On May 22, Maryland Gov. Martin O’Malley, the chairman of the Democratic Governors’ Association, signed into law changes to Maryland’s individual income taxes.
–Single filers who make between $100,001 and $125,000 a year in taxable income and joint filers who earn between $150,001 and $175,000 a year would see their state income tax rate rise from 4.75 percent to 5 percent.
–Rates for single filers who make between $125,001 and $150,000 a year in taxable income would see their rate rise from 4.75 percent to 5.25 percent. The 5.25 percent rate would apply to joint filers who make between $175,001 and $225,000 a year.
–Rates would rise from 5 percent to 5.5 percent for singles who make between $150,001 and $250,000 annually in taxable income and joint filers who make $225,001 and $300,000 a year.
–Single and joint filers who make more than $250,000 a year would pay 5.75 percent.
The tax increases would raise an estimated $264 million in fiscal year 2013. It drops down to about $210 million in the fiscal year after that because the tax is retroactive in fiscal year 2013, spanning a year and a half.
Baltimore and the Washington, D.C. suburbs of Montgomery and Prince George’s counties, makes the top state/local combined rate 8.95%. That puts Maryland in a tie with D.C. for the fifth highest rate in the nation. Across the river, in Republican-controlled Virginia, the top state rate is also 5.75%, but there are no local income taxes.
JDKatz, P.C. is a full-service law firm focused on tax law and estate planning. We are dedicated to minimizing your existing liability and risks while providing valuable tax planning to streamline your tax issues in the future. Please call us at 301-913-2948 to schedule an appointment to meet with one of our trusted attorneys.