Income Taxes in Maryland
Maryland's income tax is genuinely the most complex built in this project so far: a real 10-bracket progressive state structure (2%-6.5%) sits under a MANDATORY county-by-county 'piggyback' local income tax (2.25%-3.30% in 2026) that every resident also pays on the same return -- meaning your exact county of residence materially changes your total bill, not just your property tax.
Exploring the idea of moving?
We can connect you with a local real estate professional who knows the area -- no pressure, just a starting point.
Learn moreA real 10-bracket state structure, recently expanded
Maryland levies a genuinely progressive state income tax across 10 brackets, running from 2% up to 6.5% on taxable income over $1,000,000 for single filers. Maryland's 2025 Budget Reconciliation and Financing Act (signed by Gov. Wes Moore, May 20, 2025) added new top brackets and a real 2% capital-gains surtax on high earners, part of a broader push to close a real, dated $3 billion state budget gap -- a genuinely significant, current tax-policy change.
The mandatory county piggyback tax: Maryland's single most distinctive tax fact
Every Maryland county, plus Baltimore City, is legally required to levy its own additional local income tax, collected on the same state return, on top of the state bracket structure. As of this pass's 2026 research, rates run from a real 2.25% low (Somerset and Worcester Counties) to a real 3.30% high (Baltimore City, and Dorchester, Kent, and Montgomery Counties) -- a genuinely higher ceiling than before, since the 2025 reform raised the maximum permitted local rate from 3.2% to 3.3%. Kent County (3.20% to 3.30%) and Allegany County (3.03% to 3.20%) both raised their local rates specifically for 2026. Anne Arundel and Frederick Counties use tiered, income-graduated local rate structures rather than a single flat local rate, adding a further real layer of complexity.
The approximate combined top marginal rate
Combining the 6.5% state top bracket with the 3.30% highest county piggyback rate produces an approximate combined top marginal rate around 9.8% -- disclosed as approximate given the two figures' different bracket thresholds, but a real, useful ballpark for a high earner weighing Montgomery County or Baltimore City against a lower-piggyback-rate county.
This is a mandatory, permanent structure -- not an optional local add-on
Unlike many states where local income tax is a rare, optional add-on, Maryland's piggyback system is a permanent, universal feature: every single county levies one, so there is no piggyback-free Maryland county to move to, only a lower-rate one. Confirm your specific target county's current rate directly with the Comptroller's withholding guide before finalizing a relocation budget.
Key takeaways
- Maryland's state income tax is a real 10-bracket progressive structure (2%-6.5%), recently expanded by a 2025 reform that added new top brackets and a 2% capital-gains surtax.
- Every Maryland county, plus Baltimore City, is legally required to levy an additional 'piggyback' local income tax -- 2.25% to 3.30% in 2026, collected on the same return.
- The approximate combined top marginal rate (state plus highest county piggyback) runs around 9.8% -- a real, useful ballpark for high earners.
- There is no piggyback-free Maryland county -- every county levies one, so confirm your specific target county's current rate directly before budgeting.
Want to know what your budget actually buys here?
Tell us a bit about what you're looking for and we'll connect you with someone local who can walk you through real numbers.
Get local guidanceRead the full Maryland overview for the complete picture, or explore individual cities and towns we've researched.
Planning a move?
Tell us what you're looking for and we'll connect you with a local expert who can help you make it happen.
Talk to a local expert