Section 8-204 - Taxable net earnings - Computation. - Maryland Statutes

§ 8-204. Taxable net earnings - Computation.
 

(a)  In general.- A financial institution shall compute its net earnings: 

(1) based on the accounting period used as its fiscal year; and 

(2) subject to the modifications required under this section, in the manner that a corporation computes, for purposes of the income tax, the Maryland modified income. 

(b)  Additions.- A financial institution shall add to its net earnings computed under subsection (a) of this section the amounts that, even if otherwise allowed to be subtracted under § 10-307(b) and (g) (1) and (4) of this article, equal: 

(1) profit realized from the sale or exchange of bonds issued by this State or a political subdivision of this State; 

(2) dividends received from foreign corporations and included in federal gross income under § 78 of the Internal Revenue Code; 

(3) interest derived from a United States obligation; 

(4) State tax-exempt interest received from a mutual fund and allowed to be subtracted under § 10-307(g)(4) of this article; and 

(5) interest excluded from federal gross income under § 103 of the Internal Revenue Code and derived from a bond: 

(i) issued by a state or a public corporation, special district, political subdivision of a state or their instrumentalities; or 

(ii) under § 150 of the Internal Revenue Code, treated as a bond issued by a state or a public corporation, special district, or political subdivision of a state or their instrumentalities. 

(c)  Subtractions.- A financial institution shall subtract from its net earnings computed under subsection (a) of this section interest expense incurred to purchase or carry a bond as defined in subsection (b) (5) of this section. 
 

[An. Code 1957, art. 81, § 128A; 1988, ch. 2, § 1; ch. 565; 1989, ch. 110, § 1; ch. 178, § 3; ch. 545, § 1; 1991, ch. 55, § 1; 1994, ch. 265; 1995, ch. 127, § 1; 1996, ch. 10, § 1; ch. 99, § 1; 1997, ch. 14, § 1; 2010, ch. 72, § 5.]