Maryland’s local taxes by county come in two main forms: a local income tax that every county and Baltimore City must charge at a rate between 2.25% and 3.20% of Maryland taxable income, and property taxes that range from roughly $0.80 to $2.248 per $100 of assessed value for fiscal year 2026. Two people with identical incomes and identical homes can owe noticeably different totals depending on which county they live in. Unlike many states, Maryland does not let counties add their own sales tax, so that piece stays uniform at 6% statewide.1Comptroller of Maryland. Maryland Sales and Use Tax 6% Rate Chart
Local Income Tax Rates by County
State law requires all 23 counties and Baltimore City to impose a local income tax, and the rate each jurisdiction picks must fall between a floor of 2.25% and a ceiling of 3.20% of your Maryland taxable income.2Maryland General Assembly. Maryland Tax – General Code Section 10-106 – County Income Tax Rate Allegany County sits at the statutory minimum of 2.25%. Several counties, including Garrett and Worcester, tax at the full 3.20%.3Maryland Comptroller’s Office. 2025 Maryland State and Local Income Tax Withholding Information Most of the state falls somewhere in between.
Rate changes take effect on January 1. A county pushing its rate above 2.6% has to hold a public hearing first and publish notice in a local newspaper for two consecutive weeks.2Maryland General Assembly. Maryland Tax – General Code Section 10-106 – County Income Tax Rate Howard County can only change its rate by ordinance rather than by simple resolution.
Since 2022, counties have also had the option to apply local income tax on a bracket basis instead of a single flat rate. A county using brackets can set different rates for different income levels as long as no rate drops below 2.25% or climbs above 3.20%.2Maryland General Assembly. Maryland Tax – General Code Section 10-106 – County Income Tax Rate Frederick County and Howard County are among the jurisdictions that have moved to a graduated structure, so your effective rate there depends on where your income lands within the county’s brackets.
Who Actually Owes the Local Income Tax
The rate only matters once you know which county’s rate applies to you, and that turns on residency rather than where you work.
Residents
If you’re domiciled in Maryland on the last day of the tax year, you owe local income tax to the county or city where you live. You can also qualify without being domiciled here. Maryland treats you as a statutory resident if you keep a place of abode in the state for more than six months of the year and are physically present in Maryland for 183 days or more during the same year.4Comptroller of Maryland. Administrative Release No. 37 – Maryland Income Tax – Domicile and Residency Both conditions have to be met.
When domicile is contested, the Comptroller looks at concrete ties: voter registration, vehicle titles, where your children go to school, and where you keep bank accounts.
Non-Residents Working in Maryland
If you live in another state but earn income in Maryland, you don’t pay a county income tax. Instead you pay a special non-resident tax equal to the lowest county rate in effect that year, which is currently 2.25%.5Maryland General Assembly. Maryland Tax – General Code Section 10-106.1 – Individuals Subject to State Tax but Not County Tax It’s built into the 7.0% total withholding rate Maryland employers apply to non-resident paychecks.3Maryland Comptroller’s Office. 2025 Maryland State and Local Income Tax Withholding Information
Part-Year Residents
Moving into or out of Maryland during the year means filing as a part-year resident. Your local rate is set by the county where you lived on the last day of your Maryland residency.6Comptroller of Maryland. 2025 Resident Instruction Booklet Deductions, exemptions, and credits are prorated using a Maryland income factor: Maryland adjusted gross income divided by total federal AGI for the year.
Military Personnel
Active-duty service members who are legal residents of Maryland owe local income tax on their military pay no matter where they’re stationed. If you’re a legal resident of another state serving in Maryland, your military pay is not taxable here, though other Maryland-source income is.7Comptroller of Maryland. Filing Facts for Military Personnel and Their Families Maryland residents with overseas military pay may subtract up to $15,000 in military income earned outside U.S. boundaries, provided total military pay does not exceed $30,000.
Property Tax Rates by County
Property taxes come from up to three sources: the state, the county, and sometimes a municipality. The state rate is small, currently $0.112 per $100 of assessed value. County rates are much larger. For fiscal year 2026, they run from about $0.80 per $100 in Talbot County to $2.248 per $100 in Baltimore City.8Maryland Department of Legislative Services. 2026 County Local Tax Rates A municipality can layer its own rate on top, so a house inside a town’s borders may carry a higher combined bill than an identical property in an unincorporated part of the same county.
Values are set by the State Department of Assessments and Taxation (SDAT), which reappraises every property once every three years using sales data, construction cost analysis, and income methods where appropriate.9Maryland Department of Assessments and Taxation. Real Property Local governments then apply their own tax rate to the assessed value SDAT certifies.
If you think your assessment is too high, you have 45 days from the notice date to file an appeal, first at the supervisor’s level, then to the Property Tax Assessment Appeal Board, and finally the Maryland Tax Court.10Maryland Department of Assessments and Taxation. Assessment Appeal Process Miss the 45-day window and you’ll wait until the next triennial cycle.
Homestead Assessment Caps
For owner-occupied primary residences, the Homestead Tax Credit limits how much assessed value can rise in a single year. State law caps the annual increase at 10%, and counties set their own caps at or below that ceiling. For the July 1, 2026 tax year, caps ranged from 0% in Talbot and Worcester counties to 10% in Calvert, Montgomery, and Somerset, with most jurisdictions choosing something between 2% and 5%.11Maryland Department of Assessments and Taxation. January 1, 2026 Press Release and Report Counties have until March 15 to adjust their cap for the coming tax year. The credit applies automatically, but you have to have filed a one-time application with SDAT to be enrolled.
Homeowners’ Property Tax Credit
A separate credit caps your property tax bill at a set percentage of household income. To qualify, combined gross household income cannot exceed $60,000 and net worth (excluding your home, IRAs, and qualified retirement plans) must be under $200,000.12Maryland Department of Assessments and Taxation. Homeowners’ Property Tax Credit Program The property has to be your principal residence for more than six months of the year.
The formula works on a sliding scale: no tax on the first $8,000 of household income, 4% on the next $4,000, 6.5% on the next $4,000, and 9% on income above $16,000. If your actual bill exceeds the amount the formula produces, the difference becomes your credit.12Maryland Department of Assessments and Taxation. Homeowners’ Property Tax Credit Program The application deadline is October 1, though filing a complete application by April 15 gives you the best chance of seeing the credit on your July 1 bill.13Maryland State Department of Assessments and Taxation. Homeowners’ Property Tax Credit Application HTC-1 Form
Tax Sales
Falling behind on property taxes can trigger a tax sale, where the local government sells the lien to a private investor. You can redeem the property by paying the full lien plus interest at 6% per year from the sale date to the redemption date.14Maryland General Assembly. Maryland Tax – Property Section 14-820 For owner-occupied residential property, taxes and penalties that accrue after the sale cannot be added to the redemption amount. Failing to redeem within the statutory period lets the lien purchaser foreclose and take ownership.
What Counties Cannot Charge, and What They Can
Maryland doesn’t allow county or city sales taxes. The 6% statewide sales and use tax applies uniformly, so crossing a county line never changes what you pay at the register.1Comptroller of Maryland. Maryland Sales and Use Tax 6% Rate Chart
Counties can impose targeted excise taxes. The most common is the admissions and amusement tax on gross receipts from entertainment venues, sporting events, and similar activities. Counties set the rate locally and it can reach up to 10% of gross receipts.15Maryland General Assembly. Maryland Tax – General Code Section 4-102 – Authorization to Impose Admissions and Amusement Tax When the same activity is already subject to state sales tax, the admissions and amusement rate is capped at 5% to avoid double-stacking.16Maryland Comptroller. Business Tax Tip 20 – Calculating Admissions and Amusement Tax Some jurisdictions also collect local hotel and motel occupancy taxes and parking taxes, usually collected by the business and shown as a line item on your receipt.
Recordation and Transfer Taxes on Real Estate
Buying or selling property triggers additional local taxes that catch first-time buyers off guard. The state charges a transfer tax of 0.5% of the sale price on instruments transferring real property interests. First-time Maryland homebuyers pay a reduced rate of 0.25%. Some counties add their own local transfer tax on top of the state rate.
Recordation tax is a separate charge applied when a deed or mortgage is recorded with the county. The rate varies by county and is calculated per $500 of consideration. On higher-priced properties these closing costs add up quickly, and they are typically split between buyer and seller by negotiation, though local custom varies.
Withholding, Filing, and Late Payment
Maryland uses a single return for both state and local tax. Residents file Form 502, which calculates both liabilities at once. Employers withhold based on the county where you live, not where you work.3Maryland Comptroller’s Office. 2025 Maryland State and Local Income Tax Withholding Information Employees who don’t submit a withholding certificate default to the top local rate of 3.20%. The state collects the whole amount and then redistributes each county’s share back.
Update your address with your employer promptly if you move between counties. Going from a lower-rate county to a higher-rate one without adjusting your withholding can leave you short at filing time.
Interest on overdue income tax, including the local portion, runs at 9% per year or 3 percentage points above the average prime rate during the preceding fiscal year, whichever is greater. A penalty of up to 10% of the unpaid tax can apply on top of that for failure to pay when due. Interest keeps accruing during appeals even when collection is paused.
If you receive a notice of assessment from the Comptroller you believe is wrong, you have 30 days from the mailing date to appeal, online through the MyCOMConnect portal or by mail.17Comptroller of Maryland. Frequently Asked Questions about Hearings and the Appeals Process Assessments are presumed correct, so the burden is on you to prove the error. If the hearing officer’s decision still doesn’t match your position, you have 30 days to take the case to the Maryland Tax Court for a fresh review. Missing the initial 30-day window ends your right to a formal hearing.
Pension and Retirement Income Exclusions
Because local income tax is calculated on Maryland taxable income, anything that reduces that figure reduces your local bill too. Taxpayers age 65 or older, or those who are totally disabled, can exclude up to $39,500 of pension or retirement income from taxable income.18Maryland Comptroller’s Office. Technical Bulletin 51 – Senior Citizens and MD Income Tax Separate subtractions cover military retirement income (up to $20,000 for taxpayers 55 or older) and public safety retirement income (up to $15,000 for taxpayers 55 or older). These subtractions come off federal adjusted gross income before the local tax calculation, so the benefit flows through to the county portion automatically.