Ch. 2

LAWS OF MARYLAND

"paying" is added to distinguish the subsidiary
foreign corporation.

In subsection (d)(2) of this section, the word
"government" is substituted for the former word
"country", for clarity.

In subsection (e) of this section, the term "gross
receipts" is substituted for the former reference to
"[o]perating revenue", for clarity.

Also in subsection (e) of this section, the defined

term "public service company franchise tax" is

substituted for the former reference to "gross

receipts taxes imposed by this article ... of public

utilities and contract carriers", for clarity and
brevity.

The Tax - General Article Review Committee notes, for
consideration by the General Assembly, that the
condition in former Art. 81, § 280A(c)(7), "[h]owever,
this exclusion shall be available only if at least 50
percent of the net taxable income of the domestic
international sales corporation is subject to Maryland
taxation", has been held to violate the Commerce
Clause of the United States Constitution in
Comptroller of the Treasury v. Armco, Inc., 70 Md.
App. 403 (1987). The condition is retained in
subsection (c) of this section for the General
Assembly's consideration.

Defined terms: "Corporation" § 10-101

"Internal Revenue Code" § 1-101

"Public service company franchise tax" § 1-101

GENERAL REVISOR'S NOTE:

Former Art. 81, §§ 280C and 280D allowed a subtraction
modification on certification of reforestation or timber stand
activity. The allowance for individuals and corporations is
revised in §§ 10-207 and 10-307 of this title, respectively.
However, the provisions of former Art. 81, §§ 280C and 280D that
related to certification by the Department of Natural Resources
now appear as NR § 5-219.

SUBTITLE 4. SPECIAL TREATMENT OF INCOME.

10-401. ALLOCATION OF INCOME -- FOR NONRESIDENT.

IN COMPUTING THE ADJUSTMENT UNDER § 10-207(O) OF THIS TITLE,
A NONRESIDENT SHALL ALLOCATE TO THE STATE INCOME DERIVED IN
CONNECTION WITH A BUSINESS, OCCUPATION, PROFESSION, OR TRADE
CARRIED ON BOTH IN AND OUT OF THE STATE BY:

(1) SEPARATE ACCOUNTING, IF THE COMPTROLLER ALLOWS;
OR

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