The Baltimore Register of Wills office, located inside the Elijah E. Cummings Courthouse in downtown Baltimore. (Photo by Christine Condon/Maryland Matters)
When people talk about the “death tax,” they mean the estate tax, a tax on the ultra-wealthy. But Maryland has another death tax — the Maryland inheritance tax, a tax on non-wealthy Marylanders who did not have children.
The Maryland inheritance tax is often conflated with the estate taxes, so people assume that this is a tax on the wealthy. In fact, it’s a tax that only burdens non-wealthy people. More precisely, wealthy people do pay the inheritance tax, but it counts as a credit against the Maryland estate tax, so the inheritance tax does not cost them anything. This bizarre result is due to history, not intentional policy. You can also avoid the tax if you have a second home in another state or a trust…