MARVIN MANDEL, Governor

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Article 81 — Revenue and Taxes

Section 280(b) and (c)

Annotated Code of Maryland

(1975 Replacement Volume and 1975 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That Section 280(b) and (c) of Article 81 -
Revenue and Taxes, of the Annotated Code of Maryland
(1975 Replacement Volume and 1975 Supplement) be and they
are hereby repealed and reenacted, with amendments, to
read as follows:

Article 81 — Revenue and Taxes

280.

(b)    There shall be added to federal adjusted gross
income: (1) interest or dividends, (less related
expenses), on obligations or securities of any state or
of a political subdivision or authority thereof (other
than this State and its political subdivisions and
authorities); (2) salaries and wages and interest or
dividends on obligations of any authority, commission,
instrumentality, territory or possession of the United
States or of any foreign government, which by the laws or
treaties of the United States are exempt from federal
income tax but not from State income taxes; (3) dividends
received by individuals excluded from federal adjusted
gross income pursuant to § 116 of the Internal Revenue
Code; [(4) distributions of corporate prior years'
earnings not previously taxed in Maryland to individuals
and current year losses of corporations claimed for the
taxable year by individuals, resulting from an election
of a small business corporation, as defined by § 1371 of
the Internal Revenue Code as amended from time to time,
to be taxed in accordance with the provisions of
subchapter "S" of the Internal Revenue Code; and (5)] AND
(4) for all taxable years beginning after December 31,
1974, 50 percent of the sum of the items of tax
preference as determined under the provisions of § 280B
of this subtitle.

(c)    There shall be subtracted from federal
adjusted gross income: (1) interest or dividends on
obligations of the United States and its territories and
possessions or of any authority, commission or
instrumentality of the United States and any other income
to the extent includable in gross income for federal
income tax purposes, but exempt from State income taxes
under the laws of the United States; (2) [to the extent
included, undistributed corporate income attributed to
individuals from small business corporations, as defined
by Section 1371 of the Internal Revenue Code, as amended
from time to time, which elected to be taxed in
accordance with the provisions of subchapter "S" of the
Internal Revenue Code; (3)] payments received by
policemen and firemen from pension systems for injuries