What happens if I do not set up a payment plan with the Comptroller?

The Comptroller says that a taxpayer who cannot pay in full must contact its individual income tax collections section for a payment plan, and that if no plan is set up or the payments are not made, it may take legal action, including filing a notice of tax lien in court or attaching bank accounts or wages. It also says the account may be referred to a private collections agency.

Does a Maryland offer in compromise application stop collection?

No. The Comptroller's Offer in Compromise Program says that receipt of an application does not create a collections hold, and that collection actions, including MVA and professional license holds, the filing of a notice of tax lien, and referral to a collection agency, continue while the application is reviewed. The application is Form MD 656 with Form MD 433-A, and the program requires, among other things, that two years have passed since the taxpayer became liable for the tax.

Can the Comptroller take my federal tax refund?

Yes. The Comptroller says it can intercept a federal income tax refund and payments due to a taxpayer as a federal vendor, and that it will apply all or part of any money the State owes the taxpayer, including a Maryland income tax refund, to the unpaid liability even if a payment plan has been set up.

How long does a Maryland tax lien last?

Under Tax-General section 13-806, a lien generally arises on the date of notice that the tax is due and continues until it is satisfied, until the Comptroller releases it as unenforceable by lapse of time or uncollectible, or until 20 years after the date of assessment, whichever comes first. Separately, section 13-1103 generally bars collecting an assessed tax more than 10 years after the date of assessment, but provides that a judgment entered may be enforced or renewed as any other judgment. How those periods apply to a particular balance depends on the facts, so do not assume a balance has expired after 10 years.

Maryland tax collection

Comptroller of Maryland collections and tax liens.

Maryland law makes unpaid Maryland tax, interest, and penalties a lien in favor of the State on all property and rights to property of the person required to pay. Once the Comptroller of Maryland files a notice of tax lien in a circuit court, the lien has the full force and effect of a judgment lien, and the Comptroller's publications say that when a balance goes unpaid it may also attach bank accounts or wages, intercept refunds, and hold licenses.

Mr. Powell represents individuals and closely held businesses in Comptroller of Maryland collection matters, including payment plans, offers in compromise, and lien and levy problems, from 1629 K Street NW, Suite 300 in Washington, DC.

Maryland Tax-General sections 13-804 to 13-812 and 13-1103, the Comptroller's Tax Tip #36 (revised April 3, 2023), Business Tax Tip #10 (updated September 24, 2021), and its Offer in Compromise Program FAQs (revised June 9, 2025) were checked on mgaleg.maryland.gov and marylandcomptroller.gov on October 6, 2026. Phone numbers are the ones those publications listed on that date. This page covers Maryland state tax; federal IRS collection is separate.

Start here Call (202) 821-1980

How the State's lien works.

Tax-General section 13-805 makes unpaid tax, interest, and penalties a lien in favor of the State on all property and rights to property of the person required to pay the tax. Under section 13-806, the lien generally arises on the date of notice that the tax is due. Under section 13-808, from the date a notice of the lien is filed in the circuit court, it has the full force and effect of a judgment lien.

The Comptroller's individual income tax guidance says a notice of tax lien filed in the circuit court for the county where the taxpayer lives is notice to creditors of the State's claim, may have priority over other debts, and may negatively affect the taxpayer's credit rating if the account is not promptly settled.

If a filed lien is not satisfied or released by the 15th day after it is filed, recorded, and indexed, section 13-810 lets an attorney on the Comptroller's staff or the Attorney General bring an action to enforce it, and if the State's claim is established, the court may order the property sold. The Comptroller's business guidance says that once a notice of tax lien has been filed, an attachment may be issued asking the sheriff to seize assets.

Official source: Md. Code, Tax-General 13-805
Official source: Md. Code, Tax-General 13-806
Official source: Md. Code, Tax-General 13-808
Official source: Md. Code, Tax-General 13-810
Official source: Comptroller of Maryland, Tax Tip #36
Official source: Comptroller of Maryland, Business Tax Tip #10

Collection tools

What the Comptroller can do.

Notice of tax lien
Tax-General section 13-807 lets the Comptroller file a notice of tax lien with the clerk of the circuit court for the county where the property is located, and the clerk records and indexes it and enters it in the court's judgment docket with the taxpayer's name and the amount and date of the lien. Under section 13-809, the lien is not valid against a purchaser, a holder of a security interest, a mechanic's lienor, or a judgment lien creditor until the notice is filed.
Bank account levy
Under section 13-812, the Comptroller may send notice of a tax lien to a financial institution it reasonably believes holds the taxpayer's property, and the institution must promptly seize and attach from the taxpayer's accounts the lesser of the total in those accounts or the amount in the notice. The statute lets the institution charge its own fee. After the institution reports the amount it is holding, the Comptroller generally must mail the taxpayer a notice, and the taxpayer or another person who claims an ownership interest in the account may challenge the seizure by filing a motion in the circuit court within 10 days of the date of that notice. Grounds include a mistake in the identity of the taxpayer, in the ownership or contents of the account, or in the amount of the lien obligation due, or any other good cause, but not a mistake in the original assessment.
Wage lien
Under section 13-811, a tax lien for a tax the Comptroller administers covers salary, wages, or other compensation for personal services that is due or becomes payable on or after the time the lien arises. Once the employer is served by certified mail or in person, it must pay that compensation to the Comptroller, except the amount exempt from attachment under section 15-601.1 of the Commercial Law Article, until the employer receives notice that the wage lien is satisfied or released.
Other tools
In its business tax guidance, the Comptroller says that if a taxpayer does not contact it to resolve the account, it may take one or more further actions, including issuing an estimated assessment for missing returns, summoning a business to a sales and use tax license revocation hearing, intercepting state and federal refunds and vendor payments, preventing renewal of State business, professional, motor vehicle, or liquor licenses, and publishing the taxpayer's name and liability on its Caught in the Web list. For individual income tax, it says an account may also be referred to a private collections agency.

Official source: Md. Code, Tax-General 13-807
Official source: Md. Code, Tax-General 13-809
Official source: Md. Code, Tax-General 13-811
Official source: Md. Code, Tax-General 13-812
Official source: Comptroller of Maryland, Business Tax Tip #10

Payment plans, offers, and appeals.

For individual income tax, the Comptroller says a taxpayer who cannot pay in full must contact its individual income tax collections section for a payment plan, which it listed at 410-974-2432, and that a payment plan requires the amount owed to be paid within a specific time. For business taxes, it listed its business tax collection section at 410-649-0633.

The Comptroller's Offer in Compromise Program allows a taxpayer to settle a tax debt for less than the full amount owed. The Comptroller says it is not an appeal of the liability, and lists requirements that include an assessed delinquent liability, no issue currently under appeal, two years since the taxpayer became liable for the tax, current filing of all required returns (for individual income tax, the current year's return by its due date or extended due date and the returns for the prior six tax years), no open bankruptcy proceeding, and that the taxpayer is unlikely to be able to pay in full any time in the foreseeable future because of the taxpayer's financial situation. For taxes owed by a business or its officers, the business must be closed.

A tax that is wrong is challenged differently. The Comptroller says a taxpayer can file an appeal and request a hearing within 30 days of an assessment. Its business guidance says that for an estimated tax assessment, the appeal should be filed within 30 days from the date on the notice, and that an estimated assessment not appealed in that time becomes final and non-appealable. For an audit assessment, that guidance also says that while a timely appeal is in the hearing process, collection actions will not be taken.

Official source: Comptroller of Maryland, Offer in Compromise Program FAQs
Official source: Comptroller of Maryland, Tax Tip #36
Official source: Comptroller of Maryland, Business Tax Tip #10

Business taxes and personal liability.

The Comptroller says operating as a corporation does not avoid personal liability for some taxes. It says the president, a vice president, the treasurer, and any other officer owning 20 percent of the corporation's stock are personally liable for the corporation's unpaid sales and use taxes, penalties, and interest, and that any officer who exercises direct control over the corporation's fiscal management is personally liable for withholding and admissions and amusement taxes, penalties, and interest.

Official source: Comptroller of Maryland, Business Tax Tip #10

Questions

Common questions.

What happens if I do not set up a payment plan with the Comptroller?
The Comptroller says that a taxpayer who cannot pay in full must contact its individual income tax collections section for a payment plan, and that if no plan is set up or the payments are not made, it may take legal action, including filing a notice of tax lien in court or attaching bank accounts or wages. It also says the account may be referred to a private collections agency.
Does a Maryland offer in compromise application stop collection?
No. The Comptroller's Offer in Compromise Program says that receipt of an application does not create a collections hold, and that collection actions, including MVA and professional license holds, the filing of a notice of tax lien, and referral to a collection agency, continue while the application is reviewed. The application is Form MD 656 with Form MD 433-A, and the program requires, among other things, that two years have passed since the taxpayer became liable for the tax.
Can the Comptroller take my federal tax refund?
Yes. The Comptroller says it can intercept a federal income tax refund and payments due to a taxpayer as a federal vendor, and that it will apply all or part of any money the State owes the taxpayer, including a Maryland income tax refund, to the unpaid liability even if a payment plan has been set up.
How long does a Maryland tax lien last?
Under Tax-General section 13-806, a lien generally arises on the date of notice that the tax is due and continues until it is satisfied, until the Comptroller releases it as unenforceable by lapse of time or uncollectible, or until 20 years after the date of assessment, whichever comes first. Separately, section 13-1103 generally bars collecting an assessed tax more than 10 years after the date of assessment, but provides that a judgment entered may be enforced or renewed as any other judgment. How those periods apply to a particular balance depends on the facts, so do not assume a balance has expired after 10 years.

Official source: Md. Code, Tax-General 13-1103

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How the State's lien works.

What the Comptroller can do.

Notice of tax lien

Bank account levy

Wage lien

Other tools