IRS National Tax Security Awareness Week Runs Nov. 27 to Dec. 1

ANNAPOLIS, Md. (November 21, 2017) ― For the second year, the Internal Revenue Service, state tax agencies – including the Maryland Comptroller’s Office – and the tax industry will host National Tax Security Awareness Week to encourage individual and business taxpayers to take steps to protect their tax data and identities in advance of the 2018 filing season.

Starting Monday, November 27, the focus will be on issues posing a threat to individuals and businesses and steps to protect taxpayers from cybercriminals. In recent years, the IRS, state tax agencies and the tax industry – partners in the Security Summit – have enacted a series of defenses to combat tax-related identity theft.

“We are resolute in our commitment to protecting Marylanders’ financial information and the integrity of our tax system,” Maryland Comptroller Peter Franchot said. “Throughout the year, my employees work tirelessly to identify fraudulent returns from thieves trying to drain the state coffers and from cheating Maryland citizens.”

Throughout the country, Summit partners and other consumer, business and community groups will host more than 25 events to raise tax data awareness during the week. In Maryland, the Internal Revenue Service’s Stakeholder Liaison – including the Maryland Comptroller’s Office – and the Maryland Society of Accounting and Tax Professionals will take part in a forum from 9:30 to 11:30 a.m. Tuesday, November 28, at the University of Phoenix, 8830 Stanford Boulevard, Room 128, in Columbia. Panelists will discuss ways to combat cyber thieves looking to trick people into disclosing sensitive information so they can file fraudulent tax returns.

The holiday season is an especially vulnerable time for online thievery as Marylanders do their holiday shopping and provide credit card and other personal information. Throughout the country, 145 million American have had their names, addresses and Social Security numbers stolen from a variety of locations.

The IRS and states have put many new defenses in place to help protect taxpayers from identity theft. The new IRS protections have worked well and some key indicators of identity theft on tax returns have dropped by around two-thirds since 2015. These protections are especially helpful if criminals only have names, addresses and Social Security numbers. However, the cybercriminals may try to obtain more specific financial details from taxpayers and tax professionals.

During the awareness week, taxpayers and tax professionals will learn:

  • Basic steps to protect themselves and their tax data online, such as using security software, strong passwords and data encryption.
  • What to do if they are a data breach victim, such as placing a freeze on their credit accounts and the signs of tax-related identity theft.
  • How cybercriminals use phishing emails to bait them into disclosing information.
  •  The dangers W-2 Scam that has made identity theft victims of thousands of employees.
  • Those small businesses also are subject to identity theft and should take steps to protect themselves.

The Summit partners will urge taxpayers to protect their tax and financial information by:

  • Learning to recognize and avoid phishing emails, threatening phone calls and texts from thieves posing as legitimate organizations such as bank, credit card company and government organizations (including the IRS), and to not click on links or download attachments from unknown or suspicious emails.
  • Always using security software with firewall and anti-virus protections. Making sure the security software is always turned on and can automatically update. Encrypting sensitive files such as tax records you store on your computer. Using strong passwords.
  • Protecting personal data. Using strong unique passwords for each online account. Don’t routinely carry a Social Security card, and making sure tax records are secure. Treat personal information like you do your cash; don’t leave it lying around.

For more information, visit irs.gov.

Comptroller Franchot Unveils Legislation Aimed at Reforming Maryland’s Dysfunctional Beer Laws

BALTIMORE, Md. (November 20, 2017) – Citing the significant economic, fiscal and community contributions of Maryland’s craft brewers and the industry’s immense potential, Comptroller Peter Franchot today announced a major legislative package that would fundamentally reform the antiquated laws and burdensome regulations that govern Maryland craft breweries.

The Reform on Tap Act of 2018 proposes the following:

• Removes all limits on beer production, taproom sales and take-home sales;
• Repeals the “buy-back” provision that requires brewers to purchase their beer from distributors at a marked-up cost if they exceed the 2,000-barrel limit on taproom sales.
• Lifts unnecessary restrictions for take-home sales;
• Guarantees the issuance of Class B or D beer licenses to microbreweries upon request;
• Lets local jurisdictions set guidelines for taproom operating hours;
• Allows smaller brewers to self-distribute;
• Eliminates franchise law requirements; and
• Removes restrictions on contract brewing that inhibits start-up businesses.

“We simply cannot ignore the fact that our laws and regulatory framework have stood in the way of the limitless potential of Maryland’s craft beer industry. This is going to take us from last in the region, to the first in the nation,” said Comptroller Franchot, the state’s chief alcohol regulator. “Craft breweries are innovative businesses, and each has a measureable impact on our economy and in their local communities. They attract local residents and tourists alike who appreciate locally-sourced ingredients, environmentally sustainable practices and each taproom’s distinct style.”

The legislation reflects the findings of the Comptroller’s Reform on Tap Task Force, which held eight meetings during this summer and fall to get a better grasp of the state’s current laws and the challenges and opportunities that lie ahead for craft brewers. The 40-member task force represented every region in the state and industry stakeholders including brewers, distributors, retailers, consumers and lawmakers from both parties.

“Comptroller Franchot’s legislation would provide the framework needed for Maryland’s craft beer industry to thrive” said Adam Benesch, co-founder of Union Craft Brewing in Baltimore. “Maryland brewers, distributors and retailers all stand to benefit from the continued growth and success of our industry.”

“In an extremely competitive marketplace, Maryland craft beer is an essential component to our success,” said Joe Petro, owner of Hair O’ The Dog Wine and Spirits in Easton. “Every day, customers visit my store simply because they’ve tried a new Maryland craft beer at a taproom and now want to purchase a six-pack.”

When compared to neighboring states and the District of Columbia, Maryland is home to the most restrictive laws on production, distribution and taproom sales of craft beer.

The obstacles in current Maryland law were illuminated with the passage of House Bill 1283 during the 2017 General Assembly session. Since its passage, the consequences of the bill and the state’s anti-craft beer laws have become glaringly evident. For example, Virginia has aggressively recruited Maryland brewers to relocate to the Commonwealth, and Flying Dog Brewery recently decided to cancel its plans for a $54 million expansion in Frederick, resulting in lost jobs and economic activity.

The legislation announced today corrects the harmful provisions included in House Bill 1283 and would bring the state’s beer laws into the 21st century.

“Put simply, this legislation benefits consumers. It answers their call for change and for greater choices,” said Liz Murphy, a consumer advocate who writes the Naptown Pint blog. “Moreover, data has shown that Maryland-made beer keeps dollars in our communities and that Maryland craft breweries revitalize neighborhoods, create jobs and bring people together.”

An economic impact study conducted by the Bureau of Revenue Estimates found that in Maryland, the craft beer industry had an overall economic impact of $802.7 million and supported or created 6,541 jobs in 2016. The industry contributed nearly $110 million in local, state and federal revenues, which directly supports investments in education, public safety, transportation and the environment.

Still, the state is a net importer of craft beer, meaning it consumes more (275,000 barrels) than it produces (247,000 barrels). Furthermore, the National Brewers Association ranked Maryland 47th in economic impact, 36th in number of breweries and 25th in gallons produced per adult aged 21 years and over – all indications that the state’s craft beer industry has plenty of room to grow if the arbitrary restrictions currently in place are lifted.

“I’m looking forward to working with our local distributors, retailers and fellow brewers in the upcoming legislative session to pass a bill that grows the Maryland beer industry overall,” said Julie Verratti, co-founder of Denizens Brewing Company in Silver Spring. “The work of the Reform on Tap Task Force has created an opportunity to move our state forward, grow jobs and increase economic opportunity for multiple sectors. I, for one, am proud of that.”

MEDIA CONTACTS: Joe Shapiro: jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (mobile)
Alan Brody: abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

 

Franchot to Cross State for Shop Maryland for the Holidays Tour

ANNAPOLIS, Md. (November 16, 2017) - As the holiday season rapidly approaches, Comptroller Peter Franchot is encouraging Marylanders to Shop Maryland for the Holidays as he begins his 2017 statewide holiday shopping tour in Baltimore County today, November 16. 

“With one in five Marylanders directly or indirectly working in retail, the holiday shopping season is important to retailers throughout the state,” said Comptroller Franchot. “Shopping at a local business helps more than 750,000 of our neighbors and friends who make up Maryland’s retail sector.”

The retail industry contributes more than $46 billion to the state’s economy, making it the top private sector employer. according to the Maryland Retailers Association.

“The Maryland Retailers Association is thrilled to join Comptroller Franchot again on his statewide tour encouraging Marylanders to shop local for the holidays,” said Cailey Locklair Tolle, president of the Maryland Retailers Association. “Maryland retailers create jobs, give back to their communities and provide much-needed tax revenue to the state. We continue to hope Marylanders will keep these things in mind when shopping, not just for the holidays, but year-round.”

The Shop Maryland for the Holidays tour will stop in the following cities and towns in every corner of the state:

  • Hunt Valley/Timonium, November 16
  • Bethesda, November 17
  • Hyattsville, November 28
  • Berlin and Cambridge, November 29
  • St. Michaels, December 1
  • Frederick, December 5
  • Annapolis, December 6
  • Hampstead, December 7
  • Cumberland, December 14

Details about each visit will be released several days ahead of the planned stops.

“In-state shopping puts citizens’ hard-earned money back into their communities and supports local businesses that employ friends and neighbors,” said Franchot. “Shopping locally gets consumers the best product, service and experience for their dollar.”

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MEDIA CONTACTS:
Joe Shapiro: 410-260-7305 (office); 443-871-2244 (cell)
Alan Brody: 410-260-6346 (office); 443-924-1473 (cell)

IRS, Comptroller’s Office, MSATP to Discuss Protection from Tax Thieves

ANNAPOLIS, Md. (November 14, 2017) – The Internal Revenue Service’s Stakeholder Liaison – including the Maryland Comptroller’s Office – and the Maryland Society of Accounting and Tax Professionals will join in a National Tax Security Awareness Forum from 9:30 to 11:30 a.m. Tuesday, November 28 at the University of Phoenix, 8830 Stanford Boulevard, Room 128, in Columbia.

“I wholeheartedly applaud this effort to educate our tax professionals in the latest techniques to stop cyber thieves in their tracks and to prevent innocent Marylanders from becoming victims,” Comptroller Peter Franchot said. “We continue to be vigilant and resolute in our commitment to protect Marylanders’ financial information and the integrity of our tax system.”

Participants will include representatives from the IRS and Maryland Comptroller’s Office, the Better Business Bureau, the Federal Trade Commission, members of MSATP and the Small Business Administration. The event is open to new and existing small business owners, small business and industry representatives, small business service providers, tax professionals and the news media.

The discussion will center on ways to be aware of cybercriminals using phishing emails to bait victims into divulging sensitive information and W-2 scams that make steal the identity of thousands of employees and businesses. Specific topics will include:

• Data Breach and Data Security
• Don’t Take the Bait
• Identity Theft Awareness and Victim Assistance.

Visit msatp.org or call 1-800-922-9672 to register.

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MEDIA CONTACTS:
Joe Shapiro: jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (cell)

Alan Brody: abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (cell)

Comptroller Franchot Releases Findings as Reform on Tap Task Forces Wraps Up Work

ANNAPOLIS, MD (November 8, 2017) – Comptroller Peter Franchot today released his Maryland Craft Beer: A World Without Limits Report of Findings after a comprehensive look into the brewing, distribution and sales of Maryland craft beer. The report was presented at the final meeting of his Reform on Tap Task Force and after six months of presentations, discussions and fact finding trips throughout the state. The Comptroller will use his findings and the work of the Task Force to craft proposed legislation that will enable Maryland to be the nation’s number-one state for craft brewing and to allow the industry to reach its full potential here in Maryland.

“I am truly very proud of the work that this task force has done over the last several months, and the insights and perspectives from the members have been invaluable in this inclusive and collaborative process,” Comptroller Franchot said. “Since our first meeting, we have traveled across the state, and held eight public and highly-productive meetings and two public town hall meetings. We have succeeded in fulfilling our mission of conducting a top-to-bottom review of our state’s highly dysfunctional beer laws and identifying regulatory and statutory roadblocks that get in the way of the growth and success of the craft beer industry. This Report of Findings is a well-balanced analysis that charts the course for growing our craft beer industry … which, of course, directly benefits our distributors, retailers, and of course, our consumers.”

To read the Comptroller’s full Maryland Craft Beer: A World Without Limits Report of Findings, please click here.

 

MEDIA CONTACTS: Joe Shapiro: jshapiro@comp.state.md.us,

410-260-7305 (office); 443-871-2244 (cell)

 

Alan Brody: abrody@comp.state.md.us

410-260-6346 (office); 443-924-1473 (cell)

 

Comptroller Extends Certain California Alcohol Permit Expiration Dates

ANNAPOLIS, Md. (November 3, 2017) – In the wake of recent catastrophic wildfires in California that have devastated businesses of many Maryland alcohol permit holders, Comptroller Peter Franchot today announced that is he is extending the alcohol permit expiration dates for those impacted California-based companies from October 31 to December 31, 2017.

“The extensive damage caused by these wildfires is hard to comprehend and the loss of life and property is tragic,” said Comptroller Franchot. “My office stands ready to assist affected businesses to ease any burdens we can to help them get back on their feet as quickly as possible.”

Additionally, the Comptroller recognizes that wildfires have impacted Maryland Direct Wine Shipper Permit holders, who also might experience difficulty filing their third quarter Maryland Alcohol Tax Returns, which were due October 15. To support those permit holders, the Office of the Comptroller is extending this deadline until January 15, 2018 and will grant a waiver of interest and penalties for the third-quarter returns.

Affected businesses with questions about these extensions can call Patricia Anthony at 410-260-7314 or email her at panthony@comp.state.md.us.

CONTACT: Alan Brody: abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (cell)

 

State Study Confirms Value of Craft Beer Industry to Maryland Economy

BALTIMORE, Md. (October 25, 2017) – Maryland’s craft beer industry had an overall economic impact of $637.6 million and supported or created 6,541 jobs in 2016, according to an economic impact study conducted by the Bureau of Revenue Estimates that was released during today’s Reform on Tap Task Force meeting.

The study found that when the sale and distribution activity of non-Maryland craft beer is included in the projection, the estimated economic impact grew to $802.7 million. The industry contributed $53.1 million in state and local revenues and $55.3 million in federal revenues, which directly supports investments in education, public safety, transportation and the environment.

“The craft beer industry is one of our state’s most important and fastest growing economic engines. The men and women at the forefront of this dynamic industry are creating good-paying jobs, strengthening local economies and attracting tourists to communities in every corner of our state, ” said Comptroller Peter Franchot, who created the Reform on Tap Task Force in April to modernize the state’s antiquated laws governing the manufacturing, distribution and sale of Maryland craft beer.

“However, the fact that we lag so far behind our neighboring states is a reminder that we can do so much better. Flying Dog’s recent announcement that they will postpone plans to expand their brewery operations in Frederick underscore the severe consequences of a statutory and regulatory environment that impedes the growth and success of this industry. That is why it is critical that we reform, from top-to-bottom, the outdated laws that have restricted the growth of this industry for too long.”

In 2016, Maryland craft breweries directly employed 430 workers, and had an indirect and induced effect on 264 jobs – yielding a total of $28.4 million in wages and generating $143.7 million in economic output, according to the study.

Both alcohol distributors and retailers (bars and restaurants) also greatly benefited from Maryland’s craft brewers, with a direct, indirect and induced effect on almost 6,000 jobs, about $200 million in labor income and nearly $500 million in economic activity, the report found.

The analysis also indicates that Maryland’s craft beer industry has room to grow. That is demonstrated most clearly by the state’s status as a net importer of craft beer, meaning that the state consumes more craft beer (275,000 barrels) than it produces (247,000 barrels).

“This study reveals not only the substantial size of this industry in its current status, but also that, when various comparative metrics are taken into account, the industry has considerable room to grow,” said Andrew Schaufele, director of the Maryland Bureau of Revenue Estimates.

Furthermore, the National Brewers Association finds that Maryland trails other states, ranking 47th in economic impact, 36th in number of breweries and 25th in gallons produced per adult aged 21 years and over. Although production among Maryland craft brewers has steadily increased at an annual rate of 15 percent over the past five years, it has lagged behind the national average of 18 percent.

To read the full report of the Economic Impact of Maryland’s Craft Beer Industry prepared by the Maryland Bureau of Revenue Estimates, please click here.

 

MEDIA CONTACTS: Joseph Shapiro, 410-260-7305 (office), 443-871-2244 (cell)
Alan Brody, 410-260-6346 (office), 443-924-1473 (cell)

 

Gifts to Charity: Six Facts About Written Acknowledgements

ANNAPOLIS, Md. (October 19, 2018) — Throughout the year, many taxpayers contribute money or gifts to qualified organizations eligible to receive tax-deductible charitable contributions. Taxpayers who plan to claim a charitable deduction on their tax return must do two things:

• Have a bank record or written communication from a charity for any monetary contributions.
• Get a written acknowledgment from the charity for any single donation of $250 or more.

Here are six things for taxpayers to remember about these donations and written acknowledgements:
Taxpayers who make single donations of $250 or more to a charity must have one of the following:
o A separate acknowledgment from the organization for each donation of $250 or more.
o One acknowledgment from the organization listing the amount and date of each contribution of $250 or more.
The $250 threshold doesn’t mean a taxpayer adds up separate contributions of less than $250 throughout the year.
o For example, if someone gave a $25 offering to their church each week, they don’t need an acknowledgement from the church, even though their contributions for the year are more than $250.
Contributions made by payroll deduction are treated as separate contributions for each pay period.
If a taxpayer makes a payment that is partly for goods and services, their deductible contribution is the amount of the payment that is more than the value of those goods and services.
A taxpayer must get the acknowledgement on or before the earlier of these two dates:
o The date they file their return for the year in which they make the contribution.
o The due date, including extensions, for filing the return.
If the acknowledgment doesn’t show the date of the contribution, the taxpayers must also have a bank record or receipt that does show the date.

More Information:
Can I Deduct My Charitable Contributions?
Publication 526, Charitable Contributions
Tax Topic 506, Charitable Contributions
Publication 1771, Charitable Contributions Substantiation and Disclosure Requirements

Extension Filers: Deadline is Monday, Oct. 16

ANNAPOLIS, Md. (October 3, 2017) – Maryland Comptroller Peter Franchot and the Internal Revenue Service reminds taxpayers who filed for an extension and face an Oct. 16 filing deadline: The adjusted gross income (AGI) amount from their 2015 return may be needed to electronically file their 2016 tax return.

For those taxpayers who have a valid extension and are in or affected by a federally declared disaster area may be allowed more time to file. Currently, taxpayers impacted by Hurricanes Harvey, Irma and Maria as well as people in parts of Michigan and West Virginia qualify for this relief. See the disaster relief page on IRS.gov for details.

Taxpayers should keep a copy of their tax returns and supporting documents for a minimum of three years. Prior year tax returns are even more important as the IRS makes changes to protect taxpayers and authenticate their identity.

Extension filers should plan ahead if they are using a software product for the first time. They should have kept a copy of their 2015 tax return or if not, will need to order a tax transcript, a process that may take five to 10 calendar days. The AGI is clearly labeled on both the tax return and the transcript.

Taxpayers who prepare their own electronic tax returns are required to electronically sign and validate their return. Using an electronic filing PIN is no longer an option. To authenticate their identities, taxpayers also will need to enter either of two items: Their prior-year AGI or their prior-year self-select PIN and their date of birth. If married filing jointly, both taxpayers must authenticate their identities with this information.

Generally, tax-preparation software automatically generates the prior-year AGI and/or self-select PIN for returning customers. However, taxpayers who are new to a software product must enter the prior-year AGI or prior-year self-select PIN themselves.

How to find AGI; plan ahead if a mailed transcript needed

The adjusted gross income is gross income minus certain adjustments. On 2015 tax returns, the AGI is found on line 37 of Form 1040; line 21 on Form 1040A and line 4 on Form 1040EZ. Taxpayers who e-filed and did not keep a copy of their original 2015 tax return may be able to return to their prior-year software provider or tax preparer to obtain a copy.

Those who lack access to their prior-year tax returns also may go to irs.gov/transcript and use Get Transcript Online or Get Transcript by Mail. A transcript is a summary of the tax return or tax account. There are various types of transcripts, but the Tax Return Transcript works best. Look for the “Adjusted Gross Income” amount on the transcript.

Taxpayers must pass Secure Access authentication in order to access Get Transcript Online and immediately access their transcripts. Those who cannot pass Secure Access authentication should use Get Transcript by Mail or call 1-800-908-9946, and a transcript will be delivered to their home address within five to 10 calendar days.

IRS Reminder for Parents, Students: Check Out College Tax Benefits

ANNAPOLIS, Md. (September 26, 2017) ― With school now in session, the Internal Revenue Service reminds parents and students about tax benefits that can help with the expense of higher education. Two college tax credits apply to students enrolled in an eligible college, university or vocational school. Eligible students include the taxpayer, their spouse and dependents.

American Opportunity Tax Credit

• The American Opportunity Tax Credit, (AOTC) can be worth a maximum annual benefit of $2,500 per eligible student. The credit is only available for the first four years at an eligible college or vocational school for students pursuing a degree or another recognized education credential. Taxpayers can claim the AOTC for a student enrolled in the first three months of 2018 as long as they paid qualified expenses in 2017.

Lifetime Learning Credit

• The Lifetime Learning Credit, (LLC) can have a maximum benefit of up to $2,000 per tax return for both graduate and undergraduate students. Unlike the AOTC, the limit on the LLC applies to each tax return rather than to each student. The course of study must be either part of a post-secondary degree program or taken by the student to maintain or improve job skills. The credit is available for an unlimited number of tax years.

To claim the AOTC or LLC, use Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits). Additionally, if claiming the AOTC, the law requires taxpayers to include the school’s Employer Identification Number on this form.
Form 1098-T, Tuition Statement, is required to be eligible for an education benefit. Students receive this form from the school they attended. There are exceptions for some students.

Other education benefits

Other education-related tax benefits that may help parents and students are:
• Student loan interest deduction of up to $2,500 per year.
• Scholarship and fellowship grants. Generally, these are tax-free if used to pay for tuition, required enrollment fees, books and other course materials, but taxable if used for room, board, research, travel or other expenses.

• Savings bonds used to pay for college. Though income limits apply, interest is usually tax-free if bonds were purchased after 1989 by a taxpayer who, at time of purchase, was at least 24 years of age.

• Qualified tuition programs, also called 529 plans, are used by many families to prepay or save for a child’s college education. Contributions to a 529 plan are not deductible, but earnings are not subject to federal tax when used for the qualified education expenses.

To help determine eligibility for these benefits, taxpayers should use tools on the Education Credits Web page and IRS Interactive Tax Assistant tool on IRS.gov.

Keep A Copy of Tax Returns

Taxpayers should keep a copy of their tax return for at least three years. Copies of tax returns may be needed for many reasons. If applying for college financial aid, a tax transcript may be all that is needed. A tax transcript summarizes return information and includes adjusted gross income. Get one from the IRS for free.

The quickest way to get a copy of a tax transcript is to use the Get Transcript application. After verifying identity, taxpayers can view and print their transcript immediately online. The online application includes a robust identity verification process. Those who can’t pass the verification must request the transcript be mailed. This takes five to 10 days, so plan ahead and request the transcript early.