Maryland tax rates come in several layers. The state taxes personal income on a graduated scale from 2% to 5.75%, and every county plus Baltimore City adds a local income tax of 2.25% to 3.30% on top of that. Statewide sales tax is 6%, property is taxed by the state, the county, and sometimes a municipality, and Maryland is one of a handful of states that charges both an estate tax and a separate inheritance tax.
State Income Tax Brackets
Maryland’s personal income tax uses eight brackets under Tax-General Code Section 10-105. Each rate applies only to the income inside that bracket, so earning a dollar into a higher bracket does not change the tax on the dollars below it. For single filers:
- 2% on the first $1,000
- 3% on $1,001 to $2,000
- 4% on $2,001 to $3,000
- 4.75% on $3,001 to $100,000
- 5% on $100,001 to $125,000
- 5.25% on $125,001 to $150,000
- 5.5% on $150,001 to $250,000
- 5.75% on income above $250,000
Joint filers, heads of household, and qualifying surviving spouses use the same rates but with wider upper brackets. The 4.75% rate runs up to $150,000, the 5% rate to $175,000, the 5.25% rate to $225,000, and the 5.5% rate to $300,000. Taxable income above $300,000 is taxed at 5.75%.1Maryland General Assembly. Maryland Code Tax – General 10-105
County and Baltimore City Income Tax
Every Maryland county and Baltimore City charges its own income tax as a flat percentage of your Maryland taxable income. State law sets a floor of 2.25% and a ceiling of 3.30%.2Maryland General Assembly. Maryland Code Tax – General 10-106 The rate depends on where you live. Larger jurisdictions tend to sit near the top of the range; smaller counties generally stay closer to the minimum.
You do not file a separate local return. The Comptroller collects the local tax along with the state tax. Combined, a Maryland resident’s state-and-local income tax rate can land anywhere from about 4.25% at the lowest income levels in the lowest-rate county up to roughly 9% for high earners in a jurisdiction at the maximum local rate.
If you live outside Maryland but earn income inside the state, and your home state does not have a reciprocity agreement with Maryland, you pay a flat nonresident local income tax of 2.25% for 2026 instead of a county-specific rate.3Comptroller of Maryland. Payroll Changes Effective January 1, 2026
Standard Deduction and Personal Exemptions
Before the brackets apply, you subtract a standard deduction and personal exemptions. For tax year 2025 forward, the Maryland standard deduction is $3,350 for single and married-filing-separately filers and $6,700 for joint filers, heads of household, and qualifying surviving spouses.4Comptroller of Maryland. Tax Alert – Changes to Standard and Itemized Deductions and to State and Local Income Tax Rates
Each personal exemption is worth $3,200 for 2026. You can claim one for yourself, one for a spouse on a joint return, and one for each dependent. The exemption phases down as federal adjusted gross income rises, and single or married-filing-separately filers lose it entirely above $150,000 of AGI; for joint filers the full phase-out hits above $200,000. Taxpayers or spouses who are 65 or older or blind get an additional $1,000 exemption each.5Comptroller of Maryland. 2026 Maryland Form MW507
Sales and Use Tax
Maryland’s sales and use tax is 6% on most physical goods and many services. The rate is uniform statewide; counties and cities cannot add their own sales tax on top.6Maryland General Assembly. Maryland Code Tax – General 11-104 Groceries bought for home consumption and residential utilities are exempt.
Some categories carry different rates. Alcoholic beverages are taxed at 9% whether sold for on-premise or off-premise consumption. Adult-use cannabis is taxed at 12% in fiscal year 2026, up from the 9% rate that applied during the first two years of legal sales.
Digital products and digital codes delivered electronically are subject to the 6% rate. That covers streaming music and video subscriptions, e-books, downloaded software, video games and in-game purchases, digital photographs, and online access to newspapers or magazines. Cable television, satellite radio and TV, and custom-built enterprise software are outside the tax.7Comptroller of Maryland. Business Tax Tip #29 – Sales of Digital Products and Digital Code
Vehicle purchases are handled separately. Maryland charges a 6.5% excise tax on the vehicle’s book value or purchase price, with a $41.60 minimum, collected by the Motor Vehicle Administration at titling rather than by the dealer.8Maryland Motor Vehicle Administration. Buying a Vehicle in Maryland
Property Tax
Property taxes come from more than one level of government. The state charges a flat $0.112 per $100 of assessed value on all real property.9Maryland General Assembly. Maryland Code Tax – Property 6-101 Each county sets its own rate on top of that, and if your home sits inside an incorporated town or city, a third municipal rate applies as well. Combined rates typically fall somewhere between under $1.00 and over $2.00 per $100 of assessed value depending on where you live.
The Department of Assessments and Taxation reassesses every property on a three-year cycle. The assessed value multiplied by all applicable rates produces the annual bill, which is the main source of funding for local schools, public safety, and infrastructure.
Homestead Tax Credit
State law caps the annual growth in a primary residence’s taxable assessment at 10% or less, so if your home’s assessment jumps more than the cap in a year, you pay tax only on the capped amount and the rest is credited. The home has to be your principal residence, you must have lived there for at least six months of the year including July 1, and the property cannot have changed hands.10Maryland Department of Assessments and Taxation. Maryland Homestead Property Tax Credit Program Some municipalities set their own cap below 10%.
Homeowners’ Property Tax Credit
A separate program reduces the tax bill for lower-income homeowners based on household income. Combined gross household income cannot exceed $60,000 to qualify, and applications go to the Department of Assessments and Taxation each year.11Maryland Department of Assessments and Taxation. Homeowners’ Property Tax Credit Program
Estate and Inheritance Taxes
Maryland charges both an estate tax and a separate inheritance tax. The two can apply to the same estate.
The estate tax hits estates with a taxable value above $5 million. It is calculated on a graduated scale topping out at 16%, and the return is due within nine months of death.12Comptroller of Maryland. What You Need to Know About Maryland’s Estate Tax Legislation to repeal the estate tax was introduced in the 2026 session but had not been enacted as of early 2026.
The inheritance tax is paid by the person receiving property, not by the estate. The rate is 10% of the clear value, meaning fair market value minus expenses.13Maryland Register of Wills. Inheritance Tax Close family members are fully exempt. You owe nothing if you inherit from a parent, grandparent, spouse, child, grandchild or other lineal descendant, sibling, or the spouse of any of those relatives. Stepchildren and stepparents are treated the same as biological relatives. Any inheritance of $1,000 or less to a single person is also exempt.14Justia Law. Maryland Code Tax – General 7-203 – Exemptions The 10% rate mainly reaches nieces, nephews, aunts, uncles, cousins, and unrelated beneficiaries.
Retirement Income
Social Security benefits are fully exempt from Maryland income tax at any income level. Railroad Retirement Act payments get the same treatment.
Other retirement income qualifies for a partial exclusion called the pension exclusion. You can claim it if you are at least 65, or if you or your spouse is totally disabled. The maximum exclusion tracks the maximum annual Social Security benefit and was $41,200 for tax year 2025, but the amount you can actually subtract is reduced dollar-for-dollar by any Social Security or Railroad Retirement benefits you receive.
Military retirees get a separate subtraction. If you are 55 or older by the end of the tax year, you can exclude up to $20,000 of military retirement pay. Under 55, the exclusion is capped at $12,500.15Maryland Department of Veterans and Military Families. Retirement Pay and Pension Tax Deductions and Exclusion
Corporate Income Tax
Corporations pay a flat 8.25% on Maryland taxable income for tax year 2026. A bill to phase the rate down over several years was introduced but had not been enacted as of early 2026.
Filing Deadline and Reciprocity
Individual income tax returns are due April 15, matching the federal calendar. You can request an extension to file, but tax you owe keeps accruing interest from the original due date at 9% per year.16Comptroller of Maryland. Tax Tip #36 – If You Get a Notice for Personal Income Tax
Maryland has reciprocity agreements with Pennsylvania, Virginia, West Virginia, and the District of Columbia. If you live in one of those jurisdictions and commute into Maryland for work, or the reverse, you pay income tax only to your home state on wages and salary. Except for West Virginia, the agreements stop applying if you keep a residence in the other state for more than six months and are physically present there 183 days or more during the year.17Comptroller of Maryland. Administrative Release No. 3 – Nonresident Credits and Reciprocal Income Tax Agreements