Residency rules, sticky taxes, and first-year steps (2026)
2026.1 Edition · Revised 2026-07-25 · DomusDay Research
The move changes the rate; the record decides whether it sticks. Pennsylvania keeps taxing until domicile actually changes, and its 183-day statutory test stays live while any Pennsylvania abode is maintained. Below: what follows leavers, and the Maryland steps that build the record.
Every Maryland county (and Baltimore City) levies a mandatory local income tax of 2.25%–3.30% collected with the state tax. On top of the 6.5% state top rate, combined top marginal rates approach 9.8% — the county rate is set by where the taxpayer resides.
Source ↗Maryland levies an estate tax — $5,000,000 exclusion with spousal portability — and a separate 10% inheritance tax on property passing to recipients outside the exempt family classes. Nonresident decedents' Maryland real and tangible property stays within reach of both.
Source ↗A nonresident individual selling Maryland real property has 8.75% of the total payment withheld at settlement via Form MW506NRS (8.25% for entities) before the deed is recorded — a prepayment reconciled on the nonresident return, and it reaches former residents selling the old house after the move.
Source ↗Maryland is the easy half. Pennsylvania decides whether the move counts, and it decides on evidence — the two tests below stay live until the record closes them out.
The full rules, the audit program, and every source: the complete Leaving Pennsylvania guide →
Top-bracket rates differ by 3.43%: Pennsylvania at 3.07%, Maryland at 6.5% — an illustration at the top marginal rate, not an effective-rate calculation.
The first weeks in Maryland matter more than they look: each step below produces a dated document, and dated documents are what answer a Pennsylvania examiner years later. Do them early and the record starts on your side of the timeline.
The MVA requires an out-of-state driver's license to be updated to a Maryland license within 60 days of moving to Maryland; the prior license is surrendered at the appointment.
Source ↗Vehicles are titled and registered in Maryland within 60 days of the move; past the deadline, the MVA notes loss of the credit for titling tax paid to another state and possible citation for an out-of-state registration.
Source ↗Maryland residents register to vote online with an MVA-issued license or ID number, by mail, or in person — including at local boards of elections and MVA offices. AR 37 treats voter registration as one of the two most important domicile factors, so the Maryland registration is a dated marker on the arrival side.
Source ↗The Homestead Tax Credit caps growth in the taxable assessment of a principal residence at 10% a year or less (counties can set lower caps). A 2007 law requires a one-time application establishing that the dwelling is the owner's principal residence, occupied at least six months of the year — a dated domicile marker in state records.
Source ↗The separate Homeowners' Property Tax Credit caps property tax at a percentage of income for households with combined gross income of $60,000 or less and net worth under $200,000 (excluding the home and retirement savings), on the first $300,000 of assessed value. Annual application is due October 1; the dwelling is the principal residence occupied at least six months of the year including July 1.
Source ↗Registration requires coverage from an insurer licensed and approved to do business in Maryland, at minimums of $30,000 bodily injury per person, $60,000 per accident, and $15,000 property damage.
Source ↗Where bank accounts are maintained is an enumerated AR 37 factor — Maryland accounts opened on arrival are dated evidence of the new center of life.
Source ↗New Maryland physicians, dentists, and advisors create dated, located records on the arrival side of the ties AR 37 examines.
Where immediate family lives and where children attend school are enumerated AR 37 factors — Maryland enrollment and household records date the family's move.
Source ↗Items of sentimental value moved into Maryland speak to AR 37's most personal factor — the inbound move generates dated inventories.
Source ↗The statutory-resident test runs on the arrival side too: an abode held more than 6 months plus 183 days of presence makes a full-year resident, so day records date when Maryland residency began.
Source ↗The arrival year is filed on Form 502 marked part-year, with the dates of Maryland residence entered — the residence start date becomes part of the filing record.
Source ↗Everything Maryland asks of a new resident, on its own plate: the Moving to Maryland guide →
Every rule on this page traces to a statute, regulation, or agency publication, listed in full on each state's own plate.
2026.1 Edition · Revised 2026-07-25 · DomusDay Research