Ch. 127                                      1995 LAWS OF MARYLAND

RECEIVABLES THAT ARE LOCATED WITHIN THIS STATE DURING THE TAXABLE
YEAR, AND THE DENOMINATOR OF WHICH IS THE AVERAGE VALUE OF ALL SUCH
PROPERTY LOCATED OR USED WITHIN AND WITHOUT THIS STATE DURING THE
TAXABLE YEAR.

(2) THE PROPERTY FACTOR SHALL INCLUDE ONLY PROPERTY THE
INCOME OR EXPENSES OF WHICH ARE INCLUDED (OR WOULD HAVE BEEN
INCLUDED IF NOT FULLY DEPRECIATED OR EXPENSED, OR DEPRECIATED OR
EXPENSED TO A NOMINAL AMOUNT) IN THE COMPUTATION OF THE
APPORTIONABLE INCOME BASE FOR THE TAXABLE YEAR.

(3) (I) THE VALUE OF REAL PROPERTY AND TANGIBLE PERSONAL
PROPERTY OWNED BY THE FINANCIAL INSTITUTION IS THE ORIGINAL COST OR
OTHER BASIS OF SUCH PROPERTY FOR FEDERAL INCOME TAX PURPOSES WITHOUT
REGARD TO DEPLETION, DEPRECIATION OR AMORTIZATION.

(II) LOANS ARE VALUED AT THEIR OUTSTANDING PRINCIPAL
BALANCE, WITHOUT REGARD TO ANY RESERVE FOR BAD DEBTS. IF A LOAN IS
CHARGED OFF IN WHOLE OR IN PART FOR FEDERAL INCOME TAX PURPOSES, THE
PORTION OF THE LOAN CHARGED OFF IS NOT OUTSTANDING. A SPECIFICALLY
ALLOCATED RESERVE ESTABLISHED PURSUANT TO REGULATORY OR FINANCIAL
ACCOUNTING GUIDELINES WHICH IS TREATED AS CHARGED OFF FOR FEDERAL
INCOME TAX PURPOSES SHALL BE TREATED AS CHARGED OFF FOR PURPOSES OF
THIS SUBSECTION.

(III) CREDIT CARD RECEIVABLES ARE VALUED AT THEIR
OUTSTANDING PRINCIPAL BALANCE, WITHOUT REGARD TO ANY RESERVE FOR BAD
DEBTS. IF A CREDIT CARD RECEIVABLE IS CHARGED OFF IN WHOLE OR IN PART TOR
FEDERAL INCOME TAX PURPOSES, THE PORTION OF THE RECEIVABLE CHARGED
OFF IS NOT OUTSTANDING.

(4) THE AVERAGE VALUE OF PROPERTY OWNED BY THE FINANCIAL
INSTITUTION IS COMPUTED ON AN ANNUAL BASIS BY ADDING THE VALUE OF THE
PROPERTY ON THE FIRST DAY OF THE TAXABLE YEAR AND THE VALUE ON THE
LAST DAY OF THE TAXABLE YEAR AND DIVIDING THE SUM BY TWO IF AVERAGING
ON THIS BASIS DOES NOT PROPERLY REFLECT AVERAGE VALUE, THE DEPARTMENT
MAY REQUIRE AVERAGING ON A MORE FREQUENT BASIS. THE FINANCIAL
INSTITUTION MAY ELECT TO AVERAGE ON A MORE FREQUENT BASIS. WHEN
AVERAGING ON A MORE FREQUENT BASIS IS REQUIRED BY THE DEPARTMENT OR IS
ELECTED BY THE FINANCIAL INSTITUTION, THE SAME METHOD OF VALUATION
MUST BE USED CONSISTENTLY BY THE FINANCIAL INSTITUTION WITH RESPECT TO
PROPERTY WITHIN AND WITHOUT THIS STATE AND ON ALL SUBSEQUENT RETURNS
UNLESS THE FINANCIAL INSTITUTION RECEIVES PRIOR PERMISSION FROM THE
DEPARTMENT OR THE DEPARTMENT REQUIRES A DIFFERENT METHOD OF
DETERMINING AVERAGE VALUE.

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