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Ch. 494 2000 LAWS OF MARYLAND
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(2) The EXCEPT AS PROVIDED IN PARAGRAPH (3) OF THIS SUBSECTION,
THE subtraction under subsection (a) of this section includes any amount included in
federal adjusted gross income as a result of a benefit furnished DISTRIBUTION to;
(I) a QUALIFIED beneficiary pursuant to a [higher education
investment] PREPAID contract under the Maryland [Higher Education Investment
Program] PREPAID COLLEGE TRUST; OR
(II) A QUALIFIED DESIGNATED BENEFICIARY FROM AN
INVESTMENT ACCOUNT UNDER THE MARYLAND COLLEGE INVESTMENT PLAN.
(3) The subtraction under paragraph (2) of this subsection does not apply
to:
(I) a refund under the Maryland [Higher Education Investment
Program] PREPAID COLLEGE TRUST unless the refund is applied on behalf of the
beneficiary to the cost of tuition at an institution of higher education OR THE
MARYLAND COLLEGE INVESTMENT PLAN; OR
(II) A DISTRIBUTION THAT IS NOT USED BY THE QUALIFIED
BENEFICIARY OR QUALIFIED DESIGNATED BENEFICIARY FOR QUALIFIED HIGHER
EDUCATION EXPENSES.
10-208.
(a) In addition to the modification under § 10-207 of this subtitle, the
amounts under this section are subtracted from the federal adjusted gross income of
a resident to determine Maryland adjusted gross income.
(n) (1) (I) IN THIS SUBSECTION THE FOLLOWING WORDS HAVE THE
MEANINGS INDICATED.
(II) "PURCHASER" HAS THE MEANING STATED IN § 18-1901 OF THE
EDUCATION ARTICLE.
(III) "QUALIFIED HIGHER EDUCATION EXPENSES" HAS THE
MEANING STATED IN § 529 OF THE INTERNAL REVENUE CODE.
(2) The subtraction under subsection (a) of this section includes the
amount of advance payments of undergraduate tuition QUALIFIED HIGHER
EDUCATION EXPENSES made by an individual A PURCHASER during the taxable year
as provided under a [higher education investment] PREPAID contract in accordance
with the Maryland [Higher Education Investment Program] PREPAID COLLEGE
TRUST.
(2) (3) Subject to paragraph (3) (4) of this subsection, for each [higher
education investment] PREPAID contract, the subtraction under paragraph (1) (2) of
this subsection may not exceed $2,500 for any taxable year.
(3) (4) The amount disallowed as a subtraction under this subsection
for any taxable year as a result of the limitation under paragraph (3) (3) of this
subsection shall be treated as having been made in the next succeeding taxable year
and, subject to the $2,500 annual limitation for each [higher education investment]
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