PARRIS N. GLENDENING, Governor                          H.B. 1154

(2) If in any taxable year a corporation is permitted or required to use the
separate accounting method in determining all or a portion of its Maryland taxable
income, the portion that is separately accounted for to Maryland shall be taxable whether
or not the Maryland modified income of the corporation for the taxable year is zero or

less.

(c) (1) [If] EXCEPT AS PROVIDED IN SUBSECTION (D) OF THIS SECTION, IF
the trade or business is a unitary business, the part of the corporation's Maryland
modified income derived from or reasonably attributable to trade or business carried on
in the State shall be determined using a 3 factor apportionment fraction:

(i) the numerator of which is the sum of the property factor, the
payroll factor, and twice the sales factor; and

(ii) the denominator of which is 4.

(2) The property factor under paragraph (1) of this subsection shall include:

(i) rented and owned real property; and

(ii) tangible personal property located in the State and used in the
trade or business.

(D) A COMMERCIAL BANK, SAVINGS BANK, TRUST COMPANY, OR COMPANY
THAT SUBSTANTIALLY COMPETES WITH NATIONAL BANKS IN THE STATE SHALL
ALLOCATE MARYLAND MODIFIED INCOME DERIVED FROM OR REASONABLY
ATTRIBUTABLE TO ITS TRADE OR BUSINESS IN THIS STATE IN ACCORDANCE WITH §
10-403 OF THIS SUBTITLE.

[(d)](E) To reflect clearly the income allocable to Maryland, the Comptroller
may alter, if circumstances warrant, the methods under subsections (b) and (c) of this
section, including:

(1)    the use of the separate accounting method;

(2)    the use of the 3 factor double weighted sales factor formula method;

(3)    the weight of any factor in the 3 factor formula;

(4)    the valuation of rented property included in the property factor; and

(5) the determination of the extent to which tangible personal property is
located in the State.

10-403.

(A) (1) IN THIS SECTION THE FOLLOWING WORDS HAVE THE MEANINGS
INDICATED;

(2) "BANK OR TRUST COMPANY" MEANS:

(I) A COMMERCIAL BANK;

(II) A SAVINGS BANK;

- 4319 -