SPIRO T. AGNEW, Governor                        175

[(m) "Interest" means interest from whatever source derived,
and includes interest from bonds, certificates of indebtedness, evi-
dences of debt, judgments, notes, mortgages and money at interest,
and amounts received (other than amounts paid by reason of the
death of the insured) under life insurance or endowment contracts,
either during the term or at maturity or upon the surrender of the
contract, in excess of the total amount of the premiums paid there-
for.]

[(n) "Investment income" means that portion of the gross
income which is derived from dividends, ground rents, annuity in-
come and interest, but shall not include interest earned in the con-
duct of a business on (1) loans made under the provisions of Article
58A of the Annotated Code of Maryland, (2) business accounts and
notes receivable, or (3) installment contracts; nor shall it include
the proceeds of a pension or other deferred compensation plan set
up by an employer for an employee, although a portion of such
proceeds be otherwise taxable as proceeds of an annuity.]

[(o) "Ordinary income" means that portion of the gross income
which is not investment income.]

(j) [(p)] The term "this State" includes all territory owned
by or ceded to the United States of America within the territorial
limits or confines of the State of Maryland.

(k) [(q)] "Employer" means any person, firm or corporation,
including the federal government, the District of Columbia (to the
extent that functions of the District government are carried on or
performed in Maryland), the State of Maryland and any county,
municipal corporation or political subdivision or instrumentality of
this State, employing or utilizing the services of one or more in-
dividuals for hire, remuneration or compensation of any kind.

(l) [(r)] The terms "domestic and foreign" when used
herein and applied to corporate entities shall mean in the case of
"domestic, a corporation organized and existing under the laws of
Maryland and in the case of "foreign" shall mean a corporation
organized and existing under the laws of other states and govern-
ments.

[(s) "Accident and health welfare fund or plan" shall mean a
fund or plan established, maintained and operated for the purpose
of providing group benefits to employees and their beneficiaries in
the event of sickness, accident or death and into which fund or
plan one or more employers contribute all or part of the require-
ments of such fund or plan but shall not include a corporation or
organization wholly owned or controlled by such fund or plan and
conducting an activity for the production of income which is other-
wise taxable under this subtitle.]

280.

(a)    The taxable net income of a AN INDIVIDUAL taxpayer of
this State shall be that taxpayer's federal adjusted gross income as
defined in the laws of the United States with the modifications and less
the deduction DEDUCTIONS and personal exemptions provided in
this subtitle.

(b)    There shall be added to federal adjusted gross income: (1)
interest or dividends on obligations or securities of any state or