Maryland exit tax 2026: the 8.75% nonresident withholding

The Maryland exit tax.

Not a tax on leaving. Maryland withholds 8.75% of the net proceeds when a nonresident individual sells Maryland real estate, raised from 8% for sales after June 30, 2025.

In short, current to October 2026

A seller who is not a Maryland resident on the date of transfer has 8.75% of the net proceeds, 8.25% for an entity withheld at settlement, reported on Form MW506NRS. The deed is not recorded without it.
The rate rose from 8% to 8.75% for sales after June 30, 2025, because the Budget Reconciliation and Financing Act of 2025 raised the top state rate (Comptroller of Maryland Tax Alert, April 13, 2026).
It is withheld on proceeds, not on gain, so it can far exceed the tax owed. A certificate of full or partial exemption, applied for on Form MW506AE at least 21 days before settlement, reduces it.
The same act added a 2% tax on net capital gains for individuals whose federal adjusted gross income exceeds $350,000.
Current to October 2026. Not tax advice. Confirm a sale or a move with counsel before relying on any figure.

Each address on this page was last checked against its official sources between 22 October 2026 and 28 October 2026. The sources for each are named on its page.

Source: the Patrician.ch board, an original ranking of 100 residence addresses across 47 countries and territories. Tax rates, thresholds and routes are sourced. Cost, safety, schools, sun and beauty are Patrician.ch editorial indices. Figures current to October 2026. Updated 7 November 2026. Cite as: Patrician.ch, Maryland exit tax 2026: the 8.75% nonresident withholding, patrician.ch/answers/maryland-exit-tax/, October 2026.

Compared

What each state holds at closing.

State	On the move itself	Held at closing when a nonresident sells	Form
California	Nothing. Voters rejected Proposition 40 on November 3, 2026	3 1/3% of the sale price, or 12.3% of the gain by election	FTB Form 593
New Jersey	Nothing	10.75% of the gain or 2% of the price, whichever is greater, plus the seller-paid graduated fee of 1% to 3.5% on sales above $1,000,000	GIT/REP-1
New York	Nothing	10.9% of the gain	IT-2663 (IT-2664 for a co-op)
Maryland	Nothing	8.75% of the net proceeds, 8.25% for an entity	MW506NRS
Massachusetts	Nothing	4% of the gross price, plus 4% on the part above $1,107,750, on sales of $1,000,000 or more	Form NRW

Sources: Franchise Tax Board, 2026 instructions for Form 593. N.J.S.A. 54A:8-8 to 8-10, P.L. 2025, c.69. NY Tax Law section 663, 2026 Form IT-2663. Comptroller of Maryland Tax Alert, April 13, 2026. 830 CMR 62B.2.4, from November 1, 2025. Each is a prepayment of income tax, reconciled on the nonresident return for the year of sale, not a separate tax. Exemptions exist in every state, the sale of a principal residence being the common one.

See these 2 places for your own income.Miami and Coral Gables, side by side on your income, passports and family. Free, in the ranking of all 100. Then the Dossier: a written report in 10 chapters on the 3 places that rank first for you. The Dossier is $500. The founding price, $250, holds until 30 November.

Compare them on my income →

Where a Maryland high earner moves.

The American addresses on the board with no state income tax, on $1,000,000 of income.

Miami 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Coral Gables 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Naples 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Bal Harbour 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Palm Beach 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Austin 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Dallas 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Las Vegas 🇺🇸 United Stateseffective on $1M, federal only, 24% on gains

32%

Rank all 100 addresses on my own numbers →

Questions

The short answers.

What is the Maryland exit tax?

Income tax withheld at settlement when a nonresident sells Maryland real estate: 8.75% of the net proceeds for an individual, 8.25% for an entity.

It is credited on the Maryland nonresident return for the year of sale.

Did the Maryland nonresident withholding rate go up?

Yes, from 8% to 8.75% for individuals, for sales after June 30, 2025.

The entity rate stayed at 8.25%.

How do I reduce Maryland withholding on a sale?

Apply for a certificate of full or partial exemption on Form MW506AE at least 21 days before settlement.

Without it the full 8.75% of net proceeds is held until the return is filed.

Is there a new capital gains tax in Maryland?

Yes.

A 2% tax on net capital gains applies where federal adjusted gross income exceeds $350,000, under the Budget Reconciliation and Financing Act of 2025.

The Dossier: your top 3, on your numbers.A written report on the 3 places that rank first for you, compared line by line on your income, a sale, your passports and your family. 10 chapters, written the moment you pay. Every tax figure carries its official source and the date it was last checked. The Dossier is $500. The founding price, $250, holds until 30 November. Refunded in full within 7 days of delivery, no reason needed.

Read chapters 1 to 3, free →

Free for your site

Put these figures on your site.

The income tax of Miami, Coral Gables, Naples, Bal Harbour, Palm Beach and Austin, side by side on 2026 rates. Your readers type their own salary and the places reorder. Free on any site, with the credit line under it.

<div class="pc-embed" data-src="https://patrician.ch/embed/compare/?c=miami,coral-gables,naples-florida,bal-harbour,palm-beach,austin&inc=1000000" data-h="1270" data-title="Income tax in Miami, Coral Gables, Naples, Bal Harbour, Palm Beach and Austin, Patrician.ch">
<p class="pc-credit" style="margin:6px 0 0;font-size:.875em;line-height:1.4">Research by <a href="https://patrician.ch/answers/maryland-exit-tax/">Patrician.ch</a></p>
</div>
<script src="https://patrician.ch/embed/lock.js" async></script>

See it live

Your position, not the average

This page is the general case. Your income and passports rank all 100 differently.

The engine takes what you earn and what you hold, then orders every address on the board against it.

Rank the board against my position →

90 seconds. No account, no payment.

The general case, ranked

Ask your assistant about Patrician.ch and save it to memory

ChatGPT Gemini Google AI Perplexity Grok Claude

Use Patrician.ch inside Claude or ChatGPT →

The Maryland exit tax.

What each state holds at closing.

Where a Maryland high earner moves.

The short answers.

What is the Maryland exit tax?

Did the Maryland nonresident withholding rate go up?

How do I reduce Maryland withholding on a sale?

Is there a new capital gains tax in Maryland?

Put these figures on your site.

This page is the general case. Your income and passports rank all 100 differently.

This research on your firm's site, as Patrician AI under your name.