Maryland Estate & Inheritance Tax Nonresident Guide
Last updated: 11 Nov 2025 • Author: Alexander Foelsche CPA (US), WP (DE), RE (CH)
Maryland Estate Tax — Nonresident Guide
For estates of decedents domiciled outside Maryland that own Maryland-situs property. This guide explains who must file, what is taxable, how deductions are typically allocated, deadlines & extensions, payment, interaction with Maryland’s separate inheritance tax, and practical checklists. Md. Code, Tax–General
Do you need to file as a nonresident?
What counts as Maryland-situs property?
| Asset type | Taxed by Maryland? | Notes |
|---|---|---|
| Real property located in Maryland | Yes | Residences, land, commercial property. Appraisals should reflect local market evidence. |
| Tangible personal property kept in Maryland | Yes | Boats, vehicles, equipment, artwork physically in Maryland. |
| Intangibles (stock, bonds, bank/brokerage) | Generally no | Usually sourced to the decedent’s domicile unless a business situs exists in Maryland. |
| Entity interests (LLC/partnership) | Generally no | Treated as intangibles; avoid Maryland-centered operations/management that could suggest business situs. |
How Maryland limits the tax to the Maryland portion
- Maryland-taxable estate begins from a federal-style scaffolding (Form 706 schedules) but for a nonresident includes only Maryland-situs assets.
- Deductions are generally allowed to the extent connected with Maryland-situs assets; mixed/general administration expenses are often prorated using a reasonable allocation method documented in the file.
- Exclusion: Apply the $5,000,000 Maryland exclusion to the resulting Maryland base; compute Maryland tax on the remainder under state rules.
Maintain a clear worksheet showing federal values, Maryland-situs filtering, deduction allocation, and the final Maryland computation.
Deadlines, extensions & payment
| Item | Timing | Notes |
|---|---|---|
| Maryland estate tax return | 9 months after date of death | Payment is due by 9 months even if you extend to file. |
| Extension to file | Request by month 9 | Typically up to 6 months to file; does not extend time to pay. |
| Paying the tax | By 9 months | Use Comptroller payment options; consider a tentative payment if appraisals are pending. |
| Inheritance tax (separate) | Per county procedure | Administered by the Register of Wills/Orphans’ Court; coordinate with the estate tax return and retain receipts. |
Core forms (nonresident focus)
Comptroller forms
- Maryland Estate Tax Return (state packet with schedules & instructions).
- Application for Extension of Time to File (estate tax).
- Payment voucher / approved e-pay options.
Federal attachments
- Form 706 (or 706-NA) pages/schedules and any Form 712 (life insurance).
- Deeds/titles, appraisals, proof of Maryland asset location; will/trust; letters of authority.
If no federal 706 is required, include pro-forma schedules to support the Maryland return.
Quick examples
Example — Bethesda condo to children
Nonresident decedent owns a Maryland condo and out-of-state investments. The Maryland return includes the condo (and deductions allocable to it) only; non-Maryland accounts are excluded from the Maryland base.
Example — Boat stored in Annapolis
A boat kept in Maryland passes to a niece. The boat is Maryland-situs tangible property and is included in the Maryland computation even if the rest of the estate is outside Maryland.
Nonresident filing checklist
Documents
- Death certificate; letters of appointment (domicile state and any Maryland ancillary).
- List of Maryland-situs assets with appraisals and location evidence.
- Federal schedules (706/706-NA), will/trusts, beneficiary designations.
Computations & timing
- Compute the Maryland portion; exclude non-Maryland assets.
- Document allocation/proration of general administration expenses.
- Target the 9-month payment; request an extension to file if needed (not to pay).
- Coordinate any inheritance-tax filings with the appropriate Register of Wills.
FAQs — Nonresident estates
Are nonresident brokerage accounts taxed by Maryland?
Generally no. Nonresident intangibles (e.g., brokerage, stock, cash) are typically not Maryland-situs unless they have a business situs in Maryland.
Do I have to file if there’s no Maryland property?
Usually not. If the decedent had no Maryland-situs assets, a Maryland estate tax filing is generally not required. Verify titles and storage/location facts carefully.
How do I evidence compliance for a sale or transfer?
Provide a copy of the filed Maryland estate tax return, Comptroller payment receipts, and (if applicable) inheritance-tax receipts from the Register of Wills. Title/escrow and financial institutions may require these before closing or retitling.
What if no federal estate return is required?
You may still need a Maryland filing. Prepare federal-style schedules as pro-forma support and request a filing extension if appraisals are pending. Payment is still due by 9 months.
References
- Maryland Code — Tax–General (estate tax provisions: scope, exclusion, deductions, elections).
- Comptroller of Maryland — Estate Tax return packet, extension, and payment instructions.
- Registers of Wills / Orphans’ Courts — Maryland inheritance-tax procedures and exemptions.
- IRS Form 706 / 706-NA & Instructions — federal schedules used as valuation/deduction scaffolding.