Ch. 2                                    LAWS OF MARYLAND

In item (2) of this section, the word "daily" is
substituted for the former reference to "per diem",
for clarity.

The Tax - General Article Review Committee notes, for
the consideration of the General Assembly, that an S
corporation is required to withhold 5% of the
distributive share of a nonresident. See §
10-908(b)(2) of this subtitle. However, the current
law does not specify when the withholding is to be
made. Therefore, the introductory clause of
subsection (a) of this section, "[e]xcept for an S
corporation", is added to avoid making the corporation
subject to the general rule stated in this section.
The General Assembly may wish to specify a particular
time at which an S corporation makes the withholding.

Defined terms: "Fiduciary" § 10-101
"Income tax" § 1-101 "Payor" § 10-905
"Person" §. 1-101 "Withhold" § 10-905

10-910. EXEMPTION CERTIFICATE; ALLOWABLE EXEMPTIONS.

(A)  CERTIFICATE REQUIRED.

AT THE TIME OF EMPLOYMENT, AN EMPLOYEE SHALL SIGN AND FILE
WITH THE EMPLOYER AN EXEMPTION CERTIFICATE THAT STATES THE NUMBER
OF EXEMPTIONS TO WHICH THE EMPLOYEE IS ENTITLED UNDER THIS TITLE.

(B)  ALLOWABLE EXEMPTIONS.

AN EMPLOYER SHALL BASE WITHHOLDING FOR AN EMPLOYEE:

(1)  ON THE NUMBER OF EXEMPTIONS STATED IN THE
EXEMPTION CERTIFICATE THAT THE EMPLOYEE FILES; OR

(2)  IF THE EMPLOYEE FAILS TO FILE AN EXEMPTION
CERTIFICATE OR FILES AN INVALID CERTIFICATE UNDER SUBSECTION (C)
OF THIS SECTION, ON 1 EXEMPTION.

(C)  INVALID CERTIFICATE.

(1) AN EXEMPTION CERTIFICATE IS INVALID IF IT:

(I) DOES NOT CONTAIN THE INFORMATION REQUIRED;

OR

STATES:

(II) CONTAINS FALSE OR FRAUDULENT INFORMATION.
(2) AN EXEMPTION CERTIFICATE IS NOT INVALID IF IT

(I) A NUMBER OF EXEMPTIONS THAT IS LESS THAN
THE NUMBER OF EXEMPTIONS TO WHICH THE INDIVIDUAL IS ENTITLED
UNDER § 10-211 OF THIS TITLE; OR

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