Key takeaways
- File sales and use tax returns and payments in Maryland Tax Connect. Use bFile only to view earlier submissions.
- The timely discount is 1.2% of tax up to $6,000, and 0.9% of tax plus $18.00 above $6,000, capped at $500 per return.
- A quarterly return for October through December 2026 cannot be filed before December 1, 2026.
- Record the exemption certificate serial number on the record of every tax-exempt sale.
Use Maryland Tax Connect, not bFile or iFile
The Comptroller’s bFile login page says that all Sales and Use Tax returns and payments will need to be filed at the new “Maryland Tax Connect Portal”. The Comptroller’s home page says that as of September 1, 2026, all tax processing systems have moved to Maryland Tax Connect, and it describes Maryland Tax Connect as the replacement for iFile for individuals.
bFile still holds earlier submissions. The bFile page says previously submitted returns and payments are available for view only, and that the Sales and Use Tax Print and Mail option was decommissioned as of January 22, 2024. When a client asks for an earlier return, pull the view-only copy from bFile before rebuilding the figures from the books.
Monthly and quarterly filing periods
The Comptroller assigns each account a filing frequency, and the account shows it. The Comptroller pages do not state the rules that assign a frequency, so do not infer it from sales volume. Read the frequency the account shows and record it in the client file before the first return of the year.
A monthly period ends on the last day of the month. A quarterly period ends on the last day of the quarter, and the Comptroller’s help says the report is processed to include the entire quarter. A quarterly filing is not accepted before the first day of the last month of the quarter, so the January through March quarter opens March 1.
Worked example: the October through December 2026 quarter ends December 31, so the quarterly return cannot be filed before December 1, 2026. The October 2026 monthly period has already ended and can be filed now. Put December 1 on the client calendar so the portal rejection is not a surprise.
Due dates follow the period ending date, and a due date that falls on a Saturday, Sunday or holiday moves to the next business day. The Comptroller pages reviewed here do not name the day of the month. Use the due date the portal shows on the return, not one copied from a calendar.
The 6% rate and the other rates
Taxable sales are taxed at 6%. The return takes sales subject to the 6% rate as one amount, and tax is that amount times 6%. Illustrative arithmetic: $48,000 of taxable sales in a month produces $2,880 of tax before any discount.
Some items sit on other rates. The bFile help lists 9% for alcoholic beverages and 12% for electronic smoking devices and tobacco pipes. Check the product type before a sale goes onto the 6% line, because a client that sells alcoholic beverages alongside general merchandise needs separate amounts.
The timely filing discount, worked through
The discount applies when the return is timely and the amount due is paid in full. The Comptroller’s help gives the formula in two parts. If the tax is $6,000 or less, the discount is 1.2% of the tax. If the tax is greater than $6,000, the discount is 0.9% of the tax plus $18.00.
Example one: tax of $2,880 gives a discount of $34.56. Example two: tax of $10,000 gives a discount of $108.00, which is 0.9% of $10,000 plus $18.00.
The discount may not exceed $500 for each return. Under the 0.9% formula, the cap starts to bind once the tax passes about $53,556. A vendor that files a consolidated return gets a maximum of $500 across all of its returns, not $500 for each one.
A partial payment on time does not earn the discount on that return. A client who cannot pay in full should still file on time, pay what it can and accept that the discount is gone.
Late returns lose the discount and add a penalty
A discount cannot be taken if the return is filed and paid after the due date. If a return with payment for taxes due is not filed by its due date, the filer must include a penalty of 10% of the tax due plus interest. Interest runs per month or fraction of a month, and the help text does not give the rate, so check the current rate before you quote one.
Example: tax of $2,880 filed 15 days late carries a $288 penalty plus interest, and the $34.56 discount is gone. The late payment costs $322.56 more than the on-time payment before interest.
The portal defaults the payment date to the due date, and you may enter an earlier date that is not before today, but not a later one. The Comptroller’s help says that on a late return the payment date will be the current date. A payment date on screen therefore does not show that a return was timely, so compare the filing date to the due date yourself.
Exempt sales: what goes on the return and what goes in the file
Line 3, gross sales, covers all taxable and non-taxable sales and rentals of tangible personal property and taxable services. Do not include tax collected in that figure, and enter whole dollars only. An exempt sale stays in gross sales but is left out of the taxable amount, so it carries no tax.
Illustrative example: a wholesaler has $60,000 of gross sales in a month, and $15,000 of that went to a buyer that gave a resale certificate. The taxable amount is $45,000, and the tax at 6% is $2,700. Gross sales stay at $60,000.
COMAR 03.06.01.22 requires the vendor to record the valid serial number of the exemption certificate on any record or evidence of each sale. Put the serial number on the invoice or point-of-sale record for that sale. A number kept in a folder that nobody can link back to the sale does not meet the rule.
Under the same regulation, a religious institution’s exemption certificate number can stand in for a sales and use tax license number on a resale certificate. Other private exempt entities cannot do that, and must register as vendors and use their sales and use tax license number.
Collect the certificate before the sale
Ask for the certificate before you invoice without tax, not at filing time. A workable request is: “Before we can invoice this order without Maryland sales tax, please send your Maryland resale or exemption certificate, including its number.” Enter the number on the invoice when it arrives.
COMAR 03.06.01.22 says that unless the exemption certificate is exhibited at the time of sale, the applicable tax shall be charged by the vendor. A customer with no certificate at the time of sale is therefore charged tax, and that sale is not reported as exempt. The regulation does not say whether a certificate obtained after the sale changes that, so get a written answer from the Comptroller before reclassifying any sale.
The same section says a vendor may not exempt any sale on the basis of an expired certificate. Check the expiration date when the certificate arrives, and record it with the serial number.
Failure modes and fixes
A discount claimed after a partial payment does not meet the rule, which requires the amount due to be paid in full. Fix: pay the full amount on or before the due date, or tell the client the discount is gone before filing.
A quarterly return started in October for the October through December quarter cannot be filed until December 1. Fix: keep the figures in the workpapers until then.
A late return with the payment date entered as the due date looks timely on screen but is not. Fix: enter the actual payment date, and compare the filing date to the due date before claiming the discount.
A resale sale with no certificate serial in the record cannot be documented as exempt, because the regulation requires the serial number on any record or evidence of each sale. Fix: re-check the sales records before filing, and charge tax on any sale with no certificate exhibited at the time of sale.