Estate Planning in Maryland
Maryland has two death taxes: a state estate tax on estates above a $5,000,000 exclusion, and a separate inheritance tax that falls on beneficiaries outside close family. A sound plan starts with who inherits and how each asset is titled, not with a form.
We prepare wills, trusts, powers of attorney and health care directives, and help families through probate, in Baltimore, Anne Arundel County and across the state. Maryland matters are handled through Brandon Northington, who is admitted in Maryland and the District of Columbia.
Maryland's two death taxes, and how an estate is opened
Estate tax. For a decedent dying on or after January 1, 2019, the Maryland exclusion amount is $5,000,000 (Tax-General § 7-309). A surviving spouse can add the first spouse's unused exclusion; if that spouse died on or after January 1, 2019, a Maryland estate tax return must have been timely filed with an irrevocable election.
Inheritance tax. Maryland also imposes a 10 percent inheritance tax on property passing to beneficiaries who are not exempt (Tax-General § 7-204). Exempt classes include spouses, children and their descendants, parents, grandparents and siblings (§ 7-203). Nieces, nephews and friends pay the tax, and the Register of Wills collects it on probate and non-probate transfers alike.
Probate. An estate is opened with the Register of Wills in the county, or Baltimore City, where the decedent lived. A small estate, $50,000 or less (or $100,000 if the surviving spouse is the sole heir), uses a simplified process (Estates and Trusts § 5-601). A regular estate has 3 months to file an inventory and 9 months for a first account, and creditors generally have 6 months from death to present claims (§ 8-103). Even with no probate assets, the original will must be filed with the Register of Wills, at no fee.
Wills
Wills that meet the formalities of Estates and Trusts § 4-102, with provisions that account for inheritance tax on non-exempt beneficiaries.
Revocable Trusts
Trusts that move assets outside probate, titled and funded so they work, with the settlor-creditor rules of § 14.5-508 explained up front.
Estate Tax Planning
Planning for estates approaching the $5,000,000 exclusion, including the portability election and return filing.
Powers of Attorney and Health Care Directives
A written Maryland power of attorney is durable unless it says otherwise (§ 17-105), and an advance directive must be dated, signed and witnessed by 2 people (Health-General § 5-602).
Probate and Administration
Opening estates with the Register of Wills, inventories, accounts and creditor claims.
Who pays Maryland inheritance tax, and how much?
Beneficiaries outside the exempt classes pay a flat 10 percent. A niece, nephew or friend who inherits is taxed; a spouse, child, grandchild, parent or sibling is not. If there is a will, the estate usually pays under a tax clause. Without one, the inheriting heir pays. Life insurance paid to a named beneficiary is exempt.
How do I avoid probate in Maryland?
Probate covers assets titled solely in the decedent's name. A revocable trust, survivorship ownership and beneficiary designations pass outside it, although they still count for inheritance tax. An estate of $50,000 or less qualifies as a small estate, which carries no Register of Wills fee.
How long does probate take in Maryland?
Most estates close within a year of being opened, and the earliest a solvent estate can close is after the 6-month creditor period. Modified administration, available when all heirs and legatees consent and the estate can close within 10 months, skips Orphans' Court approval.
What makes a Maryland will valid?
The maker must be at least 18 and competent. The will must be in writing, signed by the maker (or by another person at the maker's direction and in the maker's presence), and attested and signed by 2 or more credible witnesses who are with the maker. Electronic and remote witnessing are allowed under the conditions in § 4-102.
Facing an estate planning question in Maryland?
The first consultation is confidential, and we respond within one business day. Tell us who you want to protect and what you own.