July 1 always ushers in a host of new laws and changes to existing ones that impact our daily lives and, in many cases, end up costing us more money. But this year, some of the laws are designed to put money back into the pockets of taxpayers.
Among one of the most fought over tax reductions in the legislature in recent years is the so-called death tax, the tax that is paid on estates. The federal government exempts estate tax for the first $5 million. Maryland will eventually get there, but the change to the law phases in allowable exemption. On Tuesday, it went up from $1 million to $1.5 million for deaths after July 1, 2015.
The state also has given a small bump to the earned income tax credit. Those who qualify will eventually see the credit increase to 28 percent by 2018, but this year's change bumps it up from 25 percent to 25.5 percent.
The state is also following the lead of many other states in increasing the minimum wage. After much haggling and heated debate, the legislature passed the measure that will see the minimum wage increase to $8 an hour at first, and eventually increase to $10.10 an hour. The increase to $8 an hour doesn't take effect until January.
Residents can also now get a tax credit of 25 percent if the donate to endow a qualified community foundation. The law was designed to spur investment in community groups.
Of course, matching the laws that will put money back in to our pockets are laws which will take more out. The biggest of those, perhaps, is an increase in the gas tax. While this year's increase will only be about half a penny a gallon, that tax will continue to add to the cost of gas and the legislature tied the increases to the annual inflation increases. Lawmakers say the increase will add $4.4 billion over the next six years to the transportation fund.
Gas prices already are trending higher this summer, so the additional increase is going to mean that drivers will be paying a lot more at the pump today than they were a year ago. Last week, the average price of a gallon of gas in Maryland was already 23 cents higher than over the same period last year.
Changes to laws which impact our wallets that take effect July 1 following a legislative session are as commonplace and predictable as fireworks on the Fourth of July. This year, at least, some of the changes will put some money back in to our pockets as well.
