March Distribution of Local Income Taxes Released

The Comptroller’s Office has released its report on the March distribution of the local income tax. From the Comptroller’s Office:

Attached is a comparison of the March distribution of the local income tax and other local revenues.  This distribution, which totals $110.4 million for the counties, is comprised of the local shares of delinquent taxes and fiduciary payments received in the first half of fiscal year 2017 as well as certain grants.  The distribution for delinquent taxes and fiduciary payments totals $69.3 million.  The March distribution also includes the disparity and teacher’s retirement grants for the third quarter of fiscal year 2017 ($34.2 million and $6.9 million, respectively).

The delinquent distribution (Table 2) represents the local tax liability reported on late-filed and amended returns for the prior two years and net tax collections for earlier years.  The $49.6 million distribution represents the local tax liability on returns for tax years 2013 and 2014 which were filed between July 1 and December 31, 2016, net tax collections received during that period for tax years 2014 and prior.  The delinquent distribution in March 2016 included collections received from the statutory 2015 tax amnesty program, which explains the high growth rate experienced in March 2016 and the decline for March 2017.  The delinquent distribution accounts for relatively small numbers of returns and, therefore is inherently volatile.  It is also supported by ongoing compliance activities through the Comptroller’s data warehouse and the Comptroller/MVA compliance program.

Table 3 shows the detail of the fiduciary distribution for returns received in the first half of fiscal year 2017.  The $19.7 million distribution (largely reflecting tax year 2015 activity) is highly concentrated within two counties and Baltimore City. The decline of 25.1% comes after strong growth in the prior year of 49.0%.

The third quarter disparity and teacher’s retirement grants distribution, determined by law, is also attached.  If you have any questions about the March 31 distribution, please contact Jim Pasko of the Revenue Administration Division at (410) 260-7521 or Jan Akbhavasut at (410) 260-7501 or Jason Brohawn at (410) 260-6159.

March 2017 Counties Tables