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Level 2
February 20, 2021
Question

Maryland Credit For Unemployment Taxes

  • February 20, 2021
  • 11 replies
  • 42 views

Maryland passed a law that unemployment state withholding taxes could be claimed as a credit on your Maryland Return. I can't find the line item under 502SU subtractions. Does anyone know where to claim the state tax credit?

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11 replies

IRonMaN
Level 15
February 20, 2021

They just passed it the other day.  Revenue departments and software companies don't move that fast, you need to give them some time.

Slava Ukraini!
Level 6
February 20, 2021

@IRonMaN is correct.  I am in baltimore county. withholdings are always credits against income tax but the maryland unemployment received will also need to be entered as a maryland subtraction on the 502SU once the authorities and then intuit re-programs the system. go to marylandtaxes.gov for more info

IRonMaN
Level 15
February 20, 2021

I'm correct?  Holy crap - first time that has happened this year.  I maybe should retire from here before I break my winning streak.

Slava Ukraini!
Level 2
February 25, 2021

A new form 502LU for MD Unemployment subtraction...Oh Boy

The RELIEF Act allows Maryland taxpayers to subtract certain amounts from their federal adjusted gross income (FAGI). In order to be eligible for the subtraction, these amounts must be included in a taxpayer’s FAGI for the same year. Please note certain payroll protection programs under the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act have already been excluded from FAGI under federal law. As these amounts are not included in a taxpayer’s FAGI, they are not eligible for subtraction on the Maryland return.
In order to claim these subtractions, individuals must complete Maryland Form 502LU and file it along with their return.
Two distinct subtractions from income are available under the RELIEF Act for tax years 2020 and 2021:
• Unemployment Benefits: To the extent included in federal adjusted gross income, taxpayers may
subtract the amount of unemployment benefits received during the taxable year on their Maryland
return. This subtraction is only available to taxpayers with a filing status of single, married filing
separate, or dependent with a FAGI of less than $75,000, and filers with married filing joint, head of
household, or surviving spouse status with a FAGI of less than $100,000.

pkgreenAuthor
Level 2
February 25, 2021

Thank you so much. 😉

Level 2
April 1, 2021

I called the Comptroller's Office a few weeks ago and they said it would be 4 to 6 weeks BEFORE the form would be ready. However, there was a press release on March 29 from the State  saying that the form was ready and would be available by March 31.  I just downloaded the most recent update from Intuit and the from is not there yet. Not sure why the state needs a special form. The Fed return deducts the $10,200 (if you meet the income guidelines) and passes  the corrected adjusted amount to the MD 502.  So it seems typical state of MD bureaucratic crap that we ALWYS get from the Comptroller's Office.