Workaround for Maryland Business Tax Credits (specifically Buy Maryland Cybersecurity Tax Credit)

[CDegener]

Has anyone found a workaround for Maryland business tax credits that get passed through to personal returns?  I have two clients that own a business that received the Buy Maryland Cybersecurity Tax Credit; the business is an S-Corp.  The ProSeries program (or at least my version - ProSeries Professional) does not allow entry on 502CR for business tax credits in Part CC, line 3, but instead the program "Help" says to submit the returns with the "Certificate of Approval" and the state will make the adjustments on their end.  I included this certificate as well as the Maryland K1s while e-filing but neither client received the credit from Maryland.

When I reached out to Maryland to inquire, they said that amended returns need to be filed to claim the credit - and of course the inclusion of this credit isn't available through the software.

So, I am stuck with ProSeries/ Intuit saying the state will take care of it on their end while the state is saying that we need to take care of it on our end. 

Any help/ advice/ guidance is appreciated.

[sjrcpa]

And did MD also tell you that returns with business credits need to be efiled?

[CDegener]

Correct, the related form for the credit (Form 502CR) specifically states that the return must be electronically filed to claim the business tax credit.

[dascpa · Accepted solution]

502CR has been an issue for many years. Required to be e-filed, but the MD502 doesn't support the line for the credit. I tried overriding it and it failed e-file, even with turning off the error check.

I complained to ProSeries and the Comptroller of MD.  Their basic answer was to buy another software that supported the line.  So I tried a Pay Per Return Lacerte and that failed too.

I contacted the Comptroller (the prior one) and his assistant told me to mail in the return stating the issue and asking for an exclusion to e-file.  For 5+ years this method did work, even though it was slow to be processed.

I also did a request for software update for many years and P.S. ignored it. Not enough people were complaining.

[CDegener]

Thanks very much, appreciate the reply and input, and will try as you suggest and mail the returns with the request for e-filing exception.  Hopefully the Comptroller's office will accept this.

This seems a simple enough programming item... hard to believe it's gone unfixed for so long.  I'll surely get a complaint into P.S. as well, though likely nothing will change.