Maryland's personal income tax system has four brackets, with rates ranging from 2 percent to 4.75 percent. Nonresidents are subject to a special tax rate of 1.25 percent in addition to the 4.75 percent rate, for an effective tax rate of 6 percent. More on Maryland taxes can be found in the tabbed pages below.
|Personal income tax|
| ||Maryland collects income taxes from its residents utilizing four tax brackets:
-- 2 percent on the first $1,000 of taxable income
-- 3 percent on taxable income between $1,001 and $2,000
-- 4 percent on taxable income between $2,001 and $3,000 and
-- 4.75 percent on taxable income of $3,001 and above .
|Residents of Maryland must file state tax forms by April 15 or the next business day if that date falls on a weekend or holiday.|
|The City of Baltimore and Maryland's 23 counties levy local "piggyback" income taxes at rates between 1.25 percent and 3.2 percent of Maryland taxable income. Local officials set the rates and the revenue is returned to the local governments quarterly.
Local income taxes are withheld and collected on the same forms as state income taxes.
|Maryland offers 10 personal income credits to eligible filers.|
|Maryland's state sales tax is 6 percent.|
|There are no general local sales taxes in Maryland.|
|Maryland also has a 6 percent use tax, applied to tax-free purchases made out of state and which must be reported and paid by filing the state's use tax return.|
|Personal and real property taxes|
|All real property in Maryland is subject to the property tax. Generally, properties that are owned and used by religious, charitable or educational organizations or property owned by the federal, state or local governments are exempt.|
|Property tax bills are issued in July or August of each year by the 23 counties, Baltimore City and the 155 incorporated municipalities in Maryland. Tax bills are rendered for the upcoming fiscal year and are effective as of July 1.|
|Real property is reassessed on a three-year cycle by the Real Property Valuation Division. Every year, one-third of all property in Maryland is reviewed including an exterior physical inspection of the property.|
|The amount of the tax bill is determined by two factors: (1) the assessment and (2) the property tax rate. Assessments are based on the fair market value of the property and are issued by the Department of Assessments and Taxation, an agency of state government. Property tax rates are set by each unit of government: the state, counties and cities.|
|Property tax rates vary widely. No restrictions or limitations on property taxes are imposed by the state, meaning cities and counties can set tax rates at the level they deem necessary to fund governmental services. These rates can increase, decrease or remain the same from year to year. If the proposed tax rate increases the total property tax revenues, the governing body must advertise that fact and hold a public hearing on the new tax rate. This is called the Constant Yield Tax Rate process.|
|The Homestead Property Tax Credit, commonly referred to as the Assessment Cap, limits the taxation of large annual assessment increases on owner-occupied residential property. For state tax purposes, any annual assessment increase for a home that is greater than 10 percent is not taxed. Counties and municipalities may limit assessment increases for local tax purposes to less than 10 percent annually.|
|Maryland also offers real property exemptions, credits for property owners and renters and exemptions for historic properties. Details on these programs can be found here.|
|To find your local property tax official, check the State Department of Assessments and Taxation Web page. Or you can call toll-free (800) 944-7403 from within the state or 767-4433 from the Baltimore area.|
|Inheritance and estate taxes|
|A Maryland estate tax return is due for residents who died after Dec. 31, 2001, if the decedent's federal gross estate, plus adjusted taxable gifts, equaled or exceeded $1 million and the decedent was either a resident of Maryland at the time of death or owned real or tangible personal property in the state.|
|Common questions and answers about Maryland's estate tax can be found on this Web page.|
|Other Maryland tax facts|
|With i-File Maryland, the state's taxpayers can e-file personal income tax returns, along with the most commonly associated schedules and forms.|
|Taxpayers in the Old Line State can go online to check the status of their tax refunds.|
|For more information, contact the Comptroller of Maryland. If you have additional tax questions, send an e-mail to the state's Tax Help service.|
|To download tax forms on this site, you will need to install a free copy of Adobe Acrobat Reader. Click here for instructions.|
-- Updated: Feb. 4, 2008