Md. farmers eligible for tax credits for donated food
ANNAPOLIS, Md. — Maryland farmers will be eligible next month for an expanded state program that awards tax credits for donated food.
Starting July 1, farmers will be able to receive tax credits worth half the value of their donations up to $5,000 per farm each year. Donations of Certified Organic produce are eligible for credits worth 75 percent of the value.
In April, the state legislature expanded the program, which was launched as a pilot in 2017 and exclusive to farms in Southern Maryland. Up to $100,000 in credits are available each year.
“Hopefully, it’ll be a little more enticement to donate,” said Amy Cawley, a coordinator at the Maryland Food Bank in Baltimore. “With it being in Southern Maryland before, it was kind of limiting.”
The program was little used in its first two years, according to state documents. In 2017, one farmer received $10,000 in credits. Last year, two farmers qualified for credits that totaled more than $5,000. The state agriculture department plans to promote the program more this year to make sure farmers are aware of it.
Local produce represents a small slice of the food bank’s donations, Cawley said, but it’s essential because it’s healthier than much of the pre-packaged foods the bank typically receives from grocers.
“This is an avenue where we can provide nutritious produce to people who are struggling,” she said.
Under the new law, the agriculture department will be required to establish and publish the value of food eligible for donation each week. Farmers must donate to organizations selected by the agriculture department to issue tax credit certificates. They can claim the credits against their state income tax.