(a)A financial institution shall compute its net earnings:
(1)based on the accounting period used as its fiscal year; and
(2)subject to the modifications required under this section, in the manner that a corporation computes, for purposes of the income tax, the Maryland modified income.
(b)A financial institution shall add to its net earnings computed under subsection (a) of this section the amounts that, even if otherwise allowed to be subtracted under § 10–307(b) and (g)(1) and (4) of this article, equal:
(1)profit realized from the sale or exchange of bonds issued by this State or a political subdivision of this State;
(2)dividends received from foreign corporations and included in federal gross income under § 78 of the In
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(a) A financial institution shall compute its net earnings:
(1) based on the accounting period used as its fiscal year; and
(2) subject to the modifications required under this section, in the manner that a corporation computes, for purposes of the income tax, the Maryland modified income.
(b) A financial institution shall add to its net earnings computed under subsection (a) of this section the amounts that, even if otherwise allowed to be subtracted under § 10–307(b) and (g)(1) and (4) of this article, equal:
(1) profit realized from the sale or exchange of bonds issued by this State or a political subdivision of this State;
(2) dividends received from foreign corporations and included in federal gross income under § 78 of the Internal Revenue Code;
(3) interest derived from a United States obligation;
(4) State tax–exempt interest received from a mutual fund and allowed to be subtracted under § 10–307(g)(4) of this article; and
(5) interest excluded from federal gross income under § 103 of the Internal Revenue Code and derived from a bond:
(i) issued by a state or a public corporation, special district, or political subdivision of a state or their instrumentalities; or
(ii) under § 150 of the Internal Revenue Code, treated as a bond issued by a state or a public corporation, special district, or political subdivision of a state or their instrumentalities.
(c) A financial institution shall subtract from its net earnings computed under subsection (a) of this section interest expense incurred to purchase or carry a bond as defined in subsection (b)(5) of this section.