Filing Maryland State Taxes

There are four brackets in the Maryland's personal income tax system. Tax rates for residents of Maryland range from 2% to 4.75%. Nonresidents need to pay an additional income tax rate of 1.25% in the state of Maryland.

Income Tax Information

Personal income Tax

• You need to pay 2% on the first $1,000 of taxable income.
• You need to pay 3% on taxable income between $1,001 and $2,000.
• You need to pay 4% on taxable income between $2,001 and $3,000.
• You need to pay 4.75% on taxable income of more than $3,001.

The State of Maryland provides eligible filers with 10 personal income credits. They include :

• Heritage Structure Rehabilitation Tax Credit.
• Income Taxes Paid to Other States Credit.
• Long-Term Care Insurance Credit.
• Neighborhood Stabilization Credit.
• Poverty-Level Credit.
• Aquaculture Oyster Float Credit.
• Preservation and Conservation Easement Credit.
• Quality Teacher Incentive Credit.
• Earned Income Tax Credit.
• Child and Dependent Care Unit.

Sales Tax

The sales tax in the state of Maryland is 6%. You do not need to pay any general local sales taxes. A use tax of 6% is also applicable in Maryland. This tax is imposed on tax-free purchases made out of Maryland.

Property and Real Estate Property Tax

Property tax is applicable on all real estate properties in Maryland. However, properties owned by charitable, religious and educational organizations are exempt from this tax. Property owned by state, federal and local government is also exempted from the property tax. It is the responsibility of the Real Property Valuation Division to reassess the property every three years. One third of all properties in the state are reviewed annually. Exterior physical inspection of the property also takes place during this time. The tax bill amount is evaluated on the basis of property tax rate and the assessment.

Assessments are normally done on the basis of the fair market value of the property. Generally, assessments are issued by the Department of Assessments and Taxation. Each unit of state, cities and counties government set the property tax rates. The property tax rates in the state of Maryland vary widely. As there are no limitations on property taxes in Maryland, the government is given full freedom to set the rate in such a way that there is no negative impact on the funding of governmental services. The rates set by the government can increase, decrease or remain the same. For property owners and renters, there are property exemptions and credits in the state of Maryland.

Maryland Tax Facts

Taxpayers in Maryland can e-file personal income tax returns with the help of i-File Maryland. One good thing about i-File Maryland is that you can get all kinds of tax related forms on the site as well as tax advice and help.