TaxEngine - Basic Instructions for Preparing and Filing Maryland Tax Returns
In preparing the state tax return, most information will carry from the federal return. The income and withholding will carry to the state from entries on the W-2. Be sure the state information has been entered on the W-2 input screen. Other income items will carry from the federal input according to the state designated.
If the taxpayer or spouse is a Maryland teacher, they may be able to claim a credit against their State tax liability for tuition paid to take graduate-level courses required to maintain certification. This credit applies to individuals who:
a. currently hold a standard professional certificate or advanced professional certificate;
b. are employed by a county/city board of education in Maryland;
c. teach in a public school and receive a satisfactory performance evaluation for teaching;
d. successfully complete the courses with a grade of B or better; and
e. have not been fully reimbursed for these expenses. Only the unreimbursed portion qualifies for the credit.
Each spouse that qualifies may claim this credit. Click on the 'tax forms' button to access the MD 502-CR form to enter the information.
If you electronically file your balance due return and it is rejected, you have until the 30th of April to send it again, get it accepted and pay your tax due before any interest charges will be incurred. Check the box on the general information screen to indicate that your return was filed, rejected and is being resubmitted.
If you have additional information to enter, click on the 'tax forms' button. Input for all the state forms is available.
Injured Spouse - 502INJ
If you are filing a Form 502INJ - Injured Spouse Claim Form - you can prepare your MD-502 on TaxEngine.com and print it out. DO NOT ELECTRONICALLY FILE. Next, go to www.marylandtaxes.com or call 410-260-7951 from Central Maryland or 1-800-638-2937 from elsewhere to obtain 502INJ. Fill out the 502INJ attach it to the front of your 502. Write "INJURED SPOUSE" in the upper left-hand corner of the 502. Mail to the address on the instruction letter printed with your return.
Part-Year Resident
You are considered a part-year resident of Maryland if, during 2007, you moved your permanent home into or out of Maryland. You must pay Maryland income tax on income you earned, received or accrued while living in Maryland.
Nonresident
If you are a resident of another state and worked in Maryland during 2007, you are required to file a Maryland income tax return and are required to pay Maryland income tax on salary wages and other employee compensation for work performed in Maryland.
If you are a Maryland resident but worked in another state, all of your income is subject to tax, no matter where it is earned, except income earned from out-of-state business activity.
Note: Where a reciprocal agreement exists (DC, PA, VA or WV), the reciprocal checkbox should be marked. Once marked, the program will exclude wages earned in the nonresident state according to the reciprocity agreement. See state instructions for any variation to the general rule. The reciprocal feature is only programmed to work for a full-year nonresident and a full-year resident scenario. Part-year resident returns will need to be manually adjusted for reciprocal agreements, if necessary.