Martin O'Malley, Governor

Ch. 3

(A) IN THIS SECTION, "UNITARY GROUP" MEANS AN AFFILIATED GROUP
OF CORPORATIONS:                                                                                 

(1) THAT IS ENGAGED IN A UNITARY BUSINESS; AND

(2) more than 50% of the voting stock of each member of
which is directly or indirectly owned by:

(I) a common owner or common owners, either
corporate or noncorporate; or

(II) one or more member corporations of the group.

(B) whether or not the unitary group files a combined
income tax return under § 10-811 of this title, a member of a unitary
group shall compute its maryland taxable income using the
combined reporting method under this section.

(C) Under the combined reporting method, if a corporation is
a member of a unitary group and is subject to the maryland income
tax, the part of the corporation's maryland modified income that is
derived from or reasonably attributable to trade or business
carried on in the state shall be determined as follows:

(1) determine the maryland modified income of the
unitary group, by combining the corporation's income with the
income of other members of the unitary group, disregarding
transactions between members of the unitary group to accurately
reflect the income of the unitary group;

(2) determine the part of the unitary group's maryland
modified income that is derived from or reasonably attributable to
trade or business carried on in the state using a maryland
apportionment fraction of the unitary group, based on numerators
and denominators of the property, payroll, and sales factors under
§ 10-102 of this subtitle computed by combining those amounts
associated with the activities of the corporation with the activities
of other members of the unitary group, disregarding transactions
between members of the unitary group to accurately reflect the
income allocable to maryland; and

(3) for each member of the unitary group that is
subject to the maryland income tax, allocate a portion of the

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