COM/RAD-049
MARYLAND
FORM
MW508CR
BUSINESS INCOME TAX
CREDITS INSTRUCTIONS
To be used by nonprofit 501(c)(3)
organizations only. ATTACH TO YOUR MW508.
2020
GENERAL INSTRUCTIONS
Purpose MW508CR is used to claim the following business tax credits
against employer withholding tax (tax-exempt organizations only). The
paper version of Form 500CR has been discontinued. Form MW508CR has
been created to allow employers who are tax-exempt under IRC 501(c)
(3) to claim a business tax credit against the Maryland withholding tax.
See Administrative Release 34 for more information.
Tax Credit Part
Commuter Tax Credit* M
Maryland Disability Employment Tax Credit* C
*Tax-exempt organizations For application of these credits against
employer withholding tax, complete and attach Form MW508CR to
Form MW508 (Annual Employer Withholding Reconciliation Return). See
Administrative Release 34.
Tax Year or Period Use this form to accompany the 2020 Form MW508.
When and Where to File Form MW508CR must be attached to the annual
return (Form MW508) and led with the Comptroller of Maryland,
Revenue Administration Division, 110 Carroll Street, Annapolis,
Maryland 21411-0001.
PART C - MARYLAND DISABILITY EMPLOYMENT TAX CREDIT
General Requirements Businesses that employ persons with
disabilities, as determined by the Division of Rehabilitation Services
(DORS) in the Maryland State Department of Education and/or by the
Maryland Department of Labor may be eligible for tax credits for wages
paid to, and for child care expenses and transportation expenses paid
on behalf of, qualied employees.
Qualifying employees with a disability are those who are certied as such
by the DORS (or by the DLLR for a disabled veteran).
For certication or for additional information, contact:
Maryland State Department of Education
Division of Rehabilitation Services
2301 Argonne Drive
Baltimore, MD 21218
1-888-554-0334 or 410-554-9442
dors.maryland.gov
o r,
Maryland Department of Labor
1100 N. Eutaw St., Room 201
Baltimore, MD 21201
410-767-2047
A “Qualied Employee” with a disa bility means an individual who:
1. meets the denition of an individual with a disability as dened
by the Americans with Disability Act;
2. has a disability that presently constitutes an impediment to
obtaining or maintaining employment or to transitioning from
school to work; and
3. is ready for employment; or
4. is a veteran who has been discharged or released from active duty
by the American Armed Forces for a service-connected disability.
An employee must not have been hired to replace a laid-o employee
or to replace an employee who is on strike or for whom the business
simultaneously receives federal or state employment training benets.
Qualifying child care expenses are those expenses incurred by a business
to enable a qualied employee with a disability to be gainfully employed.
Transportation expenses are those expenses incurred by a business entity
to enable a qualied employee with a disability to travel to and from work.
Specic Requirements
Part C-I Credit for employees with a disability hired A credit is
allowed for each new employee with a disability for a two-year period
beginning with the year the employee was qualied. The credit for each
disabled employee hired is equal to 30% of the rst $9,000 of qualied
rst year wages and 30% of the rst $9,000 of qualied second year
wages.
The employer is not entitled to claim the credit until employment has
continued for at least one full year unless the employee: (a) voluntarily
leaves the employer, (b) becomes further disabled or death occurs or
(c) is terminated for cause. The credit must be prorated for the portion
of the year the employee worked unless the employee voluntarily left
to take another job.
Part C-II Credit for Child Care and Transportation Expenses An
additional credit is allowed for expenses incurred by the employer for
approved day care services for a child or children of a qualied employee,
or for transportation expenses that are incurred to enable a qualied
employee to travel to and from work. A credit of up to $900 is allowed
for the rst year of employment and up to $900 for the second year. To
verify if a child care center qualies as an approved provider, contact
the Department of Human Resources, Child Care Administrator for the
county or city in which the child care center is located.
Part C-Summary Add lines 4 and 8.
PART M - COMMUTER TAX CREDIT
A credit is allowed for businesses that conduct or operate a trade or
business in Maryland and provide commuter benets for their employees.
The business must pay a portion of the cost of travel between the
employee’s home and the workplace. Qualied commuter benets
include the cost of transit instruments (tickets, passes, vouchers, fare
cards, smartcards and tokens) used to transport an employee of the
business to or from home and the workplace. The portion of the cost
an employer pays to provide a “Guaranteed Ride Home” program or for
a parking “Cash-Out” program for their employees also are qualied
commuter benets.
Travel must be on a qualied mass transit vehicle or system, or in a
vanpool. The vanpool vehicle must seat at least 6 adults and be used
primarily to transport employees between home and the workplace.
The credit is the lesser of 50% of the cost of providing commuter benets
or $100 per month for each employee.
For more information contact:
Mass Transit Administration, Marketing Division
6 St. Paul Street, 2nd Floor
Baltimore, MD 21202-1614
410-767-8746
www.commuterchoicemaryland.com
PART BB - BUSINESS TAX CREDIT SUMMARY
This part is used to summarize all available tax credits reported on this
form. If the total credits available in a particular tax year exceed the
withholding tax developed for that year, the excess may not be refunded.
