1664                                       LAWS OF MARYLAND                                    Ch. 594

the course of their employment as policemen or firemen; (3)
for all taxable years ending after December 31, 1972,
amounts received by an individual who has attained the age
of 65 years before the close of the taxable year as an
annuity, pension, or endowment under a private, municipal,
State or federal employee retirement system, and included in
such individual's federal adjusted gross income, this
subtraction shall not exceed an amount equal to the maximum
annual benefits permitted for persons who retired at the age
of 65 or older under the Social Security Act for the prior
calendar year. The Comptroller shall determine the amount
of the maximum benefit annually and for the purposes of this
subparagraph may allow the subtraction to the nearest $100.
The allowed subtraction shall be reduced by the amount of
old age, survivors, or disability benefits received under
the Social Security Act, the Railroad Retirement Act, or
both, as the case may be; (4) in the case of persons retired
prior to January 1, 1967, payments received which represent
[uncovered] UNRECOVERED contributions to a retirement system
over and above any amount of such contributions remaining to
be recovered tax free on the federal return, limited to an
amount which together with the amount of any tax—free
exclusion in the federal return does not exceed the
exclusion which was permitted under the laws and regulations
of this State prior to the year 1967; (5) FOR ALL TAXABLE
YEARS BEGINNING AFTER DECEMBER 31, 1978, ANY INCOME REPORTED
ON THE INDIVIDUAL'S FEDERAL INCOME TAX RETURN DUE TO A
WITHDRAWAL OR WITHDRAWALS FROM A RETIREMENT PLAN ESTABLISHED
UNDER THE SELF-EMPLOYED INDIVIDUALS TAX RETIREMENT ACT OF
1962, PUBLIC LAW 87-792, AS AMENDED, POPULARLY KNOWN AS A
KEOUGH PLAN, TO THE EXTENT THAT THE WITHDRAWAL OR
WITHDRAWALS CONSIST OF FUNDS ON WHICH STATE INCOME TAXES
WERE PAID UNDER THE APPLICABLE STATE LAW AT THE TIME THE
FUNDS WERE CONTRIBUTED TO THE PLAN, OR OF INTEREST OR
DIVIDENDS ON WHICH STATE INCOME TAXES WERE PAID UNDER THE
APPLICABLE STATE LAW AT THE TIME THE INTEREST OR DIVIDENDS
ACCUMULATED IN THE PLAN; [(5)] (6) to the extent included,
the amount of any refunds of income taxes paid to the State
of Maryland, any other state, the District of Columbia, and
any political subdivision of the State of Maryland and of
any other state; [(6)1(7) to the extent included,
distributions to beneficiaries of accumulated income on
which income tax has been paid by a fiduciary to this State;
[(7)](8) expenses for household and dependent care services
determined and calculated as employment—related expenses
under Section 44A of the Internal Revenue Code, as amended
from time to time, and subject to the dollar limit imposed
by that section; and [ (8) 1(9) for all taxable years ending
after December 31, 1972, amounts received by an individual
who is totally disabled, as an annuity, pension or endowment
under a private, municipal, State or federal retirement
system, and included in such individual's federal adjusted
gross income, this subtraction shall not exceed an amount
equal to the maximum annual benefit received in Maryland by
persons who retired at the age of 65 or older under the
Social Security Act for the prior calendar year. The
Comptroller shall determine the amount of the maximum