How to Contest the Penalty Fees for a Basic Business License in Maryland

Penalty fees can hurt a business' bottom line.

The State of Maryland levies late charges and penalty fees to business owners who fail to pay their taxes on time. Type of business taxes that this applies to include income, sales and use tax, and taxes that are required to be withheld by an employer. Maryland has several avenues in place by which a business can appeal penalty fees or request to have the fees reduced or eliminated.

Instructions

1. Make sure you understand all of the charges, late fees and penalties the state assessed by thoroughly reviewing the Statement of Account provided to you by the Maryland Comptroller's office.

2. Make a list of the reasons that you are contesting the penalty fees. For example, you believe the state charged fees in error, you paid your taxes on time, or you do not have the resources to pay for the fees at the current time.

3. Call the Comptroller's office and let them know that you wish to contest the assessed penalty fees. Clearly state the reasons why you believe the state should waive the penalty fees -- using your list as a reference -- or why you are requesting the fee waiver.

If the Comptroller Initially Rejects Your Request

1. Call the Comptroller's Ombudsman at [phone] and let him know that you would like assistance in resolving your situation. Clearly and professionally detail your situation and explain that you would like to know how you may have your penalty fees waived.

2. If the ombudsman is also not able to assist, go to the Maryland Comptroller's Website and visit the Offer in Compromise Tax Liability Resolution Program Web page.

3. Click on the "Business Tax Tip #58-Offer in Compromise" link. Review the full details of the Offer in Compromise Tax Liability Resolution program to see if you qualify for the program.

4. Click on the link for Form MD 656, located on the Business Tax Tip #58 Web page. Print, complete and sign form MD 656. This is the official request to apply for an Offer in Compromise.

5. Click on the link for Form 433-B, located on the Tax Tip #58 Web page. Print, complete and sign MD Form 433-B. This is the Collection Information Statement for Business.

6. Mail all completed and required forms to:

   Offer in Compromise Program

   Comptroller of Maryland

   301 West Preston Street, Rm. 203

   Baltimore, Maryland 21201

Tips & Warnings

• You may be required to sumbit a financial statement detailing your financial situation when applying for the Offer in Compromise program.

References

• Comptroller of Maryland: Ombudsman
• Comptroller of Maryland: Business Tip #58 Tax Liability Resolution Program
• Justia: Maryland State Finance and Procurement Section 6-219