As 2021 begins, too many Maryland families are struggling to avoid eviction, put food on the table and pay their bills, while many small businesses are hanging on by a thread.
For months, I have been urging Gov. Larry Hogan to initiate a Maryland stimulus to provide financial relief for our most vulnerable citizens. My agency could immediately deposit these funds into accounts through our existing tax system. All we need is the political will to make this happen because Maryland has more than a billion dollars sitting in its reserves.
If ever there was a time to tap these funds to help our fellow Marylanders, it is now.
While COVID-19 vaccines offer hope that an end to this pandemic is near, we can’t escape the fact that its economic impact is devastating and will take years to recover from. Fortunately, Maryland’s strong economic foundation will help us rebound more quickly than others.
This is why I feel it’s fiscally responsible to use the state’s Fiscal Year 2020 Fund Balance and our Rainy Day Fund to not only issue state stimulus payments of $2,000 to our most deserving families — taxpayers with at least one dependent who earned less than $50,000 as a single filer or $100,000 as joint filers — but to also invest $250 million immediately to help save as many small businesses as possible.
In the meantime, I have taken action under my authority as the state’s tax administrator to immediately help our local businesses and employees keep critical cash on hand by extending the deadline for most business-related state taxes due in January, February and March to April 15.
This essentially serves as a penalty-free, interest-free loan to give businesses a breather at a time when they need it most. There is no need to file for an extension and the action is revenue-neutral for the State’s economy since all taxes owed are required to be paid down the road.
We made this same tax forbearance decision in the early days of the pandemic and after that 90-day extension, businesses filed their returns and made their payments as required. Many business owners I have spoken with said this move last year was critical to keeping their doors open and paying employees while awaiting the federal and state economic relief funds.
It’s the least we can do to try and run out the clock on this deadly pandemic and help Marylanders who, through no fault of their own, have either lost their jobs or had to either close or significantly scale back their business operations.
What does this tax forbearance mean for employees and businesses?
In addition to relieving pressure on businesses to make their monthly state tax payments, self-employed individuals and independent contractors who typically pay quarterly estimated income tax payments in January can file those returns and payments by April 15.
Similarly, employer withholding payments due between February and April now will be due on April 15.
These new extensions apply only to tax filings under my authority as the Comptroller of Maryland. You may need to consult other state agencies on deadlines for other tax filings, such as personal property or unemployment insurance.
Additionally, I have written to IRS Commissioner Charles Rettig urging him to make similar extensions on federal tax payments that would be due during the year’s first quarter.
The Comptroller’s Office is here to help you during this difficult time.
A new year always offers a chance for a fresh start and renewed optimism. While 2020 tested all of us, I hope these extensions are among the many steps we as public officials can take to make 2021 a much brighter and more successful year.
Peter Franchot is the 33rd Comptroller of Maryland.