Natural Resources at 410-260-8367.

PART G – HEALTH ENTERPRISE ZONE PRACTITIONER INCOME

TAX CREDIT

If you are a qualied “Health Enterprise Zone (HEZ) Practitioner,” you may

be able to claim a credit against your State tax liability for income that

you earned for practicing health care in a HEZ. To apply for certication,

you must be a health care practitioner who is licensed or certied under

the Maryland Health Occupations Article, and who provides:

1. Primary care, including obstetrics, gynecological services, pediatric

services, or geriatric services;

2. Behavioral health services, including mental health or alcohol and

substance abuse services; or

3. Dental services.

To be eligible to claim this tax credit, you must:

1. Be a HEZ practitioner who practices health care in a HEZ;

2. Demonstrate competency in cultural, linguistic, and health literacy

in a manner determined by the Maryland Department of Health and

Mental Hygiene (DHMH);

3. Accept and provide care for patients enrolled in the Maryland

Medical Assistance Program and for uninsured patients; and

4. Meet any other criteria required by DHMH to be certied for this

credit.

Eligibility for this tax credit is limited to funds budgeted. Applicants

seeking certication will be approved on a rst-come, rst-served

basis. To become certied, the HEZ practitioner may apply to the non-

prot community organization or local government approved by DHMH.

Go to DHMH website at: dhmh.maryland.gov for more information.

INSTRUCTIONS

Line 1 Enter on line 1 the amount of the tax credit certied by DHMH.

This amount is also entered on Part K, line 7.

This credit is limited to the State tax. There is no carryover to another

year. No credits may be earned for any tax year beginning on or after

January 1, 2017.

If you have hired qualied employees to work in a HEZ, you may be

entitled to a HEZ Hiring Tax Credit. This credit is computed on Maryland

Business Tax Credit Form 500CR and requires DHMH certication. The

credit may only be claimed on an electronically led amended Maryland

income tax return. You may download instructions from our Web site at

www.marylandtaxes.com.

PART H - COMMUNITY INVESTMENT INCOME TAX CREDIT

Businesses or individuals who contribute to approved Community

Investment Programs may be eligible for a credit against the Maryland

State income tax. Contributions must be made to a nonprot organization

approved by the Department of Housing and Community Development

(DHCD). The taxpayer must apply to and receive approval by the DHCD

for each contribution for which a credit is claimed.

Individuals who are eligible to claim the Community Investment Tax

Credit (CITC), and who are not PTE members may elect to claim this

credit on Part H of Form 502CR, instead of claiming the credit on Form

500CR. However, an individual may not claim this credit on both Form

500CR and Form 502CR. PTE members who are eligible for this credit

must claim the credit on Business Income Tax Credit Form 500CR.

MARYLAND

FORM

502CR

INCOME TAX CREDITS FOR

INDIVIDUALS INSTRUCTIONS

2016

Page 4

Individuals who anticipate having a carryover of the CITC are advised to

use Form 500CR instead of Form 502CR. Individuals who have an existing

carryover on Part X of their 2015 Form 500CR may elect to use Form

502CR if their Excess Carryover Credit is attributable only to the CITC.

The credit is limited to 50% of the approved contributions (including real

property) not to exceed $250,000.

NOTE: A copy of the required approval from the DHCD must be included

with Form 502CR.

SPECIFIC INSTRUCTIONS

Line 1 Enter the amount of excess carryover from Part X of your 2015

Form 500CR (if the carryover is attributable only to the CITC).

Line 2 Enter the amount of approved contributions on line 2.

Line 3 Enter 50% of line 2.

Line 4 Enter the amount from line 3 or $250,000, whichever is less.

Line 5 Add line 1 and line 4. Enter the result on line 5 and on Part K,

line 8.

This credit is not refundable and is applied only against the Maryland

State income tax. To the extent the credit is earned in any year and it

exceeds the State income tax, you are entitled to an excess carryover

of the credit until it is used or it expires ve years after the credit was

earned, whichever comes rst.

For more information contact:

Department of Housing and Community Development

Division of Neighborhood Revitalization

2 N. Charles St., Suite 450

Baltimore, MD 21202

410-209-5800

citc.nr@mdhousing.org

PART I – ENDOW MARYLAND INCOME TAX CREDIT

A taxpayer who makes a donation to a qualied permanent endowment

fund at an eligible community foundation may be eligible for a credit

against the Maryland State income tax. The taxpayer must apply to the

Maryland Department of Housing and Community Development (DHCD)

for a certication for the donation. This certication must be attached to

the Form 502CR at the time the Maryland income tax return is led.

Individuals who are eligible to claim the Endow Maryland income tax

credit, and who are not PTE members may elect to claim this credit on

Part I of Form 502CR, instead of claiming the credit on Form 500CR.

However, an individual may not claim this credit on both Form 500CR and

Form 502CR. PTE members who are eligible for this credit must claim the

credit on Business Income Tax Credit Form 500CR.

Individuals who anticipate having a carryover of the Endow Maryland

income tax credit are advised to use Form 500CR, instead of Form 502CR.

The credit is limited to 25% of the approved donation (in cash or publicly

traded securities) not to exceed $50,000.

NOTE: A copy of the required approval from the DHCD must be included

with Form 502CR.

SPECIFIC INSTRUCTIONS

Line 1 Enter the amount of excess Endow Maryland Income Tax Credit

carryover from 2015.

Line 2 Enter the amount of approved donation to a qualied permanent

endowment fund.

Line 3 Enter 25% of line 2.

Line 4 Enter the amount from line 3 or $50,000, whichever is less.

Line 5 Add line 1 and line 4. Enter the result on line 5 and on Part K,

line 9.

This credit is not refundable and is applied only against the Maryland

State income tax. To the extent the credit is earned in any year and it

exceeds the State income tax, you are entitled to an excess carryover

of the credit until it is used, or it expires ve years after the credit was

earned, whichever comes rst.

NOTE: The amount of donation shown on line 2 requires an addition to

income. See Instruction 12 in the Maryland Resident Instruction Booklet.

For more information contact:

Department of Housing and Community Development

Division of Neighborhood Revitalization

2 N. Charles St., Suite 450

Baltimore, MD 21202

410-209-5800

endowmaryland.nr@maryland.gov

PART J – PRECEPTORS IN AREAS WITH HEALTH CARE WORKFORCE

SHORTAGES TAX CREDIT

If you are a qualied licensed physician or a qualied nurse practitioner

who served without compensation as a preceptor, you may be eligible to

claim a nonrefundable credit against your State tax liability. There are two

credits for qualied preceptors. The rst credit on line 1 is only available

for licensed physicians. The second credit on line 2 is available for both

licensed physicians and nurse practitioners.

A licensed physician who served as a physician preceptor in a preceptorship

program authorized by an accredited medical school in Maryland may claim

a credit on line 1 in the amount of $1,000 for each student for whom the

licensed physician served as a physician preceptor without compensation.

For purposes of claiming the credit on line 1, “preceptorship program”

means an organized system of clinical experience that, for the purpose of

attaining specied learning objectives, pairs an enrolled student of a liaison

committee on medical education-accredited medical school in Maryland

or an individual in a postgraduate medical training program in Maryland

with a licensed physician who meets the qualications as a preceptor. To

qualify for the credit, the licensed physician must have worked in an area

of Maryland identied as having a health care workforce shortage by the

Department of Mental Health and Hygiene. The licensed physician must

have worked a minimum of three rotations, each consisting of 160 hours

of community-based clinical training. The amount of this credit may not

exceed $10,000.

A nurse practitioner or licensed physician who served as a preceptor in a

preceptorship program approved by the Maryland Board of Nursing may

claim a credit on line 2 in the amount of $1,000 for each nurse practitioner

student for whom the nurse practitioner or licensed physician served as

a preceptor without compensation. For purposes of claiming the credit

on line 2, “preceptorship program” means an organized system of clinical

experience that, for the purpose of attaining specied learning objectives,

pairs a nurse practitioner student enrolled in a nursing education

program that is recognized by the Maryland Board of Nursing with a

nurse practitioner or licensed physician who meets the qualications as

a preceptor. To qualify for the credit, a nurse practitioner or licensed

physician must have worked in an area of Maryland identied as having a

health care workforce shortage by the Department of Mental Health and

Hygiene. The nurse practitioner or licensed physician must have worked a

minimum of three rotations, each consisting of 160 hours of community-

based clinical training. The amount of this credit may not exceed $10,000.

Eligibility for these credits is limited to funds budgeted. Applicants seeking

certication will be approved on a rst-come, rst-served basis. Go to the

Department of Mental Health and Hygiene website at dhmh.maryland.

gov for more information.

INSTRUCTIONS

Line 1 Enter on line 1 the amount of the tax credit certied by DHMH

for a licensed physician who served as a physician preceptor

in a preceptorship program, paired with enrolled student(s) of

a liaison committee on medical education-accredited medical

school in Maryland or an individual in a postgraduate medical

training program in Maryland

Line 2 Enter on line 2 the amount of the tax credit certied by DHMH

for a nurse practitioner or licensed physician who served as

a preceptor in a preceptorship program, paired with nurse

practitioner student(s) enrolled in a nursing education program

recognized by the Maryland Board of Nursing.

Line 3 Add line 1 and line 2. Enter the result on line 3 and on Part K, line

10. This credit is limited to the State tax. There is no carryover to

another year.

NOTE: A copy of the required certication from the Department of Health

and Mental Hygiene must be included with Form 502CR .

PART K - INCOME TAX CREDIT SUMMARY

This part is to summarize Parts A through J. If the total from Part K, line

11 exceeds the state tax, the excess will not be refunded.

MARYLAND

FORM

502CR

INCOME TAX CREDITS FOR

INDIVIDUALS INSTRUCTIONS

2016

Page 5

PART L - LOCAL TAX CREDIT SUMMARY

This part is to summarize the total local tax credit available from Part A.

If the total from Part L, line 1 exceeds the local tax, the excess will not be

refunded. See the Instructions to Part A for questions concerning credit

claimed for taxes paid to multiple states and/or localities.

PART M - REFUNDABLE INCOME TAX CREDITS

Line 1 NEIGHBORHOOD STABILIZATION CREDIT

If you live in the Hillendale, Northbrook, Pelham Woods or

Taylor/Dartmouth areas of Baltimore County, you may qualify

for this credit. Credit for homes purchased in Baltimore County

must have been applied for by December 31, 2005.

After certication by Baltimore County, you may claim an income

tax credit equal to the property tax credit granted by Baltimore

County. Enter the amount on Part M, line 1 and attach a copy of

the certication.

Line 2 HERITAGE STRUCTURE REHABILITATION TAX CREDIT

See instructions for Form 502S.

Line 3 REFUNDABLE BUSINESS INCOME TAX CREDITS

NOTE: You must le your income tax return electronically

to claim any of the refundable credits listed below:

See Business Tax Credit Form 500CR Instructions for

qualications for the One Maryland Economic Development

Tax Credit, the Biotechnology Investment Incentive Tax Credit,

the Cybersecurity Investment Incentive Tax Credit, the Health

Enterprise Zone Hiring Credit, the Small Business Research &

Development Tax Credit, the Clean Energy Incentive Tax Credit,

the Film Production Activity Tax Credit and the Aerospace,

Electronics, or Defense Contract Tax Credit. You may download

instructions from our Web site at www.marylandtaxes.com.

Line 4 IRC SECTION 1341 REPAYMENT CREDIT

If you repaid an amount this year reported as income on a prior

year federal return that was greater than $3,000, you may

be eligible for an IRC Section 1341 Repayment credit. Attach

documentation. For additional information, see Administrative

Release 40.

Line 5 FLOW-THROUGH NONRESIDENT PTE TAX

If you are the beneciary of a trust or a Qualied Subchapter

S Trust for which nonresident PTE tax was paid, you may be

entitled to a credit for your share of that tax. Enter the amount

on this line and attach both the Maryland Schedule K-1 (504) for

the trust and a copy of the Maryland Schedule K-1 (510) issued

to the trust by the PTE.

If you are a member of a PTE for which nonresident tax was paid,

you may be entitled to a credit for your share of that tax. Enter

the amount on this line and attach Maryland Schedule K-1 (510)

issued to you and to the partnership, limited liability company, or

S Corporation, by the PTE.

Line 6 Add lines 1 through 5. Enter the total on the appropriate line of

the income tax form being led.

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