Filing a state income tax return can be nerve-wracking. But if you know Maryland's procedures, it will help your tax year go smoother. The most important item to remember is the filing date. When planning your tax preparation, filing on time is the best way to avoid expensive penalties.
Who Must File Maryland Income Taxes?
If you are a single Maryland resident and have a taxable income of or above $12,950 you must file a Maryland tax return.
A married couple or taxpayers filing jointly with a taxable income of $25,900 or more must file a Maryland state tax return.
Defined as a taxpayer’s federal income, it excludes Social Security benefits or railroad retirement that are combined with any in-state income additions.
Filing a return with the IRS indicates you should file with the state.
If you work in Delaware but live in Maryland, file tax returns with both states. But so you aren’t taxed twice, file a form asking for credit from Maryland.
Living in Maryland but working in Washington D.C., West Virginia, Virginia or Pennsylvania requires you to file in Maryland. That’s because Maryland has tax reciprocity agreements with these states.
What Are the Forms to Use?
Maryland provides tax forms, booklets and instructions. You can download them, visit the Comptroller of Maryland office or email a request for forms to email@example.com.
You need to file Form 502 if you are a resident and are not claiming any dependents. If you are claiming dependents, then use Form 502B.
Form 502CR should be submitted with your Maryland state tax return if you live in Maryland but work in Delaware.
What is the Tax Rate in Maryland?
Maryland has graduated tax rates. Single taxpayers have a flat plus interest rate based on gross income.
- $0 to $1,000 – 2 percent
- $1,000 to $2,000 – $20 plus 3 percent excess over $1,000
- $2,000 to $3,000 – $50 plus 4 percent excess over $2,000
- $3,000 to $100,000 – $90 plus 4.75 percent excess over $3,000
- $100,00 to $125,000 – $4,697.50 plus 5 percent excess over $100,000
- $125,000 to $150,000 – $5,947.50 plus 5.25 percent excess over $125,000
- $150,000 to $250,000 – $7,260 plus 5.50 percent excess over $150,000
- Over $250,000 – $12,760 plus 5.75 percent of the excess of $250,000
This means, for example, if you made $1,500, you would pay a flat rate of $20 and an additional three percent of tax on the $500 over the $1,000. The addition would be $15. That would bring your tax bill to $35.
Married individuals or those filing jointly also have a flat plus interest rate.
- $0 to $1,000 – 2 percent
- $1,000 to $2,000 – $20 plus 3 percent of excess over $1,000
- $2,000 to $3,000 – $50 plus 4 percent of excess over $2,000
- $3,000 to $150,000 – $90 plus 4.75 percent of the excess over $3,000
- $150,000 to $175,000 – $7,072.50 plus 5 percent of the excess over $150,000
- $175,000 to $225,000 – $8,322.50 plus 5.25 percent of the excess over $175,000
- $225,000 to $300,000 – $10,947.50 plus 5.50 percent
- Over $300,000 – $15,072.50 plus 5.75 percent of the excess over $300,000
Make sure you have your W-2 form or 1099 so that you’ll know which tax bracket applies to you.
What are the Filing Deadlines and Extension Process?
The filing deadline for Maryland individual income tax returns was originally supposed to fall on April 18, 2023.
If you are unable to file by the due date, you may request an extension. Although the extended filing date may be extended up to six months.
To request an automatic extension on filing a return, use Form P.V. instructions. It extends the time you have to file, but it doesn’t extend the time to pay owed taxes.
You can file an extension by phone if no taxes are due. The number is 410-260-7829.
A taxpayer who has been granted a six-month extension by the IRS automatically receives the same from Maryland.
Any military or support personal serving in a designated combat zone and their spouse is allowed an extension of up to six months.
What are the Penalties for Late Filing and Underpayment of Taxes?
The Comptroller of Maryland states penalty charges for failure to file a return can be up to 25 percent of the tax you owe. The penalty for underpayment is 25 percent of the underpayment tax due.
Interest on taxes owed is 9 percent accrued each year. Maryland provides a calculator for unpaid tax interest calculations.
If you can’t pay your taxes, it is best to file by the due date. That will save you in penalties.
Where Do I Mail/E-file My Maryland Return?
Individual taxpayers can mail their returns. The address for Form 502 or Form 505 filed with payments by check or money order is Comptroller of Maryland Payment Processing, P.O. Box 8888, Annapolis, MD, 21401-8888.
All other returns or correspondence should be mailed to the Comptroller of Maryland Revenue Administration Division, P.O. Box 549, Annapolis, MD, 21411-0001.
Whether you have a professional do your tax preparation or file yourself, there are three ways to file online. They include using a tax preparer, filing with approved commercial software or filing for free with Maryland's iFile service.
You are not eligible to e-file if you are using Form 500 CR.
You can file a tax return free and in person. Make an appointment at a local branch.
How Do I Pay Taxes Due?
You can pay your due taxes by mailing a check or money order.
A credit card can also be used. Credit cards accepted include Visa, MasterCard, American Express or Discover. Payments can be made online or over the phone at 1-800-2PAYTAX (1-800-272-9829).
When you e-file, you can use a debit payment. If you file electronically, you’ll have additional time past the due date to make your payment.
If you cannot pay the taxes due, you may request a payment plan. Pay as much as you can when you file your tax return and continue making payments while your return is being processed.
Once your return is processed, you will be sent a Personal Income Tax Balance Due Notice. At that time, if you can't pay it in full, you can indicate a preferred payment term and return it to the Comptroller of Maryland by mail. Or you can send an email at firstname.lastname@example.org.
You may also call the Collection Section at 410-974-2432 or 1-888-674-0016. An extension application is also online.
Where Can I Check My Maryland Refund Status?
To obtain the status of your refund, you may either call or go online. The number is 410-260-7701 or 1-800-218-8160. This is an automated Refund Request Line. The status is updated at approximately 10:30 a.m. daily.
By filing electronically and choosing direct deposit into your bank account, you will have a refund within days of the return’s processing.
What About Maryland State Taxes if You’re Self-employed?
Self-employed individuals are responsible for filing income on their personal tax returns.
What About Maryland State Taxes if You’re a Business?
The corporation Maryland state tax rate is 8.25 percent.
A pass-through entity like an LLC, S-corporation or partnership’s income is passed on to the members and owners. A pass-through entity form must still file.
Rates and dates in this article are correct as of publication. But check for any changes at the Comptroller of Maryland before you file.
- Comptroller of Maryland: Business Income Tax Information
- Comptroller of Maryland: Contact Us
- Comptroller of Maryland: Frequently Asked Questions about eFiling Maryland Taxes
- Comptroller of Maryland: Online Tax Payments
- Comptroller of Maryland: Individual Payment Agreement
- Comptroller of Maryland: Extensions
- eFile: Maryland Income Taxes and MD State Tax Forms
- Comptroller of Maryland: Using Downloadable Forms
- Comptroller of Maryland: What’s New for the 2021
- Comptroller of Maryland: Online Services for Individuals
- Comptroller of Maryland: Filing Information for Individual Income Tax
- WTOP News: Maryland Extends Tax Deadline by 3 Months
Anne attended University of Akron and went on to have a career in television sales. Working as a commercial property and casualty insurance agent for nine years allowed her to learn about different businesses' needs. She has also owned an advertising agency where she created marketing capaigns for various clients. Anne has written for several publications. She currently resides in Charleston, SC.