A Boutique Trusts & Estates Law Firm

A Big Wynne for Maryland Taxpayers?

Friday, June 6th, 2014

The US Supreme Court just might give you a state income tax refund next year. (Or maybe not.)

On May 27, the Supreme Court agreed to hear a case involving income tax credit that, according to the highest court in Maryland, is structured in a way the violates the US Constitution. The case, known as Comptroller v. Wynne, was brought by Brian and Karen Wynne, residents who earned income in multiple states. The Comptroller had assessed additional tax for reasons completely unrelated to this credit, and after appealing that assessment, the Wynnes added this constitutional challenge as an alternate reason why they should not have to pay.

Maryland generally taxes all income earned by a resident, even if the income was earned in another state. If that other state also taxes the same income, any tax paid to the other state counts as a credit against Maryland tax. But there’s a catch. Income tax is really two different taxes: a state-level tax and a county-level tax. This credit applies only to the state-level tax.

The Wynnes paid income tax to some other states in amounts higher than that imposed under state-level tax. Their out-of-state tax payments were thus larger than necessary to eliminate all state-level tax on that income. But the Wynnes were unable to apply any additional credit against their county-level tax. This, they said, results in a greater overall tax burden and effectively penalizes them for earning out-of-state income.

The case eventually came before the Maryland Court of Appeals, which decided that the tax credit violated the “dormant Commerce Clause” of the US Constitution. The Court relied on numerous US Supreme Court cases holding that, while states are generally free to tax their citizens, states cannot structure their tax in a way that interferes with the free flow of interstate commerce. The Court of Appeals concluded that Maryland violated this rule because the limited tax credit tends to discourage residents from earning their income via interstate commerce.

If the US Supreme Court affirms, you might be able to claim a Maryland tax refund. It may even be worthwhile to file a claim for refund now for any open years that might close before the Court decides the case (no later than June 2015).

But don’t spend your refund just yet. The fact that the Court decided to take this case could mean some of the Justices are inclined to reverse. The Court also asked for the opinion of the US Solicitor General, who advised the Court to take the case so that it could reverse the decision of the Maryland Court of Appeals.

Here is a link to more information on the scotusblog website: http://www.scotusblog.com/case-files/cases/comptroller-v-wynne/

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For Immediate Release

Contact: Jane Frankel Sims

410-828-7775

Contact: Frank Campbell

410-263-1667

Sims & Campbell Estates and Trusts

Frankel Sims Law and Holden & Campbell
Merge to Form Sims & Campbell

Firm will offer comprehensive Trusts & Estates services through offices in Towson and Annapolis

TOWSON, Md. (April 26,2019)  Frankel Sims Law and Holden & Campbell have jointly announced the merger of their firms to create a boutique Trusts & Estates law firm providing comprehensive services in the fields of Estate Planning, Estate Administration, Trust Administration and Charitable Giving. The combined firm will be named Sims & Campbell and have offices in Towson, Md. and Annapolis, Md.  Jane Frankel Sims and Frank Campbell will lead and hold equal ownership stakes in the firm.

Sims & Campbell will have 9 attorneys and 15 legal professionals that handle every facet of estate and wealth transfer planning, including wills, revocable living trusts, irrevocable trusts, estate and gift tax advice, and charitable giving strategies.  The firm will focus solely on Trusts & Estates but will serve a wide range of clients, from young families with modest resources to ultra-high net worth individuals.  This allows clients to remain with the firm as their level of wealth and the complexity of related estate and tax implications change over time. 

“By joining forces, we have expanded our footprint to conveniently serve clients in Maryland, D.C. and Virginia” said Jane Frankel Sims.  We are seeing some of the greatest wealth transfer in our country’s history, and we want to continue to be on the leading edge of helping our clients maintain and enhance their family’s wealth.  In addition, we aim to serve our clients for years to come, and the new firm structure will allow Sims & Campbell to thrive even after Frank and I have retired.”    

“Jane and I have always admired each other’s firms and recognized the need to provide even greater depth and breadth of focused expertise to help families amass and protect their wealth from generation to generation,” said Frank Campbell.  “Now we have even greater capabilities to make a real difference for our clients.” 

The Sims & Campbell Towson office is located at 500 York Road, on the corner of York Road and Pennsylvania Avenue in the heart of Towson.  The Annapolis office is currently located at 716 Melvin Avenue, and is moving to 181 Truman Parkway in August, 2019.  For more information, visit www.simscampbell.law.