Maryland State Tax: Overview
Maryland’s state income tax brackets don’t reach 6%, but counties can impose their own tax rates. And while the lowest Maryland state income tax rate is 2%, workers with more than $3,000 of taxable income could pay at least 4.75%.
Gas taxes are high in Maryland, too. And the state has both an inheritance and an estate tax. However, Maryland offers property tax credits to eligible residents and doesn’t tax Social Security retirement income.
[Data for this state tax guide was gathered from several sources including the U.S. Census Bureau, the state’s government website, the Sales Tax Handbook, and the Tax Foundation. Property taxes are cited as a rate percentage rather than the assessed value.]
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Maryland income taxes
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Maryland Tax on Retirement Benefits: Social Security retirement benefits and Railroad Retirement benefits are tax-exempt. Residents 65 or older may be able to exclude some forms of qualified retirement income. For 2022, Maryland’s pension exclusion was $34,300.
Maryland Income Tax Range: Single filers, married filing separately, or dependent taxpayers
| Up to $1,000 | 2% |
| $1,001 to $2,000 | $20 plus 3% of the amount over $1,000 |
| $2,001 to $3,000 | $50 plus 4% of the amount over $2,000 |
| $3,001 to $100,000 | $90 plus 4.75% of the amount over $3,000 |
| $100,001 to $125,000 | $4,697.50 plus 5% of the amount over $100,000 |
| $125,001 to $150,000 | $5,947.50 plus 5.25% of the amount over $125,000 |
| $150,001 to $250,000 | $7,260.00 plus 5.5% of the amount over $150,000 |
| More than $250,000 | $12,760.00 plus 5.75% of the amount over $250,000 |
Maryland Income Tax Range: Joint filers, head of household and qualifying widows/widowers
| Up to $1,000 | 2% |
| $1,001 to $2,000 | $20 plus 3% of the amount over $1,000 |
| $2,001 to $3,000 | $50 plus 4% of the amount over $2,000 |
| $3,001 to $150,000 | $90 plus 4.75% of the amount over $3,000 |
| $150,001 to $175,000 | $7,072.50 plus 5% of the amount over $150,000 |
| $175,001 to $225,000 | $8,322.50 plus 5.25% of the amount over $175,000 |
| $225,001 to $300,000 | $10,947.50 plus 5.5% of the amount over $225,000 |
| More than $300,000 | $15,072.50 plus 5.75% of the amount over $300,000 |
(Note: Local income taxes may also apply.)
How much are property taxes in Maryland?
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In Maryland, the average effective property tax rate is 1.06%.
Maryland Property Tax Breaks for Retirees
Local governments can establish a property tax deferral program that allows Maryland residents 65 or older to defer the increase in their tax bill for county taxes. The deferred taxes become a lien on the property and must be repaid when the property is transferred.
Maryland’s Renters’ Tax Credit program provides up to $1,000 annually for qualifying residents. Income limits apply, but the credit is not limited to renters over age 65.
Maryland motor fuel taxes
Gasoline: $0.47 per gallon
Diesel: $0.4775 per gallon
Maryland taxes on alcohol and tobacco
| Cigarettes | $3.75 per pack |
| Other tobacco products | 53% of wholesale price (with exceptions) |
| Vapor Products | 12% to 60% of retail price |
| Beer | $0.09 per gallon |
| Wine | $0.40 per gallon |
| Liquor | $1.50 per gallon |
(Note: Alcohol sales are also subject to a 9% sales tax rate.)
Maryland estate and inheritance taxes
Maryland has estate and inheritance taxes (‘Death Taxes‘). Maryland’s estate exemption is $5 million, so you don’t need to worry about paying this tax if your estate is valued under that amount.
However, Maryland’s inheritance tax, which is 10% of the clear value (fair market value minus qualified expenses), applies to some heirs when the value of the property exceeds $1,000. Many descendants (including but not limited to spouses and children) are exempt from paying inheritance taxes in Maryland.