“What has happened to the taxpayers who had the foresight to make claims for refunds, knowing that it was wrong for Maryland to tax income already taxed in other states, is an unconstitutional taking without due process.”
The Baltimore law firms Brown Goldstein & Levy and the Law Offices of Stuart Levine, LLC announced the filing of a $38.4 million class action lawsuit against the Maryland Comptroller’s Office seeking to recover millions of dollars of interest unlawfully withheld from tax refunds ordered by the United States Supreme Court.
In May the Supreme Court ruled that Maryland had illegally taxed income earned by Maryland taxpayers in other states, entitling those taxpayers to refunds. Anticipating that it would lose in court, the General Assembly retroactively reduced the amount of interest to be paid on these refunds from 13% to 3.25%.
The lawsuit claims that this after-the-fact reduction of the interest rate violates the takings and due process clauses of the US Constitution.