Maryland's Income Tax Rates for 2024

Maryland uses a progressive income tax system, meaning the tax rate increases as your income goes up. You pay different percentages on different portions of your income, not one flat rate on everything you earn. The state has eight tax brackets that range from 2% on the lowest income to 5.75% on the highest.

For single filers in 2024, the brackets start at 2% on income up to $1,000, then move to 3% on income from $1,001 to $2,500, and continue climbing through higher brackets. The top rate of 5.75% applies to income over $300,000. If you're married filing jointly, the income thresholds are roughly double, so you reach each bracket at a higher dollar amount. Maryland also taxes capital gains and dividends, though some types of retirement income receive preferential treatment.

Your actual tax bill depends on where your total income falls across these brackets. Someone earning $50,000 won't pay 5.75% on all of it—they'll pay 2% on the first $1,000, 3% on the next $1,500, and so on, with the remaining income taxed at whatever bracket it falls into. This is why knowing your total household income matters when estimating what you'll owe.

Key Takeaways

  • Maryland income tax ranges from 2% to 5.75% depending on your income level, with eight separate tax brackets for single and married filers.
  • Sales tax in Maryland is 6%, though some counties add a local tax that brings the total to 6.5% or higher at checkout.
  • Property tax rates vary significantly by county, ranging from roughly 0.8% to 1.1% of your home's assessed value each year.
  • Maryland offers tax credits and deductions for certain situations, including dependent exemptions and education-related expenses, which can lower your final bill.
  • You can find your exact county's sales tax rate and property tax rate on the Maryland Department of Assessments and Taxation website.

Maryland Sales Tax: State and Local Rates

The state sales tax in Maryland is 6%, but what you actually pay at the register depends on where you shop. Most Maryland counties add their own local sales tax on top of the state rate, so your total can be 6.5% or higher. Anne Arundel County, Baltimore County, and several others charge an additional 0.5%, bringing the total to 6.5%. Some counties have negotiated different rates with the state.

Food purchased at a grocery store is exempt from sales tax in Maryland, which saves money on everyday purchases. However, prepared food, restaurant meals, and food bought at convenience stores are taxed at the full rate. Clothing is also exempt, but shoes and accessories may fall under different rules depending on the item.

The easiest way to know your exact local rate is to check the Maryland Department of Assessments and Taxation website or ask a cashier in your county. Rates don't change frequently, but they can shift if a county passes new legislation, so it's worth confirming if you're budgeting for a large purchase.

Property Tax Rates by County

Maryland property taxes are assessed and collected at the county level, which means the rate you pay depends entirely on where your home is located. There is no single statewide property tax rate. Counties assess property values and then set their own tax rates, which typically range from about 0.8% to 1.1% of your home's assessed value per year.

Baltimore City has one of the higher rates in the state, while some rural counties have lower rates. A home assessed at $300,000 in a county with a 1% rate would owe $3,000 in annual property tax, while the same home in a county with a 0.8% rate would owe $2,400. Over time, these differences add up significantly.

Your county assessor's office determines the assessed value of your property, which is usually lower than the market value. You receive a notice of assessment in the mail, and you have the right to appeal if you believe the value is incorrect. Property tax bills are typically due in two installments per year, though the exact dates vary by county.

How Maryland Calculates Your Income Tax Bracket

To find which bracket applies to you, add up all your income for the year—wages, self-employment income, investment income, and any other sources. Then locate that total on the tax bracket table for your filing status (single, married filing jointly, married filing separately, or head of household). Each bracket has a range, and you find the range your income falls into.

Maryland's Department of Revenue publishes updated bracket tables each year because the income thresholds adjust slightly for inflation. You can read the current year's tables from their website, or your tax software will explore them automatically. The brackets are the same whether you file your federal return with the IRS or not—Maryland taxes are separate from federal taxes.

If you're self-employed, you also owe Maryland self-employment tax, which is calculated differently from income tax. Self-employed individuals pay both the employee and employer portions of certain taxes, which increases their overall tax burden. Many self-employed people set aside money quarterly to cover these payments rather than waiting until tax time.

Tax Credits and Deductions Available in Maryland

Maryland offers several tax credits that can reduce what you owe. The dependent exemption allows you to deduct a set amount for each dependent child or other may have access to relative, which lowers your taxable income. The state also offers credits for education expenses, including tuition paid to Maryland colleges and contributions to education savings accounts.

If you're a renter, Maryland has a property tax credit that may lower your state income tax bill based on the rent you paid during the year. Homeowners over age 65 may may have access to for a homestead property tax credit. Parents who pay for childcare so they can work may be able to claim a childcare credit. These credits vary in how much they reduce your tax bill and have income limits that determine who can use them.

To claim these credits, you typically report them on your Maryland tax return when you file. Your tax software or a tax preparer can help you determine which ones explore to your situation. The Maryland Department of Revenue website lists all available credits with income thresholds and documentation requirements.

When and How to File Maryland Taxes

Maryland income tax returns are due on the same day as federal returns, which is typically April 15 unless that date falls on a weekend or holiday. You can file online using tax software, through a tax preparer, or by mailing a paper return to the Maryland Department of Revenue. If you owe money, you can pay online, by mail, or through an installment plan if you can't pay the full amount at once.

If you expect a refund, filing early can get your money back faster. Maryland processes refunds within four to six weeks of receiving your return if you file electronically. Paper returns take longer. You can check the status of your refund on the Maryland Department of Revenue website using your Social Security number and refund amount.

If you're unable to file by the important date, you can request an extension, which gives you until October 15 to submit your return. However, an extension to file is not an extension to pay—if you owe taxes, interest and penalties begin accruing on April 15 even if you file later. Paying what you estimate you owe by the original important date, even if you haven't finished your return, protects you from penalties.

Special Tax Situations in Maryland

Maryland taxes military retirement pay, which is different from many other states. If you're a retired member of the armed forces, your military pension is subject to Maryland income tax unless you may have access to for a specific exemption. Some veterans may be able to exclude a portion of their military retirement income, so it's worth checking whether you may have access to.

If you work in Maryland but live in another state, or vice versa, you may owe taxes in both places. Maryland has reciprocal agreements with some neighboring states that prevent double taxation, but you'll need to file returns in both states and claim credits to avoid paying tax twice on the same income. This situation is common for people who live near the state border.

Retirees who receive Social Security benefits should know that Maryland does not tax Social Security income. However, if you have other income sources like pensions, investments, or part-time work, those are still taxable. This makes Maryland relatively favorable for retirees compared to states that tax Social Security.

Frequently Asked Questions

Does Maryland tax Social Security benefits?

No, Maryland does not tax Social Security income. However, other types of retirement income, such as pensions, 401(k) withdrawals, and IRA distributions, are subject to Maryland income tax unless they may have access to for a specific exemption.

What's the difference between state and local sales tax in Maryland?

The state sales tax is 6%, but counties can add their own local tax on top of that. Your total sales tax depends on which county you're shopping in. For example, Anne Arundel County adds 0.5%, making the total 6.5%, while other counties may have different rates.

Can I appeal my property tax assessment?

Yes, you have the right to appeal your property assessment if you believe it's incorrect. Contact your county assessor's office for the appeal process and important date, which varies by county. You'll typically need to provide evidence that your home's assessed value is too high.

How do I know if I owe Maryland taxes if I moved during the year?

If you moved to or from Maryland during the year, you may owe taxes to both Maryland and your previous state. You'll file a part-year resident return in Maryland showing only the income earned while you lived there. Contact the Maryland Department of Revenue or a tax preparer to determine your filing requirements.

What happens if I don't file a Maryland tax return?

If you owe taxes and don't file, the Maryland Department of Revenue can assess penalties and interest on the amount owed. They may also place a lien on your property or take other collection actions. If you're unsure whether you need to file, contact the department or a tax professional to clarify your situation.