Charles T. Dillon Maryland Tax Attorney (410) 321-7696
State of Maryland Taxes
The below Maryland agencies are required to verify all taxes have been paid before an individual or business license can be renewed:
Helpful Links
Talk first to a tax attorney before confiding in your accountant anything about your IRS tax problems!
- Seize Your Property - The Comptroller of Maryland regularly seizes property from residents and businesses for unpaid taxes. For example, if you have unresolved tax problems with the State of Maryland, the Maryland Comptroller may seize funds from your bank accounts, seize you liquor license, take the cash you have on your premises, as well as seize your equipment, vehicles, inventory and real property. Additionally, if the State of Maryland owes you any money for goods or services you or your business has provided, or as a personal or business income tax refund will either be applied to unpaid tax balances or held until you file any missing tax returns.
- File a Tax Lien – Tax liens are not only a favorite tool of the IRS to collect unpaid taxes, but the Maryland Comptroller also frequently files tax liens against Maryland residents and businesses when their taxes go unpaid. The Maryland Comptroller does this by filing the tax lien with the clerk of the circuit court where your business or residence is located. Liens are very powerful legal instruments in Maryland and have the same force and effect as a court issued judgment lien. Tax liens, once filed, may affect adversely your credit rating, prevent you from getting loans, or even cause you to lose your job. For example, many employers in Maryland require their employees to maintain satisfactory credit scores as a condition of their employment. Adverse employment consequences, including demotions and terminations, resulting from the filing of tax liens are frequently seen in the financial services sector as well as the within those jobs where employees must maintain active security clearances to work. Once a Maryland tax lien is recorded with a clerk of a circuit court, legal notice has been publicly given to all that the State of Maryland has a claim against your assets. Tax liens can also adversely affect your ability to sell any property of value you may own, such as your house.
- Wage Garnishment – The State of Maryland may also be able to garnish your wages to collect unpaid taxes. Luckily, there are limits to how much money the Maryland Comptroller can garnish from your paycheck because taxpayers should have enough left to pay for basic living expenses. In Maryland, your wages can be garnished in the same amount that applies to judgment creditors, in accordance with the Salary Lien provisions.
- Driver’s License and Business License Holds and Non-renewals – Yes, that’s right … if you or your business have unpaid (and undisputed) State of Maryland taxes and/or your business has unpaid unemployment insurance contributions, the Motor Vehicle Administration is not required to renew your driver’s license or renew your vehicle’s registration! Obviously, not having one’s driver’s license or the ability to drive a registered vehicle can severely disrupt your life as well as your livelihood. Problems with State of Maryland taxes should not prevent you from being able to legally drive your vehicle and/or earn a living. Also, not only does the Maryland Comptroller coordinate with the Motor Vehicle Administration to prevent driver’s license renewals, but the Maryland Comptroller also coordinates with the Maryland Department of Labor, Licensing and Regulation (DLLR) to prevent the renewal of business licenses when a business (or business owner) has unresolved tax problems.
- Interest and Penalties – Unpaid Maryland taxes can be very burdensome for many Maryland residents and businesses, however, the interest and penalties the Maryland Comptroller will also assess against you only make a painful situation more miserable. Thankfully, the Maryland Comptroller cannot assess you interest and penalties without first sending you a tax payment notice. However, if you do not respond to that first tax payment notice, you will receive an assessment notice that includes substantial penalty and interest charges added to the tax amount owed. Under Maryland law, the amount stated in the assessment notice is presumed accurate. If you want to dispute this amount then an appeal, requesting a hearing, must be filed within 30 days of the assessment. This 30-day appeal window is very important to follow because collection actions being taken against you and/or your business will begin after the expiration of the 30-day period. Properly appealing this notice may stop the Maryland Comptroller from pursuing authorized collection actions. Maryland law requires the Comptroller to charge interest at the annual rate of 12 percent and penalty charges for late payments can be up to up to 25 percent of the tax amount owed.
- Collection Agency Referral – The Maryland Comptroller regularly assigns tax cases to private collection agencies. In addition to the nuisance of collection agencies contacting you for payment, additional fees may be added. Unfortunately, once your tax case has been referred to a private collection agency, any payment arrangements must be made through that agency. Once you have satisfied your tax debt, the tax lien filed against you will be released. However, in order for you to promptly have your credit reports updated to show the lien’s release, you cannot rely on the Maryland Comptroller to promptly act on your behalf. It is your responsibility to submit certified copies of the lien release to those agencies if you need prompt correction to credit reports.
- Listed on the Comptroller's Website - The Comptroller of Maryland is serious about retrieving unresolved tax liabilities. As a part of the collection process, the Maryland Comptroller will also post on its website taxpayers with very large tax liabilities.
- Other State of Maryland tax matters
Maryland Business &
Professional License Hold
The State of Maryland takes collecting unpaid taxes very serious, and the Comptroller of Maryland’s aggressive enforcement actions to collect those unpaid taxes can create numerous tax problems for individuals and businesses alike. Therefore, it essential for individuals and businesses earning income in Maryland to make paying all taxes on a timely basis an absolute priority. If you or your business cannot pay your owed taxes in a timely manner, then alternative payment arrangements must be made with the State of Maryland as soon as possible. Once agreed to, though, failing to make those payments can create very serious tax problems, as will refusing to make such payment arrangements. In these situations, the Maryland Comptroller may enforce one or more of the following actions against you because of your Maryland tax problems:
502 Baltimore Avenue
Towson, Maryland 21204, USA
Phone: +1 (410) 321-7696
Email: cdillon@dillonlegal.com