If you are a Maryland resident and you have income taxed by another state, you may be entitled to a tax credit on your Maryland return. Non residents do not qualify for this credit.

QUALIFICATIONS

To qualify for the credit, you must file a tax return with the other state where you incurred a proper tax liability. If taxes were paid on wages you earned in another state or on certain other income from any other state ( such as business or farm income), you may claim a credit on your Maryland return. There are some exceptions to this, as explained below.

If you are treated as a dual resident for income tax purposes - a resident of both Maryland and another state - you must claim a tax credit in your state of domicile.

CLAIMING THE CREDIT

The tax credit may be claimed only on Maryland Forms 502 and 504.

To Claim The Credit:

• Complete the return you're filing for the other state.
• Complete Maryland Form 502 (or Form 504 if you are filing a fiduciary return) through the line labeled "Maryland Tax".
• If you are filing Form 502, complete Part A of Form 502CR. If you are claiming credit for taxes paid to more than one state, you must file a separate Form 502CR for each state.
• File Form 502CR with your Maryland Form 502, along with a copy of the other state's return. Fiduciaries need only file Form 504 and include a copy of the other state's return.

If the credit exceeds your tax liability, the unused credit may not be carried forward to any other tax year.

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