Maryland LLC Taxes Explained: The State + County Stack (2026)
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax.
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax. Federal self-employment tax depends on classification, earnings, owner status, wages and annual Social Security limits. Not every distribution is subject to a flat 15.3%. An S election requires eligibility, reasonable compensation and a comparison of payroll and compliance costs; no universal profit threshold establishes savings.
- State income tax
- 2%–6.50% graduated
- County income tax
- 2.25%–3.30% — everywhere
- Top state + local marginal
- Up to 9.80%
- Entity-level tax
- Mandatory nonresident/PTE election rules apply
- Sales tax
- 6% — no local rates
- S-Corp analysis
- Case-specific
The 5 Layers of Maryland LLC Taxation
Federal: income + self-employment tax
Pass-through profits hit your 1040 at your federal bracket, plus 15.3% SE tax on 92.35% of net profit — usually the biggest line.
Maryland state income tax: 2%–6.50%
Apply the current Maryland individual tax brackets, deductions, exemptions, sourcing and county rules for the actual filer. This page does not calculate an exact state-plus-county return.
County income tax: 2.25%–3.30%
Maryland's signature layer — every county and Baltimore City taxes resident income at locally set rates, collected with your state return. This is a full second income tax, not a surcharge.
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax.
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax.
Sales tax: 6% (if applicable)
Flat statewide, zero local add-ons; 3% on certain data/IT services, 9% on alcohol. See Step 7.
Review State, County and PTE Requirements
Maryland tax planning references
Choose the relevant taxpayer. Individual county rates are separate from the PTE rates.
Use Maryland’s applicable individual brackets, county schedule, deductions, sourcing and federal classification. Federal self-employment tax depends on classification, earnings, owner status, wages and annual Social Security limits. Not every distribution is subject to a flat 15.3%. An S election requires eligibility, reasonable compensation and a comparison of payroll and compliance costs; no universal profit threshold establishes savings.
The County Tax, Concretely
| Jurisdiction (examples) | County Rate | With 4.75% State (typical bracket) |
|---|---|---|
| Baltimore City · Montgomery | 3.20% | ~7.95% combined |
| Prince George's · Howard | ~3.2% | ~7.95% combined |
| Anne Arundel | ~2.8% | ~7.55% combined |
| Worcester (lowest) | 2.25% | ~7.00% combined |
The county tax follows your residence, not your LLC's address — a Frederick resident running a Baltimore City LLC pays Frederick's rate. It's collected through your regular Maryland return (Form 502), so there's no separate filing — just a real rate difference of nearly a full percentage point across the state, worth knowing before you move.
The S-Corp Question
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax.
Your Maryland Tax Calendar
| Date | What's Due |
|---|---|
| Jan 15 / Apr 15 / Jun 15 / Sep 15 | Quarterly estimated taxes — federal and Maryland (state + county), on pass-through profit |
| Mar 15 | Form 1065 (multi-member LLCs) + K-1s |
| Apr 15 | Form 1040 + Maryland Form 502 — and SDAT Form 1 ($300 or waived), all the same day |
| Monthly/Quarterly | Sales & use tax returns to the Comptroller per your assigned schedule |
| Apr 30 | Trader's license renewal (retail — license year ends) |
Ahmad Adil's Take: Maryland founders consistently under-withhold for one reason — they budget the state rate and forget the county is a full second income tax, not a rounding error. In Baltimore City or Montgomery County your marginal state-plus-local rate runs about 7.95% before federal — high enough that the local layer materially changes the total tax burden. My Maryland rule: set aside 33–37% of profit in the high-rate counties (30–34% in the cheaper ones), consider the S-Corp and PTE-election conversations together once profits are consistently strong enough to justify payroll and compliance costs, and remember everything lands April 15 — taxes, Form 1, the whole year — so February bookkeeping isn't optional here, it's survival.
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2026 PTE rates and April election update
For 2026 Maryland PTE estimates, the individual-member rate is 8.75% (6.5% state plus 2.25% special nonresident component); the entity-member rate is 8.25%. The April 13, 2026 alert postpones resident-member worldwide-income expansion to 2027: 2026 electing-PTE income remains Maryland-attributable for resident and nonresident members. For 2026, the election/nonelection is determined by the next filing or payment after April 15, rather than the first-quarter election. Review adjustments for first-quarter overpayments. Estimates generally apply when expected PTE tax exceeds $1,000; current instructions use 90% of current-year or 110% of prior-year tax. Default pass-through treatment does not eliminate mandatory nonresident PTE duties or elected entity-level tax.
Maryland LLC — FAQ
Ahmad Adil is the founder and CEO of LLC School. For filing and ongoing compliance, confirm the requirements with the responsible state agency. This is educational information, not legal or tax advice.
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