Maryland (MD) Paycheck Calculator 2026

Form MW507 and the $3,200 exemption

Maryland withholding comes from Form MW507, the Employee’s Maryland Withholding Exemption Certificate. Each exemption you claim is worth $3,200 a year, and employers always use that value; if your federal AGI is over $100,000 you are expected to claim fewer exemptions yourself, because the exemption phases out at higher incomes. Married employees who want withholding to reflect their status need a new MW507 as well as a new federal W-4.

Maryland law does not permit a rate below 4.75% to be used for withholding, even though the lowest brackets on your return start at 2%. For most workers the difference is small, but very low earners can see a little more withheld than they will owe.

County income tax is part of every Maryland paycheck

Every Maryland county and Baltimore City levies a local income tax, and it is withheld from your paycheck together with state tax. The local tax is a percentage of Maryland taxable income, not of state tax, and it is based on where you live, not where you work.

Anne Arundel and Frederick counties use graduated local rates for 2026: Anne Arundel charges 2.70% on the first $50,000 of taxable income for single filers, 2.94% up to $400,000 and 3.20% above; Frederick runs from 2.25% on the first $25,000 to 3.20% above $150,000 for single filers. Allegany raised its rate to 3.20% and Kent to 3.30% for 2026.

Example: $70,000 in Montgomery County

A single worker in Montgomery County earning $70,000 and paid bi-weekly takes home about $2,034 per check in 2026. State income tax is about $114 and the 3.2% county tax about $86 per check, so Maryland’s two taxes together take roughly $200 from each paycheck, more than Social Security.

There is no Maryland paid-leave deduction yet: FAMLI contributions have been postponed until January 1, 2027.

Reciprocity with DC, Pennsylvania, Virginia and West Virginia

Residents of the District of Columbia, Pennsylvania, Virginia and West Virginia generally file only with their home jurisdiction, and Maryland residents who commute daily to those places file only with Maryland. A DC or Virginia resident working in Maryland is exempt from Maryland withholding on wages as long as they do not live in Maryland for more than six months of the year; past that point they are a statutory resident and file a Maryland resident return. Pennsylvania residents may also be exempt under the same six-month test, while West Virginia residents are exempt however long they live in Maryland.

To stop Maryland withholding, an exempt employee files a corrected MW507 with the employer. If tax was withheld anyway, the refund is claimed on nonresident Form 505. Residents of Wilmington, Delaware, and of certain Pennsylvania localities that tax Maryland commuters must file Maryland Form 515 instead.

Nonresidents from other states who work in Maryland generally do not have a local tax rate, but employers withhold an extra state tax at the lowest local rate, 2.25%, in its place. Maryland residents who work in Delaware file in both states and claim a credit for the Delaware tax on Form 502CR.