Paid by the estate before assets are distributed to heirs.
Inheritance Tax
Exemption
$1,000
Top Rate
10.0%
Paid by the heirs on what they personally receive.
How it works in Maryland
Imposes both an estate tax ($5 million exemption, rates up to 16%) and a flat 10% inheritance tax. Surviving spouses, children, and grandchildren are exempt from the inheritance tax.
Who pays Maryland's death tax?
The Maryland estate tax is owed by the estate itself, typically paid by the executor or personal representative before assets are distributed. The tax applies only to the portion of the gross estate exceeding $5,000,000, and the top marginal rate is 16.0%. The Maryland inheritance tax is owed by each heir based on what they personally receive. Rates frequently depend on the beneficiary's relationship to the deceased — close relatives are often exempt or taxed at lower rates than unrelated heirs.
How Maryland compares
Only 12 states plus D.C. impose an estate tax, and just 6 impose an inheritance tax. Maryland is the only state with both. Exemptions range from $1 million (Oregon, Rhode Island) up to the federal level (Connecticut), and top rates cluster around 16%. Compare Maryland against the rest in our full state-by-state directory.
Planning around Maryland's rules
Lifetime gifting: Annual exclusion gifts ($19,000 per recipient in 2026) reduce the taxable estate without using the federal exemption.
Irrevocable trusts: ILITs and SLATs can move assets and future appreciation outside the Maryland taxable estate.
Spousal planning: Transfers to a surviving spouse are generally fully deductible at the state level.
Domicile change: Establishing residency in a no-estate-tax state ahead of death can eliminate exposure entirely — but Maryland will scrutinize a late-in-life move closely.
Frequently asked questions
Does Maryland have an estate tax in 2026?+
Yes. Maryland imposes an estate tax on estates exceeding $5,000,000, with a top marginal rate of 16.0%. The tax is paid by the estate before assets are distributed to heirs.
Does Maryland have an inheritance tax?+
Yes. Maryland imposes an inheritance tax with a top rate of 10.0%. Inheritance taxes are paid by the heirs receiving assets, and rates often vary by relationship to the deceased.
What is the Maryland estate tax exemption for 2026?+
The Maryland estate tax exemption for 2026 is $5,000,000. Estates valued at or below this threshold owe no state estate tax.
Who pays the tax in Maryland — the estate or the heirs?+
Both. The estate pays the estate tax before distribution, and heirs pay the inheritance tax on what they receive. Maryland is one of the few states with both.
How can Maryland residents reduce their estate or inheritance tax exposure?+
Common strategies include lifetime gifting under the federal annual exclusion, irrevocable trusts (ILITs, SLATs), spousal portability planning, charitable bequests, and — for those near the exemption — relocating domicile to a state without estate or inheritance taxes. Consult an estate attorney licensed in Maryland.
Disclaimer: This page is informational only and not legal or tax advice. Estate and inheritance tax rules change frequently — verify thresholds with a Maryland-licensed estate attorney or tax advisor before acting.