Filing Information for Individual Income Tax

Whether you file electronically using our free iFile service, hire a professional preparer, have us prepare it for free, or complete a paper return, filing a Maryland tax return is easy.

The Maryland income tax return filing deadline is April 15, 2020. Should this date fall on a Saturday, Sunday or legal holiday, the tax return must be received by the next business day.

For those in a hurry, some quick links to everything you need to know about...

Follow the links to sort out all the details quickly and make filing your tax return painless!

Methods of Filing Maryland Tax Returns

File Yourself!

There are several ways you can file your personal or business income tax returns on paper or electronically. Please review the links at the bottom of the page, and choose the filing method that best fits your needs.

...Or You Can Use Independent Computer Software Products

You can file both your Maryland and federal tax returns online using approved software on your personal computer. To use this method, you'll need to know the correct county abbreviation for the Maryland county in which you live. You may need to enter the correct subdivision code for the city in Maryland in which you live.

...Or You Can Use a Professional Tax Preparer

You can choose among a host of professional tax preparers in Maryland who can file your return electronically for you. While we cannot endorse any specific professional, we offer a list of e-file providers for individuals and businesses for your convenience.

IRS Electronic Free File for Federal Returns

You may qualify to electronically file your federal return for free by using IRS Free File Some of the companies participating in the IRS Free File service will file your Maryland return electronically for free as well. No matter what company you select, you can always return to file your Maryland tax return for free online, using our iFile or bFile services. Keep in mind that your Maryland return begins with your federal adjusted gross income, so you must prepare your federal return first before you can prepare your Maryland return.

Generally, you are required to file a Maryland income tax return if:

  • You are or were a Maryland resident;
  • You are required to file a federal income tax return; and
  • Your Maryland gross income equals or exceeds the level listed below for your filing status. The filing levels also apply to nonresident taxpayers who are required to file a Maryland return.

Even if you are not required to file a federal return, you may be required to file a Maryland return if your Maryland addition modifications added to your gross income exceed the filing requirement for your filing status. Dependent taxpayers must take into account both their additions to and subtractions from income to determine their gross income.

If you are a senior citizen, see also Filing Requirements for Seniors.

For more information, see the instructions in the Maryland resident tax booklet and nonresident tax booklet.

Filing Requirements for 2019 Tax Year

Filing Status

Gross Income

Single (including dependent taxpayers) 

Under 65 $ 12,200
65 or older $ 13,850

Head of Household

Under 65 $ 18,350
65 or older $ 20,000

Married Filing Jointly

Both under 65 $ 24,400
One spouse 65 or older $ 25,700
Both 65 or older $ 27,000

Married Filing Separately

All (regardless of age) $ 12,200

Qualifying Widow(er)

Under 65 $ 24,400
65 or older $ 25,700

You may submit your paper tax forms and payments, or get assistance in person at any of our local branch offices. Assistance is available 8:30 a.m. - 4:30 p.m., Monday through Friday.

Your income tax return is due April 15, 2020.

If you are a fiscal year taxpayer, complete the fiscal year information at the top of Form 502, and print "FY" in bold letters in the upper left hand corner of the form. Whenever the term "tax year" appears in the instructions, fiscal year taxpayers should understand the term to mean "fiscal year." Use the current year tax forms for fiscal years which begin during the current calendar year (i.e. use 2019 tax forms for calendar year 2019). Fiscal year returns are due on the 15th day of the 4th month following the close of the fiscal year.

If any due date falls on a Saturday, Sunday or legal holiday, the return must be filed by the next business day.

The fastest way to file your return and receive your refund is to file electronically and request direct deposit. If you request direct deposit on your electronic return, your refund should be in your bank account within 72 hours of acknowledgement from the Revenue Administration Division. To pay your taxes, you may request electronic funds withdrawal (direct debit) payments on your electronic return.

If you both file and pay electronically, your return is due April 15th. However, you will have until April 30th to make your electronic payment. Note: An online payment where the bank mails the Comptroller of Maryland a paper check is not considered an electronic payment. You may file your return electronically through your personal computer using our free online service. Please do not send a paper copy of the return if you choose to file electronically.

Filing an Amended Return

You must file an amended return to make certain changes to your original return. These include changes in income, filing status, amount of deductions, the number of exemptions, and the amount of additions and subtractions to income. Note: Changes made as part of an amended return are subject to audit for up to three years from the date the amended return is filed. Use Form 502X to file an amended return and include a copy of your federal return. For more information on filing an amended return please see Instruction 28 in the Maryland resident tax booklet.

Generally, you are required to use the same filing status on your Maryland income tax return as used on your federal income tax return or the filing status that you would have used if required to file a federal income tax return.

This applies whether you are a resident COMAR 03.04.02.02 or nonresident COMAR 03.04.02.03 of the State of Maryland.

Maryland has six filing statuses based on the filing status used on your federal income tax return.

If you are: Check the box for: Additional Information
Any person who can be claimed as a dependent on his/her parent's (or another person's) federal return Dependent taxpayer - Filing Status 6 Single Dependent taxpayers, regardless of whether income was earned or unearned, are not required to file a Maryland income tax return unless their gross income is $12,200 or more.
Any person who filed as head of household on his/her federal return Head of household - Filing Status 4  
A qualifying widow(er) with dependent child who filed a federal return with this status Qualifying widow(er) with dependent child - Filing Status 5  
All other single persons Single - Filing Status 1 If your spouse died during the year AND you filed a joint federal return with your deceased spouse, you may still file a joint Maryland return.
If you are: Check the box for: Additional Information
Any person who can be claimed as a dependent on his/her parent's (or another person's) federal return Dependent taxpayer - Filing Status 6 You do not get an exemption for yourself. Put a zero in Exemption Box a. You and your spouse must file separate returns.
Any person who filed as head of household on his/her federal return Head of household - Filing Status 4  
Married couples who filed separate federal returns Married filing separately - Filing Status 3 Each taxpayer must show his/her Social Security number in the blank next to the filing status box.
Married couples who filed joint federal returns but had different tax periods

Joint return - Filing Status 2  OR

Married filing separately - Filing Status 3

If you are not certain which filing status to use, figure your tax both ways to determine which status is best for you.
Married couples who filed joint federal returns but were domiciled in different countries, cities, towns or taxing areas on the last day of the tax year If you are filing separately, see Instruction 8. If you are filing a joint return, see the SPECIAL NOTE in Instruction 19.
Married couples who filed joint federal returns but were domiciled in different states on the last day of the tax year If you are filing separately, see Instruction 8. If you are filing a joint return, you must attach a pro forma Form 505 and Form 505NR.
All other married couples who filed joint federal returns Joint return - Filing Status 2  

Resident -Your permanent home is or was in Maryland (the law refers to this as your domicile). OR your permanent home is outside of Maryland, but you maintained a place of abode (that is, a place to live) in Maryland for more than six months of the tax year. If this applies to you and you were physically present in the state for 183 days or more, you must file a full-year resident return.

Nonresident - Your permanent home (domicile) is in a state other than Maryland, unless you are a statutory resident. 

Statutory resident - You maintain and occupy a place of abode (that is a place to live) for more than 6 months of the tax year in Maryland.

Part-Year Residents - If you either established or abandoned Maryland residency during the calendar year, you are considered a part-year resident.

For more information about residency, see Administrative Release No. 37 - Domicile and Residency.

For further information on how to file, see the links below.

If you were domiciled in Maryland on the last day of the taxable year, or you maintained a place of abode (a place to live) in Maryland, and were physically present in Maryland for more than six months of the tax year, then you are a legal resident.

If you are a Maryland resident, you are required to file a Maryland income tax return if you are required to file a federal income tax return, and your gross income equals or exceeds the level for your filing status in Filing Requirements see above and in Instruction 1 of the Maryland resident tax booklet. Dependent taxpayers must take into account both their additions to and subtractions from income to determine their gross income. See also, If You Work in Another State below.

Even if you are not required to file a federal return, you may be required to file a Maryland return if your Maryland addition modifications added to your gross income exceed the filing requirement for your filing status.

If you work in Washington, D.C., Pennsylvania, Virginia and West Virginia

If you live in Maryland and work in Washington, D.C., Pennsylvania, Virginia or West Virginia you should file your state income tax return with Maryland.

If you commute to work in one of the states listed above, and your employer withholds taxes for that jurisdiction, you can file the appropriate form with that locality to obtain a refund.

If you work in any other state on a regular basis, it's a good idea to contact that state's taxing authority to determine your taxable status from their perspective.

If you have income that is taxed in another state and/or a locality in another state, see Maryland Form 502CR to determine if you are eligible for a tax credit. Be sure to include your completed Form 502CR with your Maryland return, along with a copy of the return you filed with the other state and/or a locality in another state.

If you work in Delaware

Maryland residents who work in Delaware must file tax returns with both states. To avoid dual taxation, you can get a credit for taxes paid to Delaware and/or a locality in Delaware by completing Maryland Form 502CR and filing it with your Maryland income tax return. Be sure to include a copy of your Delaware return and/or return of the locality in Delaware.

If you either established or abandoned Maryland residency during the calendar year, you must file as a part-year resident, using Form 502. You may also be required to file a return with your other state of residence.

Filing a part-year return in your first year of residency may help you avoid receiving a notice asking why you did not file with Maryland the previous year.

Instruction 26 in the Maryland resident tax booklet outlines the following steps for completing your part-year tax return correctly:

  1. You must file Form 502.
  2. Whenever the term "tax year" is used in these instructions, it means that portion of the year in which you were a resident of Maryland. If you began residence in Maryland in 2018, the last day of the tax year was December 31, 2018. If you ended residence in Maryland in 2018, the last day of the "tax year" was the day before you established residence in another state.
  3. Complete the name and address information at the top of Form 502. On Current Mailing Address Line 1, enter the street number and street name of your current address. If using a PO Box address, enter PO Box and the PO Box number on Current Mailing Address Line 1. On Current Mailing Address Line 2, if applicable enter the floor, suite, or apartment number for your current mailing address. If using a PO Box address, leave Current Mailing Address Line 2 blank.
  4. Complete the political subdivision information using Instruction 6. The political subdivision information includes the 4 DIGIT POLITICAL SUBDIVISION CODE, MARYLAND POLITICAL SUBDIVISION, PHYSICAL STREET ADDRESS LINE 1, PHYSICAL STREET ADDRESS LINE 2, CITY, ZIP CODE +4, and MARYLAND COUNTY fields. Use the county, city, town or taxing area of which you were a resident on the last day of your Maryland residence.
  5. Complete the filing status area using the same filing status that you used on your federal return. Married couples who file joint federal returns may file separate Maryland returns under certain circumstances. See Instruction 7 in the tax booklet. If you are a dependent taxpayer, use filing status 6.
  6. Complete the Exemptions area. You can claim the same number of exemptions that were claimed on your federal return. Additional exemptions are allowed for age and blindness for Maryland purposes which will be computed in this area.
  7. Complete the Part-Year/Military area on the front of Form 502. Place a "P" in the box and show the dates of residence in Maryland. Certain military taxpayers following these instructions should place an "M" in the box and enter the non-Maryland military income. If you are both part-year and military, place a "P" and "M" in the box. Married taxpayers with different tax periods filing a joint Maryland return should enter a "D" in the box. Follow the remainder of this instruction and write "different tax periods" in the dates of residence area. Married taxpayers who file a joint return when one spouse is not a resident of Maryland should place a "P" in the part-year resident box and enter the name and the other state of residence of the nonresident spouse.
  8. Enter on line 1 the adjusted gross income from your federal return for the entire year, regardless of your length of residence.
  9. Complete the Additions to Income area using Instruction 12. If you had losses or adjustments to income on your federal return, write on line 5 those loss or adjustment items, which were realized or paid when you were not a resident of Maryland.
  10. Complete the Subtractions from Income area using Instruction 13. You may include only subtractions from income that apply to income subject to Maryland tax. Include on line 13 any income received during the part of the year when you were not a resident of Maryland.
  11. You must adjust your standard or itemized deductions and exemptions based on the percentage of your income subject to Maryland tax. Complete the Maryland Income Factor Worksheet to figure the percentage of Maryland income to total income. The factor cannot exceed 1 (100%) and cannot be less than zero (0%). If line 1 is 0 or less, the factor is 0. If line 1 is greater than 0 and line 2 is 0 or less, the factor is 1.
  12. If you itemize deductions, complete lines 17a - 17b of Form 502. Prorate the itemized deductions using this formula: Net itemized deductions X Maryland income factor = Maryland itemized deductions. Enter the prorated amount on line 17 of Form 502 and check the Itemized Deduction Method box. Another method of allocating itemized deductions may be allowed. Please send your written request along with your completed Maryland return, a copy of your federal return including Schedule A and a copy of the other state's return. If the other state does not have an income tax, then submit a schedule showing the allocation of income and itemized deductions among the states. The Maryland return must be completed in accordance with the alternative method requested. This request should be sent to the Revenue Administration Division, Taxpayer Accounting Section (Special Allocations), P.O. Box 1829, Annapolis, MD 21404-1829.
  13. If you are not itemizing deductions, you must use the standard deduction. The standard deduction must be prorated using the Maryland income factor. Calculate the standard deduction using the worksheet in Instruction 16 of the tax booklet. Prorate the standard deduction using the following formula: Standard deduction X Maryland income factor = Prorated standard deduction. Enter the prorated amount on line 17 of Form 502 and check the Standard Deduction Method box.
  14. The value of your exemptions (line 19) must be prorated using the Maryland income factor. Use this formula: Total state exemption amount X Maryland income factor = Prorated exemption amount. Enter the prorated exemption amount on line 19 of Form 502.
  15. You must prorate your earned income, poverty level and refundable earned income credits (if you qualify) using the Maryland income factor. See Instruction 26 in the Maryland tax booklet to see how the factor is applied.

Part-year residents with pensions

Part-year residents with pensions should complete the pension exclusion worksheet using total taxable pension and total Social Security and Railroad Retirement benefits as if you were a full-year resident. Prorate the amount on line 5 by the number of months of Maryland residence divided by 12. However, if you began receiving your pension during the tax year you became a Maryland resident, use a proration factor of the number of months you were a resident divided by the number of months the pension was received.

If you are a nonresident of Maryland, you are required to file Form 505 (Maryland Nonresident Income Tax Return) and Form 505NR (Maryland Nonresident Income Tax Calculation) if you have income derived from:

  • Tangible property, real or personal, permanently located in Maryland;
  • A business, trade, profession or occupation carried on in Maryland; or,
  • Gambling winnings derived from Maryland sources.

You are not required to file as a nonresident if:

  • Your Maryland gross income is less than the minimum filing level for your filing status;
  • You had no income from a Maryland source; or
  • You reside in Pennsylvania, Virginia, West Virginia or Washington, D.C., and earned only wages in Maryland. For more information, see If You Are A Nonresident Working In Maryland (below) and the instructions in the Maryland nonresident tax booklet.

Tax Calculation

Nonresidents who work in Maryland or derive income from a Maryland source are subject to the appropriate Maryland income tax rate for your income level, as well as a special nonresident tax rate of 1.75%. By law, the nonresident tax rate must equal the lowest local income tax rate paid by Maryland residents (currently 1.75%) combined with the top state tax rate.

You will use your total income (with certain modifications) to compute the tax rate to be used on Form 505. You will then use Form 505NR to compute your Maryland taxable net income with your subtractions for non-Maryland income. This Maryland taxable net income will be used as the numerator of a nonresident factor. Your Maryland income without allowing you the non-Maryland subtractions will be the denominator. This nonresident factor applied to the tax that was calculated on your total income arrives at the Maryland tax. The special nonresident tax is applied to your Maryland net taxable income as calculated on Form 505NR. For more information, see the instructions in the Maryland nonresident tax booklet.

You can calculate your nonresident tax due using our estimated nonresident tax calculator.

Deductions

Nonresident taxpayers may either use Maryland's standard deduction or itemize deductions. You may elect to use the standard deduction whether or not you itemized deductions on your federal income tax return. You may itemize deductions on your Maryland return only if you have itemized them on your federal return. Deductions and exemptions must be apportioned using the ratio of Maryland income to federal adjusted gross income.

Amending Returns

If you are a nonresident and amending your Maryland income tax returns, you should obtain a Form 505X and a nonresident tax booklet for the year you wish to amend so that you will have the proper instructions and rates. Exemptions, deductions and certain credits must be prorated using the Maryland income factor. Attach revised Forms 505 and 505NR to your amended return.

Nonresident Sale of Property

If you are a nonresident who owned and sold or transferred real property and associated tangible personal property in Maryland, you must make a tax withholding payment to the local clerk of the circuit court or the State Department of Assessments and Taxation (SDAT). The payment must be made before the deed or other instrument of transfer is recorded with the court clerk or filed with SDAT. For more information, see Sales of Real Property by Nonresidents (below).

If you are a nonresident who works in Maryland and/or derives other income from a Maryland source, you are subject to Maryland's income tax rates as well as the special nonresident tax rate of 1.75%. For more information about the filing requirements for nonresidents, see the instructions in the Maryland nonresident tax booklet.

If you are a nonresident who works in Maryland, you must also complete Form MW507 (Employee's Maryland Withholding Exemption Certificate) for your payroll department to determine the proper number of exemptions in calculating your income tax withholding.

Residents of Pennsylvania, Virginia, West Virginia and Washington, D.C.

If you work in Maryland but reside in a reciprocal tax state (Pennsylvania, Virginia, West Virginia or Washington, D.C.), and your only income from a Maryland source is wages, you can be exempt from Maryland income tax and Maryland withholding tax on those wages. Follow the instructions for line 4 of the MW507 form.

Delaware residents

If you work in Maryland but reside in Delaware, you must file Form 505 (Maryland Nonresident Income Tax Return) and Form 505NR (Maryland Nonresident Income Tax Calculation). However, if you reside within the city limits of Wilmington, you must file Form 515 to report your taxable wage income.

Residents of Alabama, Delaware, Indiana, Kentucky, Michigan, Missouri, New York, Ohio, and Pennsylvania jurisdictions which impose local taxes on Maryland residents

If you work in Maryland but reside in a local jurisdiction of Alabama, Delaware, Indiana, Kentucky, Michigan, Missouri, New York, Ohio, and Pennsylvania that imposes a local income or earnings tax on Maryland residents, you must file Form 515. To verify local tax laws, contact your local government in the jurisdiction in which you reside.

Correcting Maryland taxes withheld in error

If Maryland tax was withheld from your income in error you must file to obtain a refund. Complete all of the information at the top of the Form 505 including the filing status, residence information and exemption areas. Check the box provided to the right of the residence information for you to indicate your withholding was withheld in error. See instruction 4 of the nonresident booklet.

Nonresident sale of property

If you sell or exchange real property that you own in Maryland, tax must be withheld at the time of sale unless a specific exemption applies. The tax will be withheld based on the total payment from the sale of that property and associated tangible personal property. The person responsible for recording the deed must pay the withholding tax to the Clerk of the Court or the State Department of Assessments and Taxation (SDAT) at the time of recordation. The payment must be made before the deed or other instrument of transfer is recorded with the court, or filed with the SDAT. For more information, see Sales of Real Property by Nonresidents (below).

If you are a nonresident who owns and is selling or transferring real property and associated tangible personal property in Maryland, you must make a tax withholding payment to the local Clerk of the Circuit Court or the Maryland Department of Assessments and Taxation (SDAT). The payment must be made before the deed or other instrument of transfer is recorded with the court clerk or filed with SDAT.

Generally, the person responsible for your closing, a title company for example, is responsible for ensuring that sufficient funds are withheld at settlement and for paying the amount of withholding tax due to the Clerk or SDAT when the deed or other instrument of transfer is presented for recordation.

For a nonresident individual, the payment is 7.5% of the total property sale payment made to the individual. A nonresident entity must make an 8.25% payment.

Under this provision, a nonresident entity is an entity that is:

  • not formed under the laws of Maryland more than 90 days before the date of the sale of the property, and
  • not qualified by or registered with SDAT to do business in Maryland more than 90 days before the date of the sale of the property.

In the case of multiple owners, withholding is required from each of the nonresident owners based on the percentage of the total payment that represents each nonresident's ownership percentage.

At settlement, you must complete Form MW506NRS, Return of Income Tax Withholding for Nonresident Sale of Real Property. The settlement agent must then present Copies A and B of Form MW506NRS to the clerk or SDAT, along with payment.

In addition to filing Form MW506NRS with a tax withholding payment, you are still required to file an end-of-the-year income tax return with Maryland for the year in which the sale occurred.

For more information, see Maryland's Withholding Requirements for Sales or Transfers of Real Property and Associated Personal Property by Nonresidents.

If you are a nonresident who owns and is selling or transferring real property and associated tangible personal property in Maryland, you must make a tax withholding payment to the local Clerk of the Circuit Court or the Maryland Department of Assessments and Taxation (SDAT). The payment must be made before the deed or other instrument of transfer is recorded with the court clerk or filed with SDAT.

Generally, the person responsible for your closing, a title company for example, is responsible for ensuring that sufficient funds are withheld at settlement and for paying the amount of withholding tax due to the Clerk or SDAT when the deed or other instrument of transfer is presented for recordation.

For a nonresident individual, the payment is 7.5% of the total property sale payment made to the individual. A nonresident entity must make an 8.25% payment.

Under this provision, a nonresident entity is an entity that is:

  • not formed under the laws of Maryland more than 90 days before the date of the sale of the property, and
  • not qualified by or registered with SDAT to do business in Maryland more than 90 days before the date of the sale of the property.

In the case of multiple owners, withholding is required from each of the nonresident owners based on the percentage of the total payment that represents each nonresident's ownership percentage.

At settlement, you must complete Form MW506NRS, Return of Income Tax Withholding for Nonresident Sale of Real Property. The settlement agent must then present Copies A and B of Form MW506NRS to the clerk or SDAT, along with payment.

In addition to filing Form MW506NRS with a tax withholding payment, you are still required to file an end-of-the-year income tax return with Maryland for the year in which the sale occurred.

For more information, see Maryland's Withholding Requirements for Sales or Transfers of Real Property and Associated Personal Property by Nonresidents.

You are entitled to claim qualified exemptions on your Maryland return. The amount of your Maryland exemption may be limited by the amount of your federal adjusted gross income. See chart below.

The personal exemption is $3,200. This exemption is reduced once your federal adjusted gross income exceeds $100,000 ($150,000 if filing Joint, Head of Household, or Qualifying Widow(er) with Dependent Child).

If Your federal AGI is Single or Married Filing Separately Joint, Head of Household or Qualifying Widow(er) Dependent Taxpayer (eligible to be claimed on another taxpayer's return
Your Exemption is Your Exemption is Each Exemption is

$100,000 or less

$3,200

$3,200

$0

Over But not over

 

 

 

$100,000

$125,000

$1,600

$3,200

$0

$125,000

$150,000

$800

$3,200

$0

$150,000

$175,000

$0

$1,600

$0

$175,000

$200,000

$0

$800

$0

In excess of $200,000

$0

$0

$0

You must complete the Exemptions section of the return with Form 502B if completing the Form 502. Complete the EXEMPTIONS area on Form 502. Form 502B must be completed and attached to Form 502 if you are claiming one or more dependents.

Age and Blindness

In addition to the exemptions allowed on your federal return, you and your spouse may claim an additional $1,000 exemption on the Maryland return for being 65 years of age or older or blind. If any other dependent claimed is 65 or over, you also receive an extra exemption of up to $3,200.

Make sure you check both boxes in the Exemptions section for each of your dependents who are age 65 or over. Make sure you check both boxes (4) and (5) of the Dependent Form 502B for each of your dependents who are age 65 or over.

502B - Dependents Form

Enter the names, Social Security numbers and relationships for all dependents on Form 502B. The total dependent exemptions should be carried over to part C of the Exemptions section on Form 502.

Part-Year Residents and Military

If you are a part-year resident or a member of the military, you must prorate your exemptions based on the percentage of your income subject to Maryland tax. See Instructions 26 and 29 in the Maryland tax booklet.

Nonresidents

If you and your spouse file a joint federal return but choose to file separate Maryland returns because one of you is a nonresident, each spouse's personal exemption amounts must be claimed separately as well.

You may be eligible to claim some valuable personal income tax credits available on your Maryland tax return.

The following list contains general information about some of the most commonly used credits. You may want to consult with a tax professional to review specific requirements. Some of these credits contain carryover or recapture provisions and, in some cases, you may have to seek certification from another state agency. For more information, see Form 502CR

State Department of Assessments and Taxation Credits

Tax Credits for Homeowners and Renters

A credit is allowed for cost of new aquaculture oyster floats that are designed to grow oysters at or under an individual homeowner's pier. The devices must be buoyant and assist in the growth of oysters for the width of the pier. The credit amount is limited to the lesser of the individual's state tax liability for that year or the maximum allowable credit of $500.

If the credit is more than the tax liability, the unused credit may not be carried forward to another tax year.

To claim the credit, you must complete Part D of Form 502CR and attach to your Maryland income tax return. You must also report the credit on Maryland Form 502, 505 or 515.

If you were eligible for a Child and Dependent Care Credit on your federal income tax return, Form 1040 or 1040A for the tax year, you may be entitled to a credit on your Maryland state income tax return. The credit starts at 32% of the federal credit allowed, but is phased out for taxpayers with federal adjusted gross incomes above $92,000. No credit is allowed for an individual whose federal adjusted gross income exceeds $143,000. This credit is in addition to the subtraction modification available on the Maryland return for child and dependent care expenses.

To claim the credit, you must complete Part B of Form 502CR and submit with your Maryland income tax return. You must report the credit on Maryland Form 502, 505 or 515

You can use the tables below to determine the percentage of the federal credit that can be claimed on your Maryland return:

  • Find the correct decimal amount that applies to your FAGI in the appropriate table.
  • Multiply your FAGI by the decimal amount.
  • Complete your Maryland return through the line labeled "Maryland Tax."
  • Complete Form 502CR, following the instructions provided.
  • Submit your completed Form 502CR with your Maryland return.

If the credit is more than your tax liability, the unused credit may not be carried forward to another tax year.

CREDIT FOR CHILD AND DEPENDENT CARE EXPENSES CHART
If your filing status is Married Filing Separately and your federal adjusted gross income is: Decimal Amount For all other filing statuses, if your federal adjusted gross income is:
At least But less than   At least But less than
$0 $30,001 .3200 $0 $50,001
$30,501 $32,001 .3100 $50,001 $53,001
$32,001 $34,501 .3000 $53,001 $56,001
$34,501 $36,001 .2900 $56,001 $59,001
$36,001 $38,501 .2800 $59,001 $62,001
$38,501 $40,001 .2700 $62,001 $65,001
$40,001 $42,501 .2600 $65,001 $68,001
$42,501 $44,001 .2500 $68,001 $71,001
$44,001 $46,501 .2400 $71,001 $74,001
$46,501 $48,001 .2300 $74,001 $77,001
$48,001 $50,001 .2200 $77,001 $80,001
$50,001 $52,001 .2100 $80,001 $83,001
$52,001 $54,001 .2000 $83,001 $86,001
$54,001 $56,001 .1900 $86,001 $89,001
$56,001 $58,001 .1800 $89,001 $92,001
$58,001 $60,001 .1700 $92,001 $95,001
$60,001 $62,001 .1600 $95,001 $98,001
$62,001 $64,001 .1500 $98,001 $101,001
$64,001 $66,001 .1400 $101,001 $104,001
$66,001 $68,001 .1300 $104,001 $107,001
$68,001 $70,001 .1200 $107,001 $110,001
$70,001 $72,001 .1100 $110,001 $113,001
$72,001 $74,001 .1000 $113,001 $116,001
$47,001 $76,001 .0900 $116,001 $119,001
$76,001 $78,001 .0800 $119,001 $122,001
$78,001 $80,001 .0700 $112,001 $125,001
$80,001 $82,001 .0600 $125,001 $128,001
$82,001 $84,001 .0500 $128,001 $131,001
$84,001 $86,001 .0400 $131,001 $134,001
$86,001 $88,001 .0300 $134,001 $137,001
$88,001 $90,001 .0200 $137,001 $140,001
$90,001 $92,001 .0100 $140,001 $143,001
$92,001 or over .0000 $143,001 or over

Maryland provides two separate tax benefits for child or dependent care costs: a subtraction that reduces your taxable income and a tax credit that reduces the amount of tax you owe.

Subtraction

The state subtraction benefit, which is claimed on Form 502, reduces your taxable income. If you have eligible child or dependent care expenses, first determine your federal tax credit by completing the calculation on federal Form 2441. Transfer the amount of child or dependent care expenses (not the federal tax credit) claimed on line 6 of the federal form to line 9 of Maryland Form 502. You can subtract actual expenses up to the legal maximums of $3,000 for one child or $6,000 for two or more children.

Tax credit

The tax credit, which is claimed on Form 502CR, reduces the amount of tax you owe. If you were eligible for a child and dependent care credit on your federal income tax return, you may be entitled to a tax credit on your Maryland income tax return.

The tax credit does not affect the treatment or eligibility of the state tax subtraction for child care costs.

For more information about the tax credit, see above Child and Dependent Care Tax Credit

If you contribute to the Maryland Prepaid College Trust, the Maryland College Investment Plan or the Maryland Broker-Dealer Investment Plan, you may claim a subtraction on the Maryland income tax return, using Form 502 for full or part-year residents or Form 505 for nonresident individuals by filing Form 502SU or Form 505SU.

You may be able to claim up to $2,500 per contract purchased for advanced tuition payments made to the Maryland Prepaid College Trust or up to $2,500 per taxpayer per beneficiary for the total of all amounts contributed to investment accounts for the same beneficiary under the Maryland College Investment Plan and the Maryland Broker-Dealer College Investment Plan.

If you have contributed more than $2,500 during the taxable year, the excess may be carried over to each subsequent succeeding tax year until the full amount of the initial contribution is allowed as a subtraction for the Maryland Prepaid College Trust or until used to the next 10 succeeding taxable years for the College Investment Plan.

You may be able to take a subtraction on the amount included in federal adjusted gross income contributed by the State into an investment account under § 18-19A-04.1 of the Education Article during the taxable year. This includes amounts included in federal adjusted gross income contributed by the State into an investment account under the Maryland College Investment Plan.

An addition on the Maryland income tax return must be claimed for any refunds of advanced tuition payments made under the Maryland Prepaid College Trust, to the extent the payments were subtracted from federal adjusted gross income and were not used for qualified higher education expenses, and any refunds of contributions made under the Maryland College Investment Plan or the Maryland Broker-Dealer College Investment Plan, to the extent the contributions were subtracted from federal adjusted gross income and were not used for qualified higher education expenses.

For more information, see Administrative Release 32 - Maryland Prepaid College Trust and Maryland College Investment Plan Tax Benefits and College Savings Plans of Maryland.

If you qualify for the federal earned income tax credit and claim it on your federal return, you may be entitled to a Maryland earned income tax credit on the state return equal to 50% of the federal tax credit. However, If you do not meet the minimum age requirement under the federal credit and are otherwise eligible for the federal credit for those without a qualifying child, you may claim the state earned income tax credit (calculate federal earned income credit disregarding the minimum age requirement). The Maryland earned income tax credit (EITC) will either reduce or eliminate the amount of the state and local income tax that you owe.

For tax year 2018, the earned income tax credit is allowed if you meet the following conditions:

  • You have three or more qualifying children and you earn less than $49,194 ($54,884 if married filing jointly).
  • You have two qualifying children and you earn less than $45,802 ($51,492 if married filing jointly).
  • You have one qualifying child and you earn less than $40,320 ($46,010 if married filing jointly).
  • You do not have a qualifying child and you earn less than $15,270 ($20,950 if married filing jointly).

To calculate the amount of your tax credit, complete the State Earned Income Credit Worksheet included in Instruction 18 of the Maryland tax booklet.

If you are a Maryland resident, you may qualify for the Maryland earned income tax credit even if you're not required to file a Maryland tax return. For tax years beginning after 12/31/2014, nonresidents may no longer claim any earned income credit.

Refundable Earned Income Tax Credit

If the earned income tax credit exceeds your Maryland tax liability, you may be entitled to a refund. Complete the Refundable Earned Income Credit Worksheet in Instruction 21 of the resident tax booklet.

For tax year 2018, the refundable earned income credit is calculated as 28% of your federal earned income credit, less your state income tax liability. If this amount is zero or less, no refund is due. The refundable amount of the credit may not be carried forward to any other tax year.

Local Earned Income Tax Credit

If you are a Maryland resident who qualifies for the state earned income credit, you may also qualify for a local earned income tax credit. Complete the Local Earned Income Credit Worksheet included in Instruction 19 of the tax booklet. The unused local income tax credit may not be refunded or carried forward to any other tax year.

Nonresidents, Part-Year Residents

Part-year residents must prorate their earned income credits on Form 502, based on the ratio of Maryland adjusted gross income to federal adjusted gross income. For tax years beginning after 12/31/2014, nonresidents may no longer claim any earned income credit.

Free Tax Preparation

Free tax preparation services are available at Volunteer Income Tax Assistance (VITA) sites to help low- and moderate-income taxpayers file their federal and Maryland income tax returns free of charge. Trained volunteers will prepare your returns, make sure you claim all the tax credits to which you are entitled, and even file your returns electronically - for free.

To find a VITA site in your area, call 410-685-0525 or 1-800-492-0618. Hearing impaired individuals can call TTY 410-685-2159. When calling, please indicate if you plan to file for a prior tax year.

Additionally, if you earned less than $54,000, you may qualify for free tax preparation through the CASH Campaign of Maryland. You can call 1-800-492-0618 for more information.

Maryland Taxpayer Service Offices

In addition, if you bring a completed copy of your federal return and all related documents to any of our taxpayer service offices, we will complete your Maryland income tax return and even file it electronically for you for free. Our offices are open Monday - Friday, 8:30 a.m. - 4:30 p.m.

Helpful Resources

EITC Central
Individuals Taxpayer Assistance
Maryland Family Network
CASH Campaign of Maryland

As of June 1, 2010, the Sustainable Communities Tax Credit replaces the Heritage Structure Rehabilitation Credit.

A credit may be allowed for substantial expenditures incurred in a 24-month period to rehabilitate a certified heritage structure located in Maryland. The credit is available for owner-occupied residential property, as well as income-producing property. Credits may not be authorized after June 30, 2010.

How the credit is calculated:

The credit is 20% of the total expenditures incurred during the 24 month rehabilitation period. For the rehabilitation of commercial structures, the credit cannot be more than the maximum amount specified under the initial credit certificate, which is based on estimated expenditures. If the application was submitted to MHT before June 1, 2002, the credit based on actual expenditures can be up to $250,000 more than the amount shown on the initial credit certificate.

The credit is claimed in the year in which the rehabilitation is completed; however, it cannot be claimed until the Part 3 certification is approved.

For property certified before July 1, 2001, a business could have received a mortgage credit certificate. In lieu of taking the credit, the certificate may be transferred to the mortgage holder who may then take a credit against their income tax in an amount equal to the face value of the certificate.

For certifications received after June 30, 2001, the amount in excess of the state tax liability can be refunded.

Credits for tax years 2002 and later are limited to $3 million. For non-commercial properties, the credit is $50,000 per property for applications received by MHT after June 30, 2004.

The rehabilitation of a structure that received approval by the MHT on or before February 1, 2001, is subject to the provisions of the law in effect prior to the 2002 legislative changes.

The MHT will not accept applications for the approval of plans for commercial rehabilitations if a substantial part of the work has been completed if the applicant has already submitted three or more applications for a combined total of more than $500,000 in that year.

The total amount of credits approved by MHT for properties located in certain areas of the state during each fiscal year is subject to certain limitations.

A pro-rated percentage of the credit is subject to recapture if disqualifying work is performed during a five-year period, beginning with the year in which the certified rehabilitation was completed.

Contact:

Maryland Historical Trust
100 Community Place
Crownsville, MD 21032-2023
Phone: 410-514-7628

If you are a Maryland resident (including a resident fiduciary) and you paid income tax to another state, you may be eligible for a credit on your Maryland return. Nonresidents (filing Form 505, 515 or 504) are not eligible for this credit.

Find the state to which you paid a nonresident tax in the groups listed below. The instructions for that group will tell you if you are eligible for credit and should complete Part A of Form 502CR.

You must file your Maryland income tax return on:

  • Form 502 and complete lines 1 through 22 of that form; or
  • Form 504 and complete lines 1 through 23.

Then complete Form 502CR Parts A and G and attach to Form 502 or 504. A completed, signed copy of the income tax return filed in the other state must also be attached to Form 502 or 504.

Group I - Maryland Residents

A Maryland resident (including a resident fiduciary) having income from one of these states must report the income on the Maryland return Form 502 or 504. To claim a credit for taxes paid to another state, complete Form 502CR and attach it and a copy of the other state's nonresident income tax return to your Maryland return.

Alabama - AL Massachusetts - MA Pennsylvania - PA (except wage income)
Arizona - AZ Michigan - MI Rhode Island - RI
Arkansas - AR Minnesota - MN South Carolina - SC
California - CA Mississippi - MS Tennessee - TN
Colorado - CO Missouri - MO Texas - TX
Connecticut - CT Montana - MT Utah - UT
Delaware - DE Nebraska - NE Vermont - VT
Georgia - GA New Hampshire - NH Virginia - VA (except wage income)
Hawaii - HI New Jersey - NJ Washington, DC - DC (except wage income)
Idaho - ID New Mexico - NM West Virginia- WV (except wage income)
Illinois - IL New York - NY Wisconsin - WI
Indiana - IN North Carolina -NC Territories and Possessions of the United States
Iowa - IA North Dakota - ND American Samoa - AS
Kansas - KS Ohio - OH Guam - GU
Kentucky - KY Oklahoma - OK Northern Mariana Island - MP
Louisiana - LA Oregon - OR Puerto Rico - PR
Maine - ME   U.S. Virgin Islands - VI

Group II - Reciprocal States

Maryland has a reciprocal agreement with the following states:

  • Pennsylvania - PA
  • Virginia - VA
  • Washington, DC - DC
  • West Virginia - WV

Group III - No state income tax

No state income tax - No credit allowed.

  • Alaska - AK
  • Florida - FL
  • Nevada - NV
  • South Dakota - SD
  • Washington - WA
  • Wyoming - WY

Dual Residents

A person may be a resident of more than one state at the same time for income tax purposes. If you must file a resident return with both Maryland and another state, use the following rules to determine where the credit should be taken: 

  1. A person who is domiciled in Maryland and who is subject to tax as a resident of any of the states listed in Group I or II can claim a credit on the Maryland return (Form 502) using Part A of Form 502CR.
  2. A person domiciled in any state listed in Group I or II who must file a resident return with Maryland must take the credit in the state of domicile.

Capital gains installment sales

You may be allowed a credit for tax paid to another state when a capital gain is recognized in the current year on the federal return, but was taxed by another state in an earlier year. The gain must have resulted from the sale of a personal residence located in another state or from an installment sale. The credit equals the amount of the gain multiplied by the highest state tax rate used on your Maryland tax return or the personal income tax rate in the other state in the year in which the state taxes the gain, whichever is less.

If the credit exceeds your tax liability, the unused credit may not be carried forward to any other tax year.

If you purchase a long-term care insurance contract for yourself or certain members of your family, you may be eligible for a one-time credit of up to $500 for each insured.

Qualifications

To qualify for the credit, the insured must be all of the following:

  • A spouse, parent, stepparent, child or stepchild.
  • A Maryland resident.
  • Not covered by long-term care insurance before July 1, 2000.
  • Not claimed the credit for the insured by another taxpayer this year.
  • Not claimed the credit for the insured by anyone in any other tax year.

For the current tax year, you can claim a credit equal to the premiums paid, up to a maximum of $420 for each insured person 40 years of age or younger, and up to a maximum of $500 for each insured person 41 or older.

This tax credit must not have been claimed for the insured by another taxpayer in this year or anyone else in any other tax year. If the credit exceeds the tax liability, the unused credit may not be carried forward to any other tax year.

Claiming the credit

To claim the credit, you must complete Part E of Form 502CR, and attach it with your Maryland Income Tax Return (Form 502, 505 or 515). 

If your earned income and federal adjusted gross income plus additions are below the poverty level income for the number of persons in family/household on your federal tax return, you may be eligible for the poverty level credit. You are not eligible for this credit if you checked filing status 6 (dependent taxpayer) on your Maryland income tax return. 

Generally, if your Maryland state tax exceeds 50% of your federal earned income credit and your earned income and federal adjusted gross income are below the poverty income guidelines from the worksheet, you may claim a credit of 5% of your earned income. This is not a refundable credit.

The tax credit can be claimed on Maryland forms 502, 505 or 515.

If you checked filing status 6 on your Maryland return, you are not eligible for this credit.

1. Enter the amount from line 7 of Form 502. If you checked filing status 3 (married filing separately) and you filed a joint federal return enter your joint federal adjusted gross income plus any  Maryland additions 1.________________
2. Enter the total of your salary, wages, tips and other employee compensation and net profit from self-employment. (Do not include a farm or business loss). 2.________________
3. Find the number of persons in your family/household from the chart that is the same as the number of persons entered on your federal tax return. Enter the income level that corresponds to the number of persons. 3.________________
4. Enter the amount from line 1 or 2, whichever is larger. Compare lines 3 and 4. If line 4 is greater than or equal to line 3, STOP HERE. You do not qualify for this credit. If line 3 is greater than line 4, continue to line 5. 4.________________
5. Multiply line 2 by 5% (.05). This is your State Poverty Level Credit. Enter that amount on line 23 of Form 502. 5.________________
Poverty Income Guidelines
Number of Persons in Family/Household Income Level
1 $12,140
2 $16,460
3 $20,780
4 $25,100
5 $29,420
6 $33,740
7 $38,060
8 $42,380
For families/households with more than 8 persons, add $4,0 for each additional person.

If the amount on line 3 is greater than the amount on line 4, you are eligible to claim the local poverty level credit. Complete this worksheet to calculate the amount of your credit.

A. ENTER the amount from line 2 of the State Poverty Level Credit Worksheet A.________________
B. ENTER your local tax rate based on where you live. See Local Tax Rate Chart. B. 0.0___ ___ ___
C. MULTIPLY line A by line B. Enter the amount on line 30 of Form 502. C.________________

To claim the credit:

  • Complete your Maryland return up to the line on the form labeled "Maryland tax."
  • Complete the State Poverty Level Credit Worksheet included in Instruction 18 of the tax booklet and the Local Poverty Level Credit Worksheet in Instruction 19.
  • Enter the state and local credit amounts on the appropriate lines of your Maryland return.

If you are a nonresident or a part-year resident, you must prorate the credits based on the ratio of your Maryland adjusted gross income to your federal adjusted gross income. See Instruction 26(o) in the Maryland tax booklet for more information.

If the credit exceeds your tax liability, the unused credit may not be carried forward to any other tax year.

If you purchase a long-term care insurance contract for yourself or certain members of your family, you may be eligible for a one-time credit of up to $500 for each insured.

Qualifications

To qualify for the credit, the insured must be all of the following:

  • A spouse, parent, stepparent, child or stepchild.
  • A Maryland resident.
  • Not covered by long-term care insurance before July 1, 2000.
  • Not claimed the credit for the insured by another taxpayer this year.
  • Not claimed the credit for the insured by anyone in any other tax year.

For the current tax year, you can claim a credit equal to the premiums paid, up to a maximum of $420 for each insured person 40 years of age or younger, and up to a maximum of $500 for each insured person 41 or older.

This tax credit must not have been claimed for the insured by another taxpayer in this year or anyone else in any other tax year. If the credit exceeds the tax liability, the unused credit may not be carried forward to any other tax year.

Claiming the credit

To claim the credit, you must complete Part E of Form 502CR, and attach it with your Maryland Income Tax Return (Form 502, 505 or 515). 

If you donated an easement to the Maryland Environmental Trust or the Maryland Agricultural Land Preservation Foundation to preserve open space, natural resources, agriculture, forest land, watersheds, significant ecosystems, view sheds or historic properties, you may be eligible for a tax credit.

You may be eligible for the credit if:

  1. the easement is perpetual;
  2. the easement is accepted and approved by the Board of Public Works; and
  3. the fair market value of the property before and after the conveyance of the easement is substantiated by a certified real estate appraiser.

The credit is equal to the difference in the fair market values of the property reduced by payments received for the easement. The credit amount is limited to the lesser of the individual's state tax liability for that year of the maximum allowable credit of $5,000, per owner, who qualifies to claim the credit. The credit can be claimed on Maryland forms 502, 504, 505 or 515

If the property is owned jointly by more than one individual such as a husband and wife, each individual owner is entitled to the credit based on their percentage of ownership. Individual members of a pass-through entity are not eligible for this credit.

In the case of a joint return, each spouse must calculate their own state tax liability for limitation purposes. Use the rules for filing separate returns in Instruction 8 of the Maryland resident tax booklet. In the case of a fiduciary return, the fiduciary will complete the column for Taxpayer B only.

If the individual's allowable credit amount exceeds the maximum of $5,000, the excess may be carried forward up to 15 years or until fully used. Complete lines 1-7 of Part F on Form 502CR. If you itemize deductions, see Instruction 14 in the Maryland resident tax booklet.

For more information, contact:

Maryland Environmental Trust
100 Community Place, 1st Floor
Crownsville, MD 21032
410-514-7900
dnr.maryland.gov/met/

Maryland Agricultural Land Preservation Foundation
50 Harry S. Truman Parkway
Annapolis, MD 21401
410-841-5860
mda.maryland.gov/malpf/
 

If you are a qualified teacher, you may be able to claim a credit against your State tax liability for tuition paid to take graduate-level courses required to maintain certification. This credit applies to individuals who:

  • Currently hold a standard professional certificate or an advanced professional certificate;
  • Are employed by a county/city board of education in Maryland, a state or local correctional facility, or a juvenile correctional facility as listed below in the note;
  • Teach in a public school or qualified facility and receive a satisfactory performance;
  • Successfully complete the graduate courses with a grade of B or better; and
  • Have not been fully reimbursed by the state/county/city for these expenses.

Note: Qualified juvenile facilities are: the Alfred D. Noyes Children's Center; the Baltimore City Juvenile Justice Center; the Charles H. Hickey, Jr. School; the Cheltenham Youth Facility; the J. DeWeese Carter Center; the Lower Eastern Shore Children's Center; the Thomas J.S. Waxter Children's Center; the Victor Cullen Center; the Western Maryland's Children's Center; and the youth centers.

Only the unreimbursed portion qualified for the credit. The courses taken must be required to maintain certification and the cost of the courses must exceed any amount reimbursed by the county or Baltimore City.

The maximum amount of credit allowed is $1,500 for each qualifying individual. The credit is limited to the amount paid, less any reimbursement, up to the maximum allowed credit. See Page 3 of the Instructions for Form 502CR to learn how to calculate the credit. Each spouse that qualifies may claim this credit. Complete a separate column on Form 502CR Part C for each spouse.

The credit can be claimed on Maryland forms 502, 505 or 515

If the credit exceeds your tax liability, the unused credit may not be carried forward to any other tax year.

If you received a grant under Maryland's Residential Clean Energy Grant Program to install a qualifying solar energy system and the grant was reported to you on a 1099G form and included in your federal adjusted gross income, you may be able to subtract the grant amount from your taxable income on the Maryland income tax return. The subtraction amount cannot exceed your total income.

To claim the subtraction, enter the amount that was reported to you on a 1099G form on Maryland Form 502 and enter code letters "ee" in the code letter box.

The Residential Clean Energy Grant Program is administered by the Maryland Energy Administration and provides funding for a portion of the costs to install certain qualifying solar energy systems.

Grants are allocated on a first come/ first served basis across technologies and are subject to changes in amount and existence based on funding availability.

For more information on clean energy grants, contact:

Maryland Energy Administration
1800 Washington Blvd, Suite 755
Baltimore, MD 21230
Telephone: 410-537-4000
E-mail: cegp.mea@maryland.gov

If you and your spouse have taxable income and are filing a joint federal return, you may be able to subtract up to $1,200, or the income of the spouse with the lower income (whichever is less) on your Maryland income tax return.

The benefit is available only on the Maryland return and it applies to wages, pensions or business income.

You should enter the subtraction amount on line 14 of Form 502. The following worksheet from Instruction 13, Line 14 of the Maryland tax booklet will help you calculate the subtraction.

Two-Income Married Couple Subtraction Worksheet
  (a) You (b) Your Spouse
1. ENTER the portion of federal adjusted gross income from line 1 of Form 502 attributable to each spouse.    
2. ENTER the portion of additions to income from line 6 of Form 502 attributable to each spouse.    
3. ADD lines 1 and 2    
4. ENTER the portion of subtractions from income from lines 8-13 of Form 502 attributable to each spouse    
5. SUBTRACT line 4 from line 3    
6. COMPARE the amounts on lines 5 (a) and (b) and enter the smaller amount here but not less than zero.    
7. ENTER $1,200 or the amount on line 6, whichever is less. ENTER this amount on line 14 of Form 502.    

The Student Loan Debt Relief Tax Credit may be claimed on Form 502CR by certain qualified taxpayers in the amount certified by the Maryland Higher Education Commission. Note: A copy of the required certification from the Maryland Higher Education Commission must be included with Form 502CR. "Qualified taxpayer" means an individual who has incurred at least $20,000 in undergraduate student loan debt and has at least $5,000 in outstanding undergraduate student loan debt when submitting an application for certification to the Maryland Higher Education Commission. The amount of any tax credit approved by the Maryland Higher Education Commission may not exceed $5,000. The refundable tax credit must be claimed against the State income tax for the taxable year in which the Maryland Higher Education Commission certifies the tax credit. Individuals applying for certification should submit an application to the Maryland Higher Education Commission by September 15th of each year. The Maryland Higher Education Commission shall prioritize tax credit recipients and amounts based on qualified taxpayers who:

(1) Have higher debt burden to income ratios;
(2) Graduated from an institution of higher education located in Maryland;
(3) Did not receive a tax credit in a prior year; or
(4) Were eligible for in-state tuition.

The credit shall be recaptured if the individual does not use the credit approved under this section for the repayment of the individual's undergraduate or graduate student loan debt within 2 years from the close of the taxable year for which the credit is claimed. The individual who claimed the credit shall pay the total amount of the credit claimed as taxes payable to the State for the taxable year in which the event requiring recapture of the credit occurs.

For more information contact:

Maryland Higher Education Commission
6 North Liberty Street
Baltimore, MD 21201
Phone: (410) 767-4859 or (800) 974-0203
mhec.maryland.gov

Donors that make a donation to a qualified permanent endowment fund held at an eligible institution of higher education may be eligible for a credit against the Maryland State income tax. The tax credit terminates December 31, 2023.

To qualify for the credit

Cash donations made by the taxpayer to a qualified permanent endowment fund that meet certain requirements are eligible for tax credits. Donations must be made to a qualifying fund at any of the following institutions: Bowie State University, Coppin State University, Morgan State University, or University of Maryland Eastern Shore. In each tax year, the Comptroller may award a maximum of $60,000 in tax credits to each of the four institutions.

How the credit is calculated

The credit is 25% of the value of a proposed donation to a qualified permanent endowment fund. The donor must apply to the Comptroller of Maryland for a certification of the donation.

Credit application procedure

Donors seeking the tax credit must apply to the Comptroller for a tax credit certificate in the calendar year that the donation is made.

Applications must be sent by e-mail and are approved on a first-come, first-serve basis until the maximum amount of authorized credits have been approved.

For tax year 2019, the HBCU Tax Credit Application will be accepted beginning July 1, 2019 at 8 a.m.

An acknowledgement letter is issued when an application for the proposed donation is received. Donors are required to submit documentation from the institution showing proof of donation within 30 days before a final tax credit certificate is issued.

Where to send applications

Applications are accepted by e-mail only; and should be sent to HBCUtaxinfo@marylandtaxes.gov

All fields on the application are required to be completed fully. Incomplete applications will not be processed.

How the credit is claimed

Donors claim the credit by including the certification at the time the Maryland income tax return is filed. Individuals that are eligible to claim the income tax credit and are not PTE members may elect to claim the credit using Form 502CR, instead of Form 500CR. However, a donor may not claim the credit on both Form 500CR and Form 502CR. PTE members that are eligible for the credit must claim it on the Business Income Tax Credit Form 500CR. Corporations and Fiduciaries that are eligible to claim the credit must use Form 500CR to do so.

A taxpayer claiming the credit is required to add back the amount of the credit claimed to Maryland adjusted gross income or Maryland modified income, to the extent excluded from federal adjusted gross income.

Contact

Comptroller of Maryland

HBCU Tax Credit Office

HBCUtaxinfo@marylandtaxes.gov

Businesses or individuals who make a donation to a qualified permanent endowment fund at an eligible community foundation may be eligible for a credit against the Maryland State income tax.

The credit may be taken against corporate income tax, personal income tax, insurance premiums tax or public service company franchise tax. However, the same credit may not be applied to more than one tax type.

To qualify for the credit:

Donations of $500 or more of cash or publicly traded securities made by the taxpayer to a "qualified permanent endowment fund" at an "eligible community foundation" that meets certain requirements are eligible for tax credits. Individuals and businesses may claim a maximum of $50,000 in credits per year, representing a donation of no more than $200,000.

The taxpayer must apply to the Maryland Department of Housing and Community Development (DHCD) for a certification for the donation.

For any tax year, the sum of all Endow Maryland tax credits, including any carryover credits, may not exceed the lesser of $50,000 or the total amount of tax otherwise payable by the individual and/or business for the tax year. Excess credits may be carried over for five (5) years.

How the credit is calculated:

The credit is 25% of the value of the approved donation. Each business or individual may claim a credit of up to $50,000. Businesses and individuals claim the Endow Maryland Tax Credit by filing an electronic tax return supporting Business Income Tax Credit Form 500CR. An electronic return must be filed to claim this credit against the Maryland income tax. See exception below.

Exception: Individuals who are eligible to claim the Endow Maryland Tax Credit, and who are not PTE members may elect to claim this credit on Part I of Form 502CR, instead of claiming the credit on Part V of Form 500CR. Taxpayers electing to use Form 502CR to claim the Endow Maryland Tax Credit are not required to file their return electronically.  However, an individual may not claim this credit on both Form 500CR and Form 502CR. PTE members who are eligible for this credit must claim the credit on Business Income Tax Credit Form 500CR.

Individuals who anticipate having a carryover of the Endow Maryland Tax Credit are advised to use Form 500CR instead of Form 502CR.

See Form 500CR Instructions for specific line-by-line instructions. Form 500CR must still be filed electronically.

Add Back required:

Whenever the Endow Maryland Tax Credits are claimed against the income tax, an addition modification must be included for the amount deducted as a donation to the extent that the amount of donation is included in an application for the Endow Maryland Tax Credit.

Documentation required:

A copy of the required approval from the Department of Housing and Community Development DHCD must be attached to the appropriate electronic Maryland Income Tax Return - Form 500 for Corporations, Form 510 and Form 510 Schedule K-1 for Pass-Through Entities, and Form 502 for individuals, electing to use Form 500CR. The Form 500CR section of the electronic return must also be completed.

A copy of the required approval from the DHCD must be attached to Form 502 for those individuals, electing to use Form 502CR.

Contact:

Department of Housing and Community Development
Division of Neighborhood Revitalization
2 N. Charles St., Suite 450
Baltimore, MD 21202
Phone: 410-209-5800
E-mail: endowmaryland.nr@maryland.gov

If you are 65 or older, you can take advantage of several tax benefits on your Maryland return. You are allowed a higher income level before being required to file a return, and you are entitled to an additional personal exemption of $1,000. You may also qualify for a pension exclusion that increases each year, and your Social Security and Railroad Retirement benefits are not subject to Maryland tax.

As a senior citizen, one of the tax benefits you enjoy is a higher income allowance before you are required to file a Maryland income tax return. You are required to file a return if your gross income exceeds the amount listed for your filing status.

For example, if you and your spouse are both 65 or older, are planning to file jointly, and you received less than $27,000 in gross income during 2019, you do not have to file a Maryland return.

For more information, see above Filing Requirement for Seniors.

What is Maryland's state income tax rate?

For tax year 2019, Maryland's graduated personal income tax rates start at 2.00% on the first $1,000 of taxable income and increase up to a maximum of 5.75% on incomes exceeding $300,000. Nonresidents are subject to a special nonresident tax rate of 1.75%, in addition to the state income tax rate. For more information, see Maryland Income Tax Rates and Brackets.

How is the local income tax calculated?

The local income tax is calculated as a percentage of your taxable income. Local officials set the rates, which range between 1.75% and 3.20% for tax year 2019.

Your local income tax is based on where you live. Be sure to use the correct rate for your local jurisdiction. For more information, see Local Tax Rates.

What's important to know about personal exemptions?

If you have a federal adjusted gross income of up to $100,000 (up to $150,000 if filing jointly) you are entitled to a $3,200 exemption on the Maryland return for each exemption you are qualified to claim on the federal return. For taxpayers with higher incomes, the exemption amount is limited. See the Exemption Amount Chart included in Instruction 10 of the Maryland tax booklet.

You and your spouse may claim an additional $1,000 exemption on the Maryland return for being 65 years of age or older or blind. If any other dependent claimed is 65 or over, you also receive an extra exemption of up to $3,200.

Make sure you check both boxes in columns 6 and 7 of the Exemptions section for each of your dependents who are age 65 or over. After you complete the Exemptions section, enter your total exemption amount on your Maryland return.

What benefits are available for two-income couples?

Married senior citizens who both receive wages, interest, pension, business or other kinds of income can subtract up to $1,200 or the income of the spouse, whichever is less.

You can use the Two-Income Married Couple Subtraction Worksheet in Instruction 13 of the Maryland resident tax booklet to help calculate the correct subtraction amount for your situation.

Does Maryland tax Social Security benefits?

No. Taxpayers affected by the federal tax on Social Security and/or Railroad Retirement benefits can continue to exempt those benefits from state tax. Maryland tax law exempts from state tax only those Railroad Retirement benefits provided under the U.S. Railroad Retirement Act. Enter on line 11 of Maryland Form 502 all Railroad Retirement benefits and/or Social Security benefits that were taxable on your federal return and included on line 1 of Maryland Form 502.

Can I claim Maryland's pension exclusion?

If you are 65 or older or totally disabled (or your spouse is totally disabled), you may be able to subtract some of your taxable pension and retirement annuity income. Maryland's maximum pension exclusion is $31,100. Carefully review the age and disability requirements in Instruction 13 of the Maryland resident tax booklet.

This subtraction applies only if:

  • You were 65 or older or totally disabled, or your spouse was totally disabled, on the last day of the tax year; and
  • You included on your federal return income received as a pension, annuity or endowment from an "employee retirement system." Please note that these include qualified defined benefit and defined contribution pension plans, 401(a) plans, 401(k) plans, 403(b) plans, and 457(b) plans.
  • A traditional IRA, a Roth IRA, a simplified employee plan (SEP), a Keogh Plan or an ineligible deferred compensation plan does not qualify.

If you are not eligible for the standard pension exclusion above and you are a retired correctional officer, law enforcement officer or fire, rescue, or emergency services personnel, you may still qualify for a pension exclusion of up to $15,000 if you meet the following requirements: 

  1. You were 55 or over on the last day of the tax year, AND
  2. You were not 65 or older, or totally disabled, or have a spouse who is totally disabled, AND
  3. You included on your federal return taxable income received as a pension, annuity or endowment from an employee retirement system. Please note that these include qualified defined benefit and defined contribution pension plans, 401(a) plans, 401(k) plans, 403(b) plans, and 457(b) plans of the Internal Revenue Code, AND
  4. The retirement income is attributable to your service as correctional officer, a law enforcement officer or fire, rescue, or emergency services personnel of the United States, the State of Maryland, or a political subdivision of Maryland.

Instruction 13 of the Maryland resident tax booklet provides further details on claiming the subtraction.

For more information, see Maryland's Pension Exclusion.

Does Maryland offer a tax break for long-term care insurance?

If you purchase a long-term care insurance contract for yourself or certain members of your family, you may be eligible for a one-time credit of up to $500 for each insured. To qualify for the credit, the insured must be all of the following:

  • A spouse, parent, stepparent, child or stepchild.
  • A Maryland resident;
  • Not covered by long-term care insurance before July 1, 2000.
  • Not have the credit for the insured being claimed by another taxpayer.
  • Not have the credit claimed by anyone in any other tax year.

For tax year 2017, you can claim a credit equal to the premiums paid, up to a maximum of $410 for each insured person 40 years of age or younger, and up to a maximum of $500 for each insured person over the age of 40.

This tax credit must not have been claimed for the insured by another taxpayer in this year or anyone else in any other tax year. If the credit exceeds the tax liability, the unused credit may not be carried forward to any other tax year.

Claiming the credit

To claim the credit, you must file Maryland Form 502, 505 or 515. Complete Part E of Form 502CR and include Form 502CR with your return.

Is there a special tax benefit for military retirees?

If you or the spouse of a military retiree receives military retirement income, you will be able to subtract up to $5,000 of your military retirement income from your federal adjusted gross income before determining your Maryland tax. Beginning with tax year 2015, if you are age 65 or over, you will be able to subtract up to $10,000 of the military retirement income.

The retirement income must have been received as a result of any of the following military service:

  • Induction into the U.S. armed forces for training and service under the Selective Training and Service Act of 1940 or a subsequent Act of similar nature.
  • Membership in a reserve component of the U.S. armed forces.
  • Membership in an active component of the U.S. armed forces.
  • Membership in the Maryland National Guard.

The benefit also applies to persons separated from active duty employment with the commissioned corps of the Public Health Service, the National Oceanic and Atmospheric Administration, or the Coast and Geodetic Survey. For more information, see Military Retirement Income.

I am retired from the federal government. Can I have state tax withheld from my pension?

Yes. You can arrange for Maryland taxes to be withheld from your federal pension by visiting Retirement Services Online provided by the U.S. Office of Personnel Management. You can also obtain tax withholding assistance from the U.S. Office of Personnel Management by telephone at 1-888-767-6738 or by e-mail at retire@opm.gov.

As a senior citizen, one of the tax benefits you enjoy is a higher income allowance before you are required to file a Maryland income tax return. You are required to file a return if your gross income exceeds the amount listed below for your filing status. These requirements apply to both resident and nonresident taxpayers. Do not include income from Social Security or Railroad Retirement benefits when determining your gross income.

Minimum Filing Levels for Taxpayers Age 65 or Older
Tax Year 2019
Filing Status Gross Income
Single, 65 or older $13,850
Joint return,
one spouse 65 or older
$25,700
Joint return,
both spouses 65 or older
$27,000
Married filing separately,
regardless of age
$12,200
Head of household, 65 or older $20,000
Qualifying widow(er), 65 or older $25,700

If you or your spouse is 65 or over or blind, you are entitled to an extra $1,000 personal exemption, in addition to the regular personal exemption that you may be entitled to. If you have a federal adjusted gross income of up to $100,000 (up to $150,000 if filing jointly) you are entitled to a $3,200 exemption on the Maryland return. For taxpayers with higher incomes, the exemption amount is limited. See the Exemption Amount Chart included in Instruction 10 of the Maryland Resident tax booklet.

You must complete the Exemptions section of the return to determine your total exemption allowance. Enter the number of exemptions in the appropriate boxes based upon your entries in parts A, B, and C of the Form 502. Make sure you check both boxes in columns 6 and 7 of the Exemptions section for each of your dependents who are age 65 or over on Form 502B. Enter your total exemption allowance on line 19 of Form 502.

As a federal government retiree, you can have state tax withheld from your pension.

The U.S. Office of Personnel Management provides an online service for retirees to begin, change or stop the withholding of Maryland income taxes from your annuity.

You can also obtain tax withholding assistance from the U.S. Office of Personnel Management by telephone at 1-888-767-6738 or by e-mail at retire@opm.gov.

Be sure to have your CSA or CSF retirement claim number handy - and your Social Security number - when contacting the office.

If you are 65 or older or totally disabled (or your spouse is totally disabled), you may qualify for Maryland's maximum pension exclusion of $31,100 under the conditions described in Instruction 13 of the Maryland resident tax booklet. If you're eligible, you may be able to subtract some of your taxable pension and retirement annuity income from your federal adjusted gross income.

This subtraction applies only if:

  1. You were 65 or older or totally disabled, or your spouse was totally disabled, on the last day of the tax year; and
  2. You included on your federal return income received as a pension, annuity or endowment from an "employee retirement system." Please note that these include qualified defined benefit and defined contribution pension plans, 401(a) plans, 401(k) plans, 403(b) plans, and 457(b) plans.
  3. A traditional IRA, a Roth IRA, a simplified employee plan (SEP), a Keogh Plan or an ineligible deferred compensation plan does not qualify.

Complete the Pension Exclusion Computation Worksheet shown in Instruction 13 in the Maryland resident tax booklet. Be sure to report all benefits received under the Social Security Act and/or Railroad Retirement Act on line 3 of the pension exclusion worksheet - not just those benefits you included in your federal adjusted gross income.

To receive the benefit of the pension exclusion, be sure to transfer the amount from line 5 of the worksheet to line 10a of Form 502, and complete the remainder of your return, following the line-by-line instructions.

Pension Exclusion for Retired Correctional Officer, Law Enforcement Officer or Fire, Rescue, and Emergency Services Personnel

Note: An individual taxpayer may not claim BOTH the standard Pension Exclusion and the Pension Exclusion for Retired Correctional Officer, Law Enforcement Officer or Fire, Rescue, or Emergency Services Personnel.

If you are 65 or older on the last day of the calendar year, you are totally disabled, or your spouse is totally disabled, and you have received qualified pension income, you should complete the Pension Exclusion Computation Worksheet (13A) regardless of your prior work history. It is permissible for one spouse to claim the standard Pension Exclusion and the other spouse to claim the Pension Exclusion for Retired Correctional Officer, Law Enforcement Officer or Fire, Rescue, or Emergency Services Personnel if each spouse meets the applicable required criteria.

If you meet the below criteria, use the Retired Correctional Officer, Law Enforcement Officer or Fire, Rescue, or Emergency Services Personnel Pension Exclusion Worksheet (13E) to calculate your eligible pension exclusion:

  1. You were 55 or over on the last day of the tax year, AND
  2. You were not 65 or older, or totally disabled, or have a spouse who is totally disabled, AND
  3. You included on your federal return taxable income received as a pension, annuity or endowment from an employee retirement system. Please note that these include qualified defined benefit and defined contribution pension plans, 401(a) plans, 401(k) plans, 403(b) plans, and 457(b) plans qualified under Section 401(a), 403 or 457(b) of the Internal Revenue Code, AND
  4. The retirement income is attributable to your service as a correctional officer, law enforcement officer or fire, rescue, or emergency services personnel of the United States, the State of Maryland, or a political subdivision of Maryland.

Each spouse who meets the above requirements may be entitled to the exclusion. If each spouse is eligible, complete a separate column on the Retired Correctional Officer, Law Enforcement Officer or Fire, Rescue, or Emergency Services Personnel Pension Exclusion Worksheet (13E). Combine your allowable exclusions from line 8 of the worksheet and enter the total amount on line 10b of Form 502.

If you or the spouse of a military retiree receives military retirement income, you will be able to subtract up to $5,000 of your military retirement income including death benefits from your federal adjusted gross income before determining your Maryland tax. Beginning with tax year 2018, if you are age 55 or older, you will be able to subtract up to $15,000 of the military retirement income including death benefits.

The retirement income must have been received as a result of any of the following military service:

  • Induction into the U.S. armed forces for training and service under the Selective Training and Service Act of 1940 or a subsequent Act of similar nature.
  • Membership in a reserve component of the U.S. armed forces.
  • Membership in an active component of the U.S. armed forces.
  • Membership in the Maryland National Guard.

The benefit also applies to persons separated from active duty employment with the commissioned corps of the Public Health Service, the National Oceanic and Atmospheric Administration, or the Coast and Geodetic Survey.

To claim the benefit, complete Form 502 and follow the instructions included in the resident tax booklet for line 13. Be sure to indicate code letter u on line 13.

Pension exclusion

If you are a retired military member 65 years of age or older, you may also qualify for Maryland's pension exclusion.

Married senior citizens who both receive wages, interest, pension, business or other kinds of income that are subject to Maryland tax can subtract up to $1,200 or the income of the spouse, whichever is less.

You can use the Two-Income Married Couple Subtraction Worksheet in Instruction 13 of the Maryland resident tax booklet to help calculate the correct subtraction amount for your situation.

Maryland does not tax Social Security and/or Railroad Retirement benefits. If you receive Social Security benefits and/or Railroad Retirement benefits and any amount of those benefits is included in your federal adjusted gross income, you can exempt those benefits from state and local tax in these easy steps:

  • Determine the taxable amount of Social Security and/or Railroad Retirement benefits that were included in your federal adjusted gross income on line 1 of Maryland Form 502.
  • Subtract those taxable benefits on line 12.
  • Complete the remainder of your return, following the line-by-line instructions.

If you also are eligible for Maryland's pension exclusion, be sure to report all of your Social Security and/or Railroad Retirement benefits on line 3 of the pension exclusion computation worksheet - not just those benefits you included in your federal adjusted gross income.

The Comptroller's Office will no longer accept the federal Form 2848 or federal Form 8821 as power of attorney forms for Maryland tax purposes.

Please use one of the following forms:

Maryland Form 548 (Power of Attorney)
Maryland Form 548 Instructions
Maryland Form 548P (Reporting Agent Authorization)

We will continue to accept a durable power of attorney or any other power of attorney form authorized by Maryland law.

The completed Maryland Form 548 should include all identifying information for the taxpayer including:

  • Name(s)
  • Address
  • Social Security number(s)
  • Signature(s)
  • Date

The tax representative or appointed authority authorized to have power of attorney and to receive and inspect confidential tax information for the taxpayer must specify on the form the representative's name, mailing address, daytime telephone number, signature and  designation item number (1-10).  The Maryland Form 548 must also be filed with government-issued identification for the taxpayer (not the representative) unless the representative's designation is item number 1, 2 or 3.

The tax matters to be discussed by the taxpayer's representative with power of attorney must include the following information:

  • Type of Maryland tax (income, employment)
  • Maryland tax form number (502, MW506)
  • Year(s) or period(s) covered

If the power of attorney form does not include all the information as instructed it will not be accepted.

The power of attorney form shall be valid until superseded, revoked or by the death of the taxpayer(s) or representative(s).

Tax information can be disclosed to the appropriate party possessing power of attorney if the "Check Here" box on the appropriate form (Form 502, Form 505, etc.) has been marked. This authority extends to the estimated payments made for the subsequent tax year.

There is no such thing as a "Verbal POA". If a taxpayer calls and their representative is present the taxpayer can give permission for the representative to speak to us at that time. However, the approval is for that phone call at that time only.

Volunteer Income Tax Preparation Organizations V.I.T.A/A.A.R.P/T.C.E

Volunteers can use Maryland Form 548 and Maryland Form 548P with no PTIN. All information will still be required in order to accept the POA. They should clearly indicate on the form the volunteer organization with whom they are affiliated.

Power of attorney forms can be mailed, faxed or scanned and e-mailed.

If mailing the forms they can be sent to:

Comptroller of Maryland
Revenue Administration Division
P.O. Box 1829
Attn: POA
Annapolis, Maryland 21404-1829

If faxing the forms they can be faxed to 410-260-6213.

If scanning and e-mailing the forms they can be e-mailed to RADPOA@marylandtaxes.gov

For more information about power of attorney matters, call 410-260-7424, Monday - Friday, 8:30 a.m. - 4:30 p.m. You can also e-mail related inquiries to taxprohelp@marylandtaxes.gov

Free tax preparation

You can call or visit any of our taxpayer service offices to receive free state tax assistance. If you bring a completed copy of your federal return and all related documents to any of our offices, we will complete your Maryland income tax return and even file it electronically for you - free of charge.

Volunteer Income Tax Assistance, Tax Counseling for the Elderly

We also work closely with IRS to help support the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs which offer free tax preparation services to elderly taxpayers with low or moderate incomes. We help train VITA and TCE volunteers in preparation for each tax filing season.

The IRS works with the following sponsors to administer the program in Maryland:

If you are a legal resident of Maryland and serving in the military, you must file a resident Maryland tax return, regardless of where you are stationed. You must also report all of your taxable income from all sources, including military pay.

The wages earned by a spouse of a nonresident U.S. servicemember may be exempt from Maryland income tax under the Military Spouses Residency Relief Act, when the spouse of the servicemember is not a legal resident of Maryland. The income tax withholding exemption may be claimed by filing a revised Form MW507 with their employer. Beginning 2011, you must also complete and attach Form MW507M. For more information, see Employer Withholding Tax Alert- Important Information for Spouses of U.S. Military Servicemembers and Administrative Release 1: Military Personnel and Civilian Spouses - Both Residents and Nonresidents of Maryland

Military service may entitle you to special tax breaks for overseas pay and retirement income. The following links offer more information about helpful tax benefits and other unique filing situations that affect military families in Maryland.

Forms and Worksheets for Military Personnel

Form MW507
Form MW507M
Military Overseas Income Worksheet
Military Worksheet A: compute the adjustment to the standard deduction or itemized deductions as well as exemptions for local tax.
Military Worksheet B: compute the local tax for a civilian spouse taxpayer.

You must file a Maryland resident return Form 502 if:

  • You are a legal resident of the state of Maryland (your home of record). You are taxed on all of your income from all sources, wherever earned.
  • You are not a resident of Maryland but your civilian spouse is employed in Maryland and has resided within the state for more than six months. For more information about this situation, see Civilian Spouse Employed in Maryland.

You must file a Maryland nonresident return Form 505 and Form 505NR if:

  • Either you or your spouse has non-military income earned in Maryland. The tax should be calculated on Maryland earned income only. Deductions and exemptions must be apportioned using the ratio of Maryland income to Federal adjusted gross income.
  • Your civilian spouse is employed in Maryland and has resided in Maryland for less than six months.
  • You and your spouse are in the military, do not live in Maryland and one or both have Maryland income.

You do NOT need to file a Maryland return if:

  • You and/or your spouse are legal residents of another state and neither you nor your spouse has earned non-military income in the state of Maryland.
  • You and/or your spouse are legal residents of another state and have military income and other income earned outside of Maryland.

Tax credits

You may be eligible for Maryland income tax credits as well as tax credits granted by another state. See Maryland Form 502CR and instructions. Follow the instructions provided by your state of legal residence for any possible credits allowed by that state.

If you are a legal Maryland resident and a member of the military, you must file a resident Maryland income tax return, using Form 502, and report all income from all sources, wherever earned. You do not lose your resident status if you are stationed outside of Maryland during the taxable year.

Local income tax

Resident military personnel who develop a state income tax liability in Maryland are also liable for the local income tax. As a resident, you are subject to the local income tax regardless of whether you were stationed in Maryland or not.

Retirement income

If you are a retired member of the military, you may be able to subtract up to $5,000 of your military retirement income from your federal adjusted gross income before determining your Maryland tax.

Overseas pay

If you earned active duty income overseas outside the U.S. boundaries or possessions, you may be able to subtract up to $15,000 in overseas pay.

Estimated taxes

You or your civilian spouse must file estimated tax returns if your estimated Maryland taxable income not subject to employer withholding results in a tax liability exceeding $500. For more information, see Estimated Taxes. For more information about the filing situation for military residents in Maryland, see Instruction 29 in the Maryland resident tax booklet.

If you are a legal resident of another state but are stationed in Maryland, your military income is not subject to Maryland income tax. However, you will be taxed as a nonresident on any portion of federal adjusted gross income that was derived from any real or personal property that is located in Maryland as well as non-military income earned in Maryland, including income from Maryland lottery prizes.

Military income only

If you are a nonresident with military income only, you do not have to file a Maryland income tax return.

Military income and other income outside Maryland

If you are a nonresident with military income only - or military income and other income earned outside of Maryland - you do not have to file a Maryland income tax return.

Military and other income earned in Maryland, single or with an unemployed civilian spouse

If you are a nonresident with military income and other income earned in Maryland, single, or have an unemployed spouse, you must file a nonresident Maryland Form 505, reporting total income and subtracting military pay. You must also file Form 505NR, subtracting unearned and non-Maryland income, then computing the Maryland taxable net income. In addition, you must adjust your exemptions and deductions. The State of Maryland does not tax the military pay, and does not use the military pay to increase the tax liability imposed on other income earned in Maryland.

Military income with or without other income earned in Maryland, and civilian spouse employed in Maryland

See Administrative Release 1 - Military Personnel and Civilian Spouses - Both Residents and Nonresidents of Maryland for guidance and application of the Military Spouses Residency Relief Act, amending the Servicemembers Civil Relief Act.

Both spouses in the military and not domiciled in Maryland and one or both have Maryland income

If you and your spouse are in the military and not domiciled in Maryland, and one or both have Maryland income, you must file a joint nonresident return. You must also adjust your exemptions and deductions.

The wages earned by a spouse of a nonresident U.S. servicemember may be exempt from Maryland income tax under the Military Spouses Residency Relief Act, when the spouse of the servicemember is not a legal resident of Maryland. The income tax withholding exemption may be claimed by filing a revised Form MW507 with their employer. Beginning in 2011, you must also complete and attach Form MW507M. For more information, see Employer Withholding Tax Alert: Important Information for Spouses of U.S. Military Servicemembers and Administrative Release 1: Military Personnel and Civilian Spouses - Both Residents and Nonresidents of Maryland

As the military spouse, you remain a nonresident for purposes of Maryland taxation, and are not required to file a Maryland return, unless you received non-military income from Maryland sources. You may choose to file a joint resident return using Form 502, or your civilian spouse may file a separate resident return.

Filing separately

If your civilian spouse files a separate resident return then you are not required to file a Maryland return, unless you received non-military income from Maryland sources. See Instruction 8 in the resident tax booklet.

Filing jointly

If you file a joint return, report your total federal adjusted gross income on your Maryland return. Subtract military pay and the military taxpayer's portion of any investment income (interest, dividends, etc.) from the joint federal adjusted gross income, on the line for nonresident income.

Local income tax

The military taxpayer's Maryland income is not subject to the local income tax. Enter the word "MILITARY" on line 33. Standard or itemized deductions and exemptions must be adjusted, using a ratio of Maryland adjusted gross income to federal adjusted gross income. You should use the Military Worksheet A to compute the adjustment to the standard deduction or itemized deductions as well as exemptions. Use Military Worksheet B to compute the local tax for the civilian taxpayer.

If you are not certain which filing status to use, figure your tax both ways to determine the best status for you. For more information, see Instruction 26 in the resident booklet.

Maryland allows the same six-month extension for filing and paying personal income taxes for military and support personnel serving in a designated combat zone or qualified hazardous duty area as allowed by IRS. The extension also applies to individuals who serve in the combat zone in support of U.S. armed forces.

The extension applies to the filing of current tax returns, back year returns, estimated tax returns, amended returns or appeals to a Maryland Tax Court.

Hospitalization

If you are hospitalized as a result of injuries sustained in a combat zone, you qualify for the extension since hospitalization is considered as service in a combat zone.

Spouses

Spouses also qualify for the extension whether joint or separate returns are filed. There are two exceptions concerning hospitalization and termination of the combat zone designation. See the IRS Web site at www.irs.gov

Code 912

If you are affected by the extension, you should enter 912 in the code number box near the signature area on your Maryland return. For more information about the combat zone provision, visit the IRS Web site at www.irs.gov

If you are a legal Maryland resident and a member of the U.S. armed forces who earned military pay while in active service outside U.S. boundaries or possessions, you may subtract up to $15,000 of that military pay from your taxable income.

If your total military pay exceeds $30,000, you do not qualify for this subtraction. You can use the Military Overseas Income Worksheet included in Instruction 13 of the Maryland tax booklet to compute the subtraction. For more information, see code p of Instruction 13.

If you or the spouse of a military retiree receives military retirement income, you will be able to subtract up to $5,000 of your military retirement income including death benefits from your federal adjusted gross income before determining your Maryland tax. Beginning with tax year 2018, if you are age 55 or older, you will be able to subtract up to $15,000 of the military retirement income including death benefits.

The retirement income must have been received as a result of any of the following military service:

  • Induction into the U.S. armed forces for training and service under the Selective Training and Service Act of 1940 or a subsequent Act of similar nature.
  • Membership in a reserve component of the U.S. armed forces.
  • Membership in an active component of the U.S. armed forces.
  • Membership in the Maryland National Guard.

The benefit also applies to persons separated from active duty employment with the commissioned corps of the Public Health Service, the National Oceanic and Atmospheric Administration, or the Coast and Geodetic Survey.

To claim the benefit, complete Form 502 and follow the instructions included in the resident tax booklet for line 13. Be sure to indicate code letter u on line 13.

Pension exclusion

If you are a retired military member 65 years of age or older, you may also qualify for Maryland's pension exclusion.

To change your legal residence as a member of the military, you must:

  • Intend to establish new residence in a specific jurisdiction.
  • Remove yourself from the previously held jurisdiction.
  • Establish a new, permanent place of abode in the new jurisdiction.
  • Complete Form DD 2058 State of Legal Residence Certificate.
  • Contact your legal officer.

The Comptroller's Office will no longer accept the federal Form 2848 or federal Form 8821 as power of attorney forms for Maryland tax purposes.

Please use one of the following forms:

Maryland Form 548 (Power of Attorney)
Maryland Form 548 Instructions
Maryland Form 548P (Reporting Agent Authorization)

We will continue to accept a durable power of attorney or any other power of attorney form authorized by Maryland law.

The completed Maryland Form 548 should include all identifying information for the taxpayer including:

  • Name(s)
  • Address
  • Social Security number(s)
  • Signature(s)
  • Date

The tax representative or appointed authority authorized to have power of attorney and to receive and inspect confidential tax information for the taxpayer must specify on the form the representative's name, mailing address, daytime telephone number, signature and designation item number (1-10). The Maryland Form 548 must also be filed with government-issued identification for the taxpayer (not the representative) unless the representative's designation is item number 1, 2 or 3.

The tax matters to be discussed by the taxpayer's representative with power of attorney must include the following information:

  • Type of Maryland tax (income, employment)
  • Maryland tax form number (502, MW506)
  • Year(s) or period(s) covered

If the power of attorney form does not include all the information as instructed it will not be accepted.

The power of attorney form shall be valid until superseded, revoked or by the death of the taxpayer(s) or representative(s).

Tax information can be disclosed to the appropriate party possessing power of attorney if the "Check Here" box on the appropriate form (Form 502, Form 505, etc.) has been marked. This authority extends to the estimated payments made for the subsequent tax year.

There is no such thing as a "Verbal POA". If a taxpayer calls and their representative is present the taxpayer can give permission for the representative to speak to us at that time. However, the approval is for that phone call at that time only.

Volunteer Income Tax Preparation Organizations V.I.T.A/A.A.R.P/T.C.E

Volunteers can use Maryland Form 548 and Maryland Form 548P with no PTIN. All information will still be required in order to accept the POA. They should clearly indicate on the form the volunteer organization with whom they are affiliated.

Power of attorney forms can be mailed, faxed or scanned and e-mailed.

If mailing the forms they can be sent to:

Comptroller of Maryland
Revenue Administration Division
P.O. Box 1829
Attn: POA
Annapolis, Maryland 21404-1829

If faxing the forms they can be faxed to 410-260-6213.

If scanning and e-mailing the forms they can be e-mailed to RADPOA@marylandtaxes.gov

For more information about power of attorney matters, call 410-260-7424, Monday - Friday, 8:30 a.m. - 4:30 p.m. You can also e-mail related inquiries to taxprohelp@marylandtaxes.gov

Purchases made by veterans organizations and their auxiliary units are exempt from Maryland sales tax if the purchases are made for the organization's exempt purposes.

The exemption became effective on July 1, 2006. Exemption certificates issued to qualifying veterans' organizations will expire on September 30, 2017. The new exemption certificate is a white card with green printing, bearing the organization's eight-digit exemption number.  Certificates are renewed every five (5) years.

The organizations or their auxiliaries or units must possess a 501(c)(19) letter of determination from IRS as evidence of qualification for the exemption. For more information on obtaining a letter of determination from IRS, visit the IRS Web site.

To apply for an exemption certificate, print a copy of Combined Registration Application and submit the completed application with a copy of the 501(c)(19) letter of determination, articles of incorporation and bylaws. The application may also be obtained by calling Taxpayer Service at 410-260-7980, or toll-free 1-800-638-2937 from elsewhere in Maryland, Monday - Friday, 8:30 a.m. - 4:30 p.m. EDT

We offer several ways for you to obtain Maryland tax forms, booklets and instructions:

  1. Download them. You can download forms using the links listed below.
  2. Request forms by e-mail. You can also e-mail your forms request to us at taxforms@marylandtaxes.gov
  3. Visit our offices. Visit any of our taxpayer service offices to obtain forms.

You can also file your Maryland return online using our free iFile service.

Request A Copy of Previously Filed Tax Returns

To request a copy of a Maryland tax return you filed previously, send us a completed Form 129 by mail or by fax. Please include your name, address, Social Security number, the tax year you are requesting and your signature. If you are requesting a copy of a joint return, include the information for both taxpayers and their signatures.

Mailing address:
Revenue Administration Division
Central Files
110 Carroll Street
Annapolis, MD  21411
Fax: 410-974-2967

We offer several ways for you to obtain Maryland tax forms, booklets and instructions:

  1. Download them. You can download tax forms using the links listed below.
  2. Request forms by e-mail. You can also e-mail your forms request to us at taxforms@marylandtaxes.gov.
  3. Visit our offices. Visit any of our taxpayer service offices to obtain forms.

You can also file your Maryland return online using our free iFile service.

Choose the Right Income Tax Form

Your residency status largely determines which form (paper or electronic) you will need to file for your personal income tax return.

If you are a Maryland resident, you can file long Form 502 and 502B if your federal adjusted gross income is less than $100,000.

If you lived in Maryland only part of the year, you must file Form 502.

If you are a nonresident, you must file Form 505 and Form 505NR.

If you are a nonresident and need to amend your return, you must file Form 505X.

If you are a nonresident employed in Maryland but living in a jurisdiction that levies a local income or earnings tax on Maryland residents, you must file Form 515.

Special situations

If you are self-employed or do not have Maryland income taxes withheld by an employer, you can make quarterly estimated tax payments as part of a pay-as-you-go plan, using Form PV. Please refer to Payment Voucher Worksheet (PVW) for estimated tax and extension payments instructions.

If you owe additional Maryland tax and are seeking an automatic six-month filing extension, you must file Form PV along with your payment by April 15, 2019. You should file Form PV only if you are making a payment with your extension request.

If you need to make certain changes to your original Maryland return that has already been filed and processed, you must file Form 502X for 2018 to amend your original tax return. 

Individual Tax Forms and Instructions

Below you will find links to individual income tax forms and instructions from tax year 2012 through the current year.

Withholding Forms

Local Tax Rate Changes - For tax year 2018, Cecil County has increased its rate to 3.00%. For tax year 2019 Caroline County has increased its rate to 3.2%. Please note the rate on 2019 Form PV.

Sales and Use Tax Forms

We are no longer automatically sending you a paper coupon booklet for Sales and Use Tax returns. You can file your Sales and Use tax returns through our bFilesystem. If you would like to continue receiving paper coupons you can request them by e-mailing IwantmySUTcoupons@marylandtaxes.gov or you can mail your request to Comptroller of Maryland Revenue Administration Division P.O. Box 1829 Annapolis, MD, 21404.

Offers in Compromise Forms and Instructions

When you complete Form MD 656, you should address all of the reasons you believe you cannot, or should not, pay the full amount due. You should offer an amount you are able to pay. A mere unwillingness to pay will not excuse you. We will consider the following circumstances when deciding whether or not to accept your offer in compromise:

  • Doubt as to liability. If you believe you don't owe the amount due, you must include with Form MD 656 a detailed explanation of the reason(s) you believe you do not owe the tax.
  • Insufficient resources. If you don't have enough assets or income to pay the full amount, you must include with Form MD 656 a complete financial statement, Form MD 433-A for individuals and/or Form MD 433-B for businesses.
  • Economic or other hardship. If you have enough assets to pay the full amount, but believe that because of your exceptional circumstances requiring full payment would cause an economic hardship or would be unfair and inequitable, you must include with Form MD 656 a complete financial statement, Form MD 433-A and/or Form MD 433-B.

Submit Form MD 656 and MD 433-A and/or MD 433-B to:

Offer in Compromise Program
Comptroller of Maryland
301 West Preston Street, Room 203
Baltimore, Maryland 21201

To follow-up on the status of an Offer in Compromise submitted for individual income tax please call 410-974-2432 from Central Maryland or 1-888-674-0016 from elsewhere. To follow-up on the status of an Offer in Compromise submitted for business tax (sales and use tax, withholding tax, corporate income tax, etc.) please call 410-649-0633 from Central Maryland or 1-888-614-6337 from elsewhere.

For more information about the Offer in Compromise Program, email us at cdoic@marylandtaxes.gov or call 410-767-1555 from Central Maryland or 1-888-674-0020 from elsewhere.

Forms:

Offer in Compromise

Collection Information Statement

Using Downloadable Forms

In order to view .PDF files you need a .PDF reader supported by your devices operating system.

PDF for Windows

If you do not already have Adobe Acrobat Reader installed on your computer, you will need to do so in order to view tax forms, instruction guides, and other .PDF files on our Web sites.

Occasionally, .PDF files such as tax forms, worksheets, and instructions may not open automatically in your Internet browser. If you encounter this problem, you must first download and save the file to your computer before viewing it. Upon saving the file to your hard drive, you may view the file by opening it with the Adobe Acrobat Reader software.

PDF for Safari on Mac

Use the newest Safari Version: Visit https://support.apple.com/downloads/#safari

Using the Safari Built in Viewer: using Safari version 5.1.X or higher, and you get a blank screen on your Mac when you try to open .PDFs in Safari, you need to install Adobe plug-ins installed that are older than version 10.1.3.  To do so:

  1. Backup your Mac
  2. Press and hold COMMAND + TAB to bring up your Mac's application switcher, 
  3. Click TAB key, while still holding down the COMMAND key, until the selector lands on "Finder" 
  4. Release the COMMAND and TAB keys.
  5. Click on the "Go" menu at the top of the screen.
  6. Select "Go to folder" 
  7. Copy and paste the folder path into the pop-up window: "/Library/Internet Plug-ins".  A new folder window will open, showing a list of all the browser plug-ins installed.  You should see one, or more files with, AdobePDFViewer. Sort alphabetically if you need to.
  8. Drag the old Adobe plug-ins into the Trash
  9. Quit and restart Safari
  10. Try opening a PDF in Safari again and yes, it should work, using Safari's own "native" PDF reader.

Using the newest Adobe PDF Viewer Plug-in in Safari:

Tax Forms Containing 2-D Barcodes

Adobe Reader for Mobile (Android, iPhone, iPad)

For information about Adobe Reader on mobile platforms, visit https://www.adobe.com/products/reader-mobile.html

General Instructions for downloading .PDF Files

The following instructions explain how to download a file from our Web site and view it using ADOBE Acrobat Reader.

  1. Position your mouse pointer over the form you wish to download.
  2. Right-click on the link (press the right button on your mouse).
  3. Select "Save target as..." or "Save link as..." from the drop-down menu.
  4. In the "Save as..." window, select the location on your computer where you want to store the file, and click "OK".
  5. The download should start. Once it is complete, open the file with Adobe Acrobat Reader.

Formas para Individuos

Usted puede bajar las formas e instrucciones en español aqu� sobre los Impuestos del Ingreso para individuos.

Nota: Los folletos del impuesto no contienen las formas de impuesto. Las formas de impuesto est�n disponibles por separado en esta p�gina del Web, por a�o.

La oficina del Comptroller se ha esforzado con la traducci�n de nuestras formas e instrucciones.- si hubiese alg�n error en la comprensi�n o traducci�n, la version de las formas en Ingl�s prevalecer�n.

Las formas de impuestos del 2014 versi�n en espa�ol estar�n disponibles despu�s del 1o de Enero

Formas Relativas

Request A Copy of Previously Filed Tax Returns

To request a copy of a Maryland tax return you filed previously, send us a completed Form 129 by mail or by fax. Please include your name, address, Social Security number, the tax year you are requesting and your signature. If you are requesting a copy of a joint return, include the information for both taxpayers and their signatures.

Mailing address:
Revenue Administration Division
Central Files
110 Carroll Street
Annapolis, MD  21411
Fax: 410-974-2967

Mailing Instructions

The return address for a Form 502 or Form 505 filed with payment by check or money order is:

Comptroller of Maryland
Payment Processing
PO Box 8888
Annapolis, MD 21401-8888

Send all other returns, payments and other correspondence regarding your personal or business tax account(s) to:

Comptroller of Maryland
Revenue Administration Division
PO Box 549
Annapolis, MD 21411-0001

The following information on your correspondence will help us generate a quick response to your inquiry:

Individual Taxpayers

Please include your name, address, a contact number and the last four digits of Social Security number on all correspondence. Be sure to include your full Social Security number on tax returns.

Make checks and money orders payable to Comptroller of Maryland. We also recommend you include your Social Security number on your check or money order.

Business Taxpayers

Please include your business name, address and your nine-digit federal employer identification number (FEIN) and eight-digit Maryland Central Registration (CR) number on your returns and correspondence.

You can use your Maryland income tax return to contribute money to protect our state's natural resources, support people with developmental disabilities, and support cancer research.

Your contribution will reduce the amount of your state refund or increase the amount of additional state tax you owe.

However, any contribution you make to the Chesapeake Bay and Endangered Species Fund, Developmental Disabilities Services and Support Fund, and the Maryland Cancer Fund is tax deductible for the year the contribution was made, if you itemize deductions.

Chesapeake Bay and Endangered Species Fund

You may contribute any amount you wish to the Chesapeake Bay and Endangered Species Fund, using line 35 of Form 502, line 26 of Form 504, or line 39 of Form 505.

Contributions to this fund support projects to restore wetlands, plant trees and protect threatened plants and animals. The donations are divided evenly between the Chesapeake Bay Trust and the Wildlife and Heritage Division of the Maryland Department of Natural Resources.

Developmental Disabilities Services and Support Fund

You may contribute any amount you wish to this fund, using line 36 on Form 502, line 27 on Form 504 or line 40 of Form 505. Contributions to the Developmental Disabilities Services and Support Fund help provide vital support to children and adults with disabilities such as autism, cerebral palsy, and Down syndrome. Services include support to families, job training and employment for adults, support to live in the community and crisis intervention. 

Maryland Cancer Fund

You may contribute any amount you wish to the Maryland Cancer Fund , using line 15 on Form 503, line 28 on Form 504 or line 41 on Form 505. Contributions to the Maryland Cancer Fund support grants for cancer research, prevention and treatment.

Fair Campaign Financing Fund

You may contribute any amount you wish to this fund.  The amount contributed will reduce your refund or increase your balance due.  Use Line 38 on Form 502 or Line 41 on Form 505 or Line 25 on Form 504.

Only for gubernatorial campaigns.  

A change of address request for personal taxes must come from you in writing, and it must include your Social Security Number, your old address, your new address, and your signature.

Change of Address Form for Individuals

A change of address for business taxes must include the Federal Identification Number (FEIN) and the Maryland Central Registration Number (CR), old address, new address and your signature.

Change of Address Form for Businesses

Send your request to:

COMPTROLLER OF MARYLAND
REVENUE ADMINISTRATION DIVISION
TAXPAYER IDENTIFICATION
110 CARROLL STREET
ANNAPOLIS MD 21411-0001