Maryland County
MD-CO · local · 12 cited facts
| Category | Provision | Value | Source |
|---|---|---|---|
| rate | Maryland local/county tax rate (TY2025) | Up to 3.30% of Maryland taxable income (statutory range 2.25% to 3.30%; top TY2025 rate: Dorchester 3.30%); counties may apply brackets for rates effective on or after January 1, 2022 (Anne Arundel, Frederick, and Dorchester are progressive) | sources (2)Md. Code, Tax-General §10-106(a)(1), (c)(1) · high confidence · as of 2026-07-02 · TY 2025 Maryland county income tax: each county sets a rate between 2.25% and 3.30% of Maryland taxable income; counties may apply the tax on a bracket basis for rates effective on or after January 1, 2022 (a)(1) Each county shall set, by ordinance or resolution, a county income tax equal to at least 2.25% but not more than 3.30% of an individual's Maryland taxable income for a taxable year beginning after December 31, 2001. ... (c)(1) For any county income tax rate that is effective on or after January 1, 2022, the county may apply the county income tax on a bracket basis.https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-106&enactments=false Comptroller of Maryland, Tax Alert: Changes to Standard and Itemized Deductions and to State and Local Income Tax Rates (2025 legislative session) · high confidence · as of 2026-07-02 · TY 2025 Dorchester County adopted the new 3.30% maximum county rate retroactively for TY2025 (the top county rate) Dorchester County was the only county to do so, retroactively increasing its rate from 3.20 percent to 3.30 percent for tax year 2025.https://www.marylandcomptroller.gov/content/dam/mdcomp/tax/legal-publications/alerts/tax-alert-changes-to-standard-and-itemized-deductions-and-to-state-and-local-income-tax-rates-from-the-2025-legislative-session.pdf |
| character | Long-term capital gains treatment | Ordinary rate: no preferential long-term rate; the MD county tax base follows MD taxable income, where capital gains are taxed as ordinary income (Md. Tax-Gen. §10-105); the county rate applies equally to long- and short-term gains | sources (1)Md. Code Ann., Tax-Gen. §10-105(a)(2) (as amended by BRFA 2025, Ch.604) · high confidence · as of 2026-07-20 · TY 2025 Maryland top income tax rate is 6.5% on income above $1,200,000 MFJ (TY2025; BRFA 2025) 6.25% of Maryland taxable income of $600,001 through $1,200,000; and (x) 6.50% of Maryland taxable income in excess of $1,200,000. Note: Verbatim from the top brackets of §10-105(a)(2) (joint filers), verified against the live statute page. BRFA 2025 (Ch.604, retroactive to TY2025) added the 6.25% and 6.5% brackets. The rate schedule lives in §10-105, not §10-104 (which lists exempt entities); a prior version of this fact quoted a reconstructed full schedule attributed to §10-104 and has been corrected. Single filers top at 6.5% over $1,000,000. Standard deduction $6,700 (TY2025). https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-105 |
| conformity | Loss carryforward | Conforms to IRC §1212: the MD county tax base follows MD taxable income, which applies the federal indefinite capital-loss carryforward | sources (1)IRC §1212(b) · high confidence · as of 2026-06-21 · TY 2025 IRC §1212(b): capital losses carry forward only for non-corporate taxpayers; no carryback In the case of a taxpayer other than a corporation, if there is a net capital loss for any taxable year: (1) the excess of the net short-term capital loss over the net long-term capital gain for such year shall be a short-term capital loss in the succeeding taxable year, and (2) the excess of the net long-term capital loss over the net short-term capital gain for such year shall be a long-term capital loss in the succeeding taxable year. Note: IRC §1212(b) limits non-corporate taxpayers to carrying losses forward only ('succeeding taxable year'). IRC §1212(a), which allows a 3-year carryback, applies only to corporations. For conformity states, the federal carryforward amount flows to the state return unchanged. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1212&num=0&edition=prelim |
| qoz-conformity | QOZ conformity (IRC §1400Z-2) | Conforms: MD county local tax base follows MD state taxable income, which conforms to IRC §1400Z-2 | sources (1)Md. Code Ann., Tax-Gen. §10-101(e)(1) (federal AGI starting point) · high confidence · as of 2026-07-21 · TY 2025 Maryland conforms to IRC §1400Z-2 QOZ gain deferral and exclusion "Federal adjusted gross income" means: (1) for an individual other than a fiduciary, the individual's adjusted gross income as determined under the Internal Revenue Code. Note: Md. Code Ann., Tax-Gen. §1-101 defines Maryland taxable income and federal taxable income by rolling reference to the Internal Revenue Code as amended. This rolling conformity incorporates IRC §1400Z-2 (QOZ gain deferral and 10-year exclusion) without modification. https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-101 |
| qsbs-conformity | QSBS conformity (IRC §1202) | Conforms: MD county local tax base follows MD state taxable income, which conforms to IRC §1202 | sources (1)Md. Code Ann., Tax-Gen. §10-101(e)(1) (federal AGI starting point) · high confidence · as of 2026-07-21 · TY 2025 Maryland conforms to IRC §1202 QSBS gain exclusion; no addback "Federal adjusted gross income" means: (1) for an individual other than a fiduciary, the individual's adjusted gross income as determined under the Internal Revenue Code. Note: Md. Code Ann., Tax-Gen. §10-304 defines Maryland taxable income by rolling reference to federal adjusted gross income and the Internal Revenue Code as amended. This conformity incorporates IRC §1202 (QSBS gain exclusion) without modification; no state-level addback. https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-101 |
| agency-obligations | GSE bond interest (FNMA/FHLMC) | Taxable: MD county local tax base follows MD state taxable income, where GSE interest is taxable | sources (1)Md. Code Ann., Tax-Gen. §10-208(a)(2) · medium confidence · as of 2026-06-20 · TY 2025 Maryland subtraction for U.S. government interest requires income be exempt from state taxes under federal law; FNMA and FHLMC have no such federal bondholder exemption An individual may subtract from Maryland adjusted gross income amounts that are required to be subtracted by the laws of the United States. Note: The §10-208(a)(2) subtraction requires exemption under federal law. FNMA (12 U.S.C. §§1719(e), 1723a(c)) and FHLMC (12 U.S.C. §1455(a)) have no bondholder exemption statute; only the corporation itself is exempt from Maryland taxation, not bondholders. No MD Comptroller named-entity publication found; confidence: medium based on structural statutory analysis. https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-208 |
| dividend-qualified | Qualified dividend income | Ordinary rate: MD county has no preferential rate for qualified dividends; taxed at ordinary county rate | sources (1)Md. Code Ann., Tax-Gen. §10-105(a)(2) (as amended by BRFA 2025, Ch.604) · high confidence · as of 2026-07-20 · TY 2025 Maryland top income tax rate is 6.5% on income above $1,200,000 MFJ (TY2025; BRFA 2025) 6.25% of Maryland taxable income of $600,001 through $1,200,000; and (x) 6.50% of Maryland taxable income in excess of $1,200,000. Note: Verbatim from the top brackets of §10-105(a)(2) (joint filers), verified against the live statute page. BRFA 2025 (Ch.604, retroactive to TY2025) added the 6.25% and 6.5% brackets. The rate schedule lives in §10-105, not §10-104 (which lists exempt entities); a prior version of this fact quoted a reconstructed full schedule attributed to §10-104 and has been corrected. Single filers top at 6.5% over $1,000,000. Standard deduction $6,700 (TY2025). https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-105 |
| muni-instate | In-state muni bond interest | Exempt: MD county local tax base follows MD taxable income, where Md. Tax-Gen. §10-204(b) adds back only other-state obligations; MD bonds not added back | sources (1)Md. Tax-Gen. §10-204(b) · high confidence · as of 2026-06-18 · TY 2025 MD exempts MD-issued bonds; out-of-state muni bond interest added to MD income per §10-204(b) The addition under subsection (a) of this section includes interest or dividends, less related expenses, attributable to an obligation or security of: (1) another state; or (2) a political subdivision or authority of another state. Note: §10-204(b) requires addition of out-of-state muni interest; MD-issued bonds exempt by negative implication (not covered by the addition provision). https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-204&enactments=False |
| muni-outstate | Out-of-state muni bond interest | Taxable: MD county local tax base follows MD taxable income, where Md. Tax-Gen. §10-204(b) adds back out-of-state muni interest | sources (1)Md. Tax-Gen. §10-204(b) · high confidence · as of 2026-06-18 · TY 2025 MD exempts MD-issued bonds; out-of-state muni bond interest added to MD income per §10-204(b) The addition under subsection (a) of this section includes interest or dividends, less related expenses, attributable to an obligation or security of: (1) another state; or (2) a political subdivision or authority of another state. Note: §10-204(b) requires addition of out-of-state muni interest; MD-issued bonds exempt by negative implication (not covered by the addition provision). https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-204&enactments=False |
| treasury | U.S. Treasury interest | Exempt: 31 U.S.C. §3124(a) prohibits state/local taxation of U.S. government obligations | sources (1)31 U.S.C. §3124(a) · high confidence · as of 2026-06-20 · TY 2025 U.S. Treasury interest exempt from Maryland income tax: 31 U.S.C. §3124(a) prohibits state taxation of U.S. government obligations Stocks and obligations of the United States Government are exempt from taxation by a State or political subdivision of a State. The exemption applies to each form of taxation that would require the obligation, the interest on the obligation, or both, to be considered in computing a tax. Note: 31 U.S.C. §3124(a) preempts state income taxation of U.S. government obligations. Covers T-bills, T-notes, T-bonds, TIPS, and I-bonds. Most states allow a deduction or subtraction by statute cross-referencing this federal preemption. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title31-section3124 |
| fhlb-ffcb | FHLB and FFCB bond interest | Exempt: federal enabling statutes mandate state/local tax exemption for FHLB and FFCB securities | sources (2)12 U.S.C. §1433 (Federal Home Loan Bank Act) · high confidence · as of 2026-06-20 · TY 2025 FHLB and FFCB bond interest exempt from Maryland income tax: federal enabling statutes mandate state tax exemption Any security issued under this chapter by a Federal home loan bank, including the stock thereof, shall be exempt from taxation, except taxes upon real estate, by any State, county, municipality, or local taxing authority. Note: 12 U.S.C. §1433 (FHLB) and 12 U.S.C. §2023 (FFCB/Farm Credit Act) both mandate state tax exemption for securities issued under their chapters. Contrasts with FNMA (12 U.S.C. §§1719(e), 1723a(c)) and FHLMC (12 U.S.C. §1455(a)) which have no bondholder exemption statute and whose interest is taxable by income-tax states. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section1433&num=0&edition=prelim12 U.S.C. §2023 (Farm Credit Act) · high confidence · as of 2026-06-20 · TY 2025 Farm Credit Act: notes, bonds, debentures, and other obligations of Farm Credit Banks are instrumentalities of the United States exempt from all State, municipal, and local taxation The mortgages held by the Farm Credit Banks and the notes, bonds, debentures, and other obligations issued by the banks shall be considered and held to be instrumentalities of the United States and, as such, they and the income therefrom shall be exempt from all Federal, State, municipal, and local taxation, other than Federal income tax liability of the holder thereof under the Public Debt Act of 1941 (31 U.S.C. 3124). Note: 12 U.S.C. §2023 explicitly covers 'the income therefrom' (i.e., interest payments to bondholders), exempting it from all State and local taxation. The only carve-out is federal income tax on the holder. Parallel to 12 U.S.C. §1433 (FHLB Act), which exempts FHLB securities from state taxation. Together §1433 and §2023 mandate state and local tax exemption for both FHLB and FFCB bond interest. Shared across all jurisdictions: a single object reference satisfies buildCitationIndex() identity check. https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title12-section2023&num=0&edition=prelim |
| filing-status-identical | Filing status: one county schedule in the enabling statute | Yes: Tax-General §10-106(a)(1) sets each county's income tax on an individual's Maryland taxable income with no separate MFJ schedule in the enabling statute; counties may apply the tax on a bracket basis for rates effective on or after January 1, 2022 (§10-106(c)(1)), and bracket ordinances are county-specific | sources (1)Md. Code, Tax-General §10-106(a)(1), (c)(1) · high confidence · as of 2026-07-02 · TY 2025 Maryland county income tax: each county sets a rate between 2.25% and 3.30% of Maryland taxable income; counties may apply the tax on a bracket basis for rates effective on or after January 1, 2022 (a)(1) Each county shall set, by ordinance or resolution, a county income tax equal to at least 2.25% but not more than 3.30% of an individual's Maryland taxable income for a taxable year beginning after December 31, 2001. ... (c)(1) For any county income tax rate that is effective on or after January 1, 2022, the county may apply the county income tax on a bracket basis.https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gtg§ion=10-106&enactments=false |