percentage specified in subparagraph (ii) of this paragraph of the earned income
credit allowable under § 32 of the Internal Revenue Code exceeds the State income
tax for the taxable year.

(ii) The applicable percentage of the earned income credit allowable
under § 32 of the Internal Revenue Code to be used for purposes of determining the
refund provided under this paragraph is:

1. 10% for a taxable year beginning after December 31, 1997
but before January 1, 2000;

2. 12.5% for a taxable year beginning after December 31,
1999 but before January 1, 2001; and

3. 15% for a taxable year beginning after December 31, 2000.

(C) SUBJECT TO SUBSECTION (D) OF THIS SECTION, THE CREDIT ALLOWED
AGAINST THE COUNTY INCOME TAX UNDER SUBSECTION(A)(2) OF THIS SECTION IS
THE LESSER OF:

(1) THE EARNED INCOME CREDIT ALLOWABLE FOR THE TAXABLE YEAR
UNDER § 32 OF THE INTERNAL REVENUE CODE MULTIPLIED BY 10 TIMES THE
COUNTY INCOME TAX RATE FOR THE TAXABLE YEAR; OR

(2) THE COUNTY INCOME TAX FOR THE TAXABLE YEAR

[(c)] (D) For an individual who is a nonresident or is a resident of the State for
only a part of the year, the amount of the credit or refund allowed under this section
shall be determined based on the part of the earned income credit allowable for the
taxable year under § 32 of the Internal Revenue Code that is attributable to
Maryland, determined by multiplying the federal earned income credit by a fraction:

(1) the numerator of which is the Maryland adjusted gross income of the
individual; and

(2) the denominator of which is the federal adjusted gross income of the

individual.
10-706.

(a) Except as otherwise provided in this section[:

(1) ], a credit allowed under this subtitle is allowed against the State
income tax only[; and

(2) the county income tax is based on the State income tax before the
State income tax is reduced by the credit],

(b) [(1)] A credit under § 10-701 of this subtitle is allowed against the total
county and State income taxes.

[(2) The county income tax is based on the amount of State income tax
before the State income tax is reduced by the credit.]