One Month After Open Enrollment, Maryland Still Has $2 Million in Cyber Tax Credits to Award
February 20, 2014
As we previously highlighted, a key advantage of doing business in Maryland are the tax credits that incentivize many security companies and government contractors that call the state their home.
One of these tax credits is the Employer Security Clearance Costs (ESCC) credit, which includes provisions for security clearance administrative expenses, Sensitive Compartmented Information Facility (SCIF) costs, and first-year leasing costs for small businesses.
When enrollment opened for these cyber security tax credits last month, the Maryland Department of Business and Economic Development expected more than 50 qualified cyber security companies to apply for it.
Fast-forward one month and there are still $2 million of cyber security investment tax credits available for local companies.
The Maryland Department of Business and Economic Development believes that companies have been slow to enroll because it is a new tax credit, and there weren’t many educational programs leading up to the launch. Also, the popular biotech tax credit in 2007 did not fully take hold until 2009.
In addition, there was plenty of press coverage in the Baltimore Business Journal about how companies interested in applying for the tax credit found the enrollment application to be confusing because “it was drafted in the language of state legislators and not in the terms of business people.”
One other key motivating item to note is that Governor Martin O’Malley has proposed an increase of the tax credit to $4 million for next fiscal year – meaning that an additional $1 million will be available when compared to 2013.
This is where the SC&H’s State & Local Tax Practice can help interested companies manage the process with clarity and optimal outcomes. This is a major opportunity for any emerging cyber security company to embrace key tax benefits that can boost your business growth. Don’t miss out!