MD risk area
Tax exposure in Maryland
State estate or inheritance tax rules and how they interact with federal thresholds.
Maryland imposes both an estate tax and an inheritance tax, with a $5 million estate tax exclusion.
Does the state impose an estate or inheritance tax?Who is exempt or receives preferential treatment?How does federal tax interact with state rules?
At a glance
Key takeaways
- The Maryland estate tax exclusion amount remains $5,000,000 per person.
- Inheritance tax is 10% for collateral heirs; siblings are exempt, and close family (spouse, parent, child) are exempt.
- State estate tax thresholds are separate from the federal exemption and can be lower; confirm current exclusion and filing requirements.
- Inheritance tax rates depend on beneficiary class, and close relatives are often exempt or taxed at lower rates.
Questions to consider
Questions this risk area helps you evaluate in Maryland
- Does the state impose an estate or inheritance tax?
- Who is exempt or receives preferential treatment?
- How does federal tax interact with state rules?
State overview
Maryland imposes both an estate tax and an inheritance tax, with a $5 million estate tax exclusion.
- The Maryland estate tax exclusion amount remains $5,000,000 per person.
- Inheritance tax is 10% for collateral heirs; siblings are exempt, and close family (spouse, parent, child) are exempt.
- State estate tax thresholds are separate from the federal exemption and can be lower; confirm current exclusion and filing requirements.
- Inheritance tax rates depend on beneficiary class, and close relatives are often exempt or taxed at lower rates.
Sources
- https://mdbre.gov/BRE_reports/federalimpact/60-day-report-obbb.pdf
- https://registers.maryland.gov/main/taxes.html
- https://taxfoundation.org/data/all/state/estate-inheritance-taxes/
Risk sources
- IRS inflation adjustments for tax year 2026
Use for the current federal estate tax basic exclusion amount.
- IRS Instructions for Form 706 (United States Estate Tax Return)
Defines filing requirements and federal estate tax framework.
- Tax Foundation - State estate and inheritance taxes
Current list of states with estate or inheritance taxes.
National sources provide baseline context; state statutes and court rules control in Maryland.