Maryland Tax Debt Collection Procedures Checklist
When you receive a notice from the Comptroller of Maryland regarding unpaid tax debt, the notice indicates the state has not received payment for taxes you owe, and collection actions may follow. Maryland law authorizes the Comptroller to use various collection tools to recover unpaid taxes, including wage liens, bank levies, tax liens, and refund offsets.
What Collection Notices Mean
Collection notices from the Comptroller of Maryland tell you that the state has determined you owe unpaid taxes and has not received payment after earlier billing attempts. These notices represent a progression in the collection process that typically begins with initial bills and moves toward enforcement if payment or arrangements are not made.
Why the Comptroller Sends Collection Notices
The Comptroller of Maryland sends collection notices when a taxpayer has an unpaid tax debt that remains outstanding after initial billing. Maryland’s collection division reviews unpaid accounts regularly and pursues collection through increasingly serious measures when taxpayers do not pay or contact the office to arrange payment.
What Happens If You Ignore Collection Notices
Failing to respond to collection notices from the Comptroller means the office will pursue payment using enforcement methods available under Maryland law. The Comptroller’s Office regularly levies bank accounts and issues wage liens under Tax-General Code Section 13-811.
Additional enforcement actions include filing notices of tax lien in circuit court, intercepting state and federal tax refunds, preventing renewal of state business and professional licenses, and intercepting vendor payments if you do business with the state or federal government.
What Collection Notices Do Not Mean
Collection notices do not mean you are being arrested or facing criminal charges. Tax collection actions are civil enforcement procedures, not criminal penalties, and the Comptroller’s Office remains willing to discuss payment plans and settlement options even after sending collection notices.
Understanding Maryland’s Collection Time Limits
Maryland Tax-General Code Section 13-1103 establishes that taxes imposed under the Tax-General article may not be collected after seven years from the date the tax is due. Exceptions exist when judgments are entered within the seven-year period, as these judgments may be enforced or renewed like any other court judgment under Maryland law.
Checklist: What to Do After Receiving a Collection Notice
Step 1: Read the notice completely
Locate the notice you received from the Comptroller of Maryland and read it thoroughly. Write down the following information:
● Write down your name and address as they appear on the notice.
● Note the tax year or period the debt relates to.
● Record the total amount owed.
● Copy the notice number and date.
● Save the contact information for the Comptroller’s collections section.
● Mark any response deadline mentioned on the notice.
Step 2: Verify the debt is accurate
Review the tax year or period listed on the notice and confirm whether you filed a return for that year. Gather any tax documents you have from the year in question, including your original tax return, payment records, and any previous correspondence from the Comptroller about this debt.
Step 3: Contact the Comptroller’s collections section
Call the appropriate collections department based on your tax type. For individual income tax liabilities, contact the individual collections department at 410-974-2432 or 1-888-674-0016, or email cdcollectionind@marylandtaxes.gov.
Business tax liabilities require contacting the business collections department at 410-649-0633 or 1-888-614-6337, or emailing cdcollectionbizz@marylandtaxes.gov. Have your notice in front of you when you call and be ready to provide your name, social security number or tax identification number, and the notice number.
Step 4: Ask about payment options
Inquire about payment plans and settlement options available through the Comptroller’s Office. Maryland allows taxpayers to set up installment agreements for unpaid taxes in many cases, and the offer in compromise program may be available if you cannot afford to pay the full amount.
Step 5: Understand appeal rights if you disagree
If you received a notice of assessment and you disagree with the tax amount, you can file an appeal within 30 days of the notice date. Appeals must be filed online through the Comptroller’s website or by mail to the Hearings and Appeals Division, and timely appeals prevent collection actions during the hearing process.
Step 6: Respond to private collection agencies if contacted
If a private collection agency contacts you about Maryland tax debt, understand that you still owe the debt to the Comptroller of Maryland. Verify the agency’s legitimacy by contacting the Comptroller’s collections section directly using the phone numbers provided above.
Step 7: Document all communications
Keep records of every contact about your tax debt, including the date, the person you spoke with, what was discussed, and any commitments made. Save copies of emails, letters, and payment confirmations to protect yourself if questions arise later.
Step 8: Take action based on your situation
Pay in full if possible and request written confirmation that the debt is satisfied. Set up a payment plan if you cannot pay immediately but can make monthly payments, file an appeal if you disagree with the assessment and are within the 30-day period, or contact a tax attorney if you need professional guidance.
Common Mistakes to Avoid
● Ignoring collection notices from the Comptroller and hoping the debt will disappear on its own leads to enforcement actions.
● Failing to contact the Comptroller’s collections section before enforcement actions begin eliminates opportunities to arrange payment plans.
● Missing the 30-day appeal deadline when you disagree with a tax assessment prevents you from challenging the amount owed.
● Paying a private collection agency without verifying that they are authorized to collect Maryland tax debt can result in fraudulent payments.
● Not keeping records of all communications and payments related to your tax debt leaves you without protection if disputes arise later.
Frequently Asked Questions
How long can the Comptroller collect my tax debt?
Maryland Tax-General Code Section 13-1103 establishes a seven-year statute of limitations for collecting most taxes. The Comptroller may not collect taxes after seven years from the date the tax is due, with exceptions for judgments entered within that period.
What collection actions can the Comptroller take?
The Comptroller’s Office can levy bank accounts, issue wage liens, file tax liens in circuit court, intercept state and federal refunds, and prevent renewal of business and professional licenses. These actions are authorized under Maryland’s Tax-General Code and do not require court approval before the Comptroller takes them.
Can I set up a payment plan?
Contact the Comptroller’s collections section to discuss installment agreements. Maryland allows payment plans for unpaid taxes in many cases, and the collections staff will review your financial situation to establish monthly payments you can afford.
What if a private agency contacts me about Maryland taxes?
You still owe the debt to the Comptroller of Maryland even if a private agency contacts you. Verify the agency’s legitimacy by calling the Comptroller’s collections section directly, as private agencies act as collection agents on behalf of the state but do not become the creditor.
Collection notices from the Comptroller of Maryland require prompt attention because they represent active collection efforts that can lead to enforcement actions if unaddressed. Taking action by gathering your documents, verifying the debt, and communicating with the collections department gives you the best opportunity to resolve the matter on terms that work for your situation.
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance
