ROBERT L. EHRLICH, JR., Governor                             Ch. 203

10-910.

(b) (1) [An] EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS SUBSECTION,
AN employer shall base withholding for an employee:

[(1)] (I) on the number of exemptions stated in the exemption certificate
that the employee files; or

[(2)] (II) if the employee fails to file an exemption certificate or files an
invalid certificate under subsection (c) of this section, on 1 exemption.

(2) IF THE COMPTROLLER NOTIFIES AN EMPLOYER THAT AN EMPLOYEE
HAS AN UNPAID TAX LIABILITY, THE EMPLOYER SHALL BASE WITHHOLDING FOR
THE EMPLOYEE ON A NUMBER OF EXEMPTIONS NOT EXCEEDING THE ACTUAL
NUMBER OF EXEMPTIONS ALLOWED ON THE EMPLOYEE'S PRIOR YEAR'S INCOME
TAX RETURN, AS SPECIFIED BY THE COMPTROLLER

10-912.

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

(2) "NET PROCEEDS" MEANS THE TOTAL SALES PRICE PAID TO THE
TRANSFEROR LESS:

(I) DEBTS OF THE TRANSFEROR SECURED BY A MORTGAGE OR
OTHER LIEN ON THE PROPERTY BEING TRANSFERRED THAT ARE BEING PAID UPON
THE SALE OR EXCHANGE OF THE PROPERTY; AND

(II) OTHER EXPENSES OF THE TRANSFEROR ARISING OUT OF THE
SALE OR EXCHANGE OF THE PROPERTY AND DISCLOSED ON A SETTLEMENT
STATEMENT PREPARED IN CONNECTION WITH THE SALE OR EXCHANGE OF THE
PROPERTY.

(3) "NONRESIDENT ENTITY' MEANS AN ENTITY THAT:

(I) IS NOT FORMED UNDER THE LAWS OF THE STATE; AND

(II) IS NOT QUALIFIED BY OR REGISTERED WITH THE
DEPARTMENT OF ASSESSMENTS AND TAXATION TO DO BUSINESS IN THE STATE.

(4) "RESIDENT ENTITY' MEANS AN ENTITY THAT:

(I) IS FORMED UNDER THE LAWS OF THE STATE; OR

(II) IS FORMED UNDER THE LAWS OF ANOTHER STATE AND IS
QUALIFIED BY OR REGISTERED WITH THE DEPARTMENT OF ASSESSMENTS AND
TAXATION TO DO BUSINESS IN THE STATE.

(5) "TOTAL PAYMENT' MEANS THE NET PROCEEDS OF A SALE ACTUALLY
PAID TO A TRANSFEROR INCLUDING THE FAIR MARKET VALUE OF ANY PROPERTY
TRANSFERRED TO THE TRANSFEROR.

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