What if?
The same sale under different choices, each computed by the engine rather than estimated. Figures are the tax on the gain, so the rows stay comparable when a variant spans two tax years. Select one to load it into the calculator and read its full derivation.
Estimates only — this is not tax advice. Consult a CPA or enrolled agent before acting on these figures. The calculator does not model the alternative minimum tax, wash sales, like-kind exchanges, QSBS, installment sales, or state additions and subtractions. See what is out of scope.
Show your work — 0 steps, each with its rule and citation
How Maryland taxes a capital gain
Statutory authority: Md. Code, Tax-General 10-105(a) and 10-106, as amended by Ch. 604 of 2025; Comptroller 2025 Tax Rate Schedules I and II; Technical Bulletin 58 (retrieved 2 September 2026)
The county is the story, and the figure below leaves it out
Start with the caveat, because in Maryland it is the largest number on the page that is not on the page. All twenty-three counties and Baltimore City levy a local income tax, collected on the same Form 502, on the same Maryland taxable income the state ladder uses. Tax-General 10-106 fixes the permitted range at "at least 2.25% but not more than 3.30%", and for 2026 the Comptroller lists Worcester at the floor, Dorchester and Kent at the ceiling, and Baltimore City with fourteen counties at 3.20%. Anne Arundel and Frederick apply their own small bracket ladders inside that range.
Because the base is identical, the county rate reaches a capital gain dollar for dollar. On a $200,000 sale in a 3.20% jurisdiction that is $6,400 of local tax, sitting on a state charge of around $11,000 — call it half again on top. This calculator does not model the county layer, cannot know which county you live in, and says so in the caveats on every Maryland result. Take the state figure, find your jurisdiction in the Comptroller’s local rate table, and add that percentage of the gain yourself.
Your local rate follows where you live on the last day of the year, not where you work and not where the asset was. A Montgomery County resident selling a Delaware beach house pays Montgomery’s 3.20% on the gain.
Ten brackets, two of them new in 2025
Chapter 604 of the Acts of 2025 — the Budget Reconciliation and Financing Act — rewrote the state ladder for taxable years from 2025 onward. It now runs 2%, 3% and 4% on the first three thousand dollars, then a long 4.75% band, then 5%, 5.25%, 5.5%, 5.75%, and two bands added by that Act: 6.25% and a 6.5% top. The dollar amounts are written into the statute with no indexing clause, so they stay put until the General Assembly moves them.
Schedule I, for single and married-separate filers, holds the 4.75% band up to $100,000 and reaches 6.25% at $500,001 and 6.5% above $1,000,000. Schedule II, for joint returns, surviving spouses and heads of household, stretches the 4.75% band to $150,000, reaches 6.25% at $600,001 and 6.5% above $1,200,000.
What this means for a sale is that the low rates are cosmetic and the middle band does the work. The 4.75% band is so wide that a typical salary sits inside it, so a gain stacked on that salary is taxed at 4.75% until it crosses $100,000 of taxable income and then climbs a quarter-point at a time. The 6.25% and 6.5% bands are reached only by very large sales, or by ordinary incomes already in the high six figures.
The 2% surcharge is a cliff at $350,000 of federal AGI
The same 2025 Act added something no other state on this site has: a separate 2% charge on net capital gain, on top of the ordinary ladder, for anyone whose federal adjusted gross income exceeds $350,000. Two features of its design decide how much it costs.
First, it is charged on the whole gain, not on the income above the line. The statute says "an additional 2% of the amount of net capital gain included in the individual’s Maryland adjusted gross income", and the Comptroller’s Form 502CG simply carries the net gain to Form 502 and multiplies by .02. There is no phase-in. A filer with $349,999 of AGI pays nothing extra; a filer with $350,001 pays 2% of every dollar of the gain. Since the gain is itself part of AGI, a sale can be the thing that carries you over — and then the entire sale is in scope.
Second, the threshold is $350,000 "regardless of filing status", in the words of Technical Bulletin 58. A married couple filing jointly does not get $700,000. Two earners on $180,000 each are over the line before they sell anything.
The statute excepts a handful of assets. The one that matters to most households is a primary residence sold for less than $1,500,000, which this calculator applies when you enter a home sale with its price. Also excepted, but not something the calculator can see: breeding livestock where farming is more than half your income, land under a conservation or preservation easement, business property expensed under section 179, and affordable housing owned by a nonprofit. The charge falls only on net capital gain in the federal sense — long-term gain net of short-term loss — so a short-term flip is outside it, though the ordinary ladder still taxes it.
Managing the cliff is worth more than managing the brackets
Ordinary bracket planning does little in Maryland: the bands move a quarter-point at a time, and the county rate is flat, so splitting a disposal across two years shaves fractions of a percent. The cliff is different in kind. For a household that would land a little above $350,000 of AGI with the whole sale in one year, an instalment sale or a split across December and January can keep both years under the line, and that saves the full 2% of the entire gain rather than a sliver of it.
The Comptroller expects the surcharge to be covered by estimated payments. A sale in the year can therefore create an underpayment problem on Form 502D before it creates a tax bill, and nonresidents selling Maryland real property should note that the mandatory withholding at closing does not include the 2%.
Separate filers get the narrower schedule
One arrangement that catches people: a married filer filing separately in Maryland uses Schedule I, the same table as a single filer, while a head of household uses Schedule II with the joint filer. Married-separate is therefore the most expensive status for a Maryland gain of a given size, because it reaches 5% at $100,001 of taxable income rather than $150,001, with no offsetting relief on the surcharge, whose threshold is the same $350,000 for everyone.
What Maryland does not change
There is no preferential rate for long holdings and no percentage exclusion. The holding period matters to the surcharge only in that short-term gain is not "net capital gain", and matters to the ordinary ladder not at all.
Federal treatment is unaffected by any of this: Maryland simply adds three layers — ladder, surcharge, county — to a federal result computed exactly as it would be in any state. The state figure here stacks the gain on federal ordinary taxable income; Maryland’s own taxable income starts from federal AGI and applies its own additions, subtractions and a standard deduction of $3,350 or $6,700, none of which is modelled. The surcharge gate is tested against the federal AGI this calculator derives from what you enter. Treat the result as close for a straightforward salary-and-sale year and as a floor once the county rate is added.
A worked Maryland example
Every figure below is computed by the same engine that powers the calculator above, at the moment this page was built — not typed in by hand. When the tax-year data is updated, this example updates with it.
Exactly $350,000 of AGI: the surcharge stays off
A single filer in Maryland earning $150,000 sells long-held shares for a $200,000 gain. Federal adjusted gross income is exactly $350,000 — not in excess of it.
- Taxable income after deduction
- $333,900
- Taxable gain
- $200,000
- Tax owed without the sale
- $24,734
- Tax the sale added
- $35,700
- of which net investment income tax
- $5,700
- Total federal tax
- $60,434
- Maryland state tax
- $11,169.50
- Effective rate on the gain
- 17.85%
The state figure is the ladder alone, an effective rate a little under 5.6%: most of the gain sat in the 4.75% and 5% bands. The 2% surcharge does not apply, because $350,000 is not "in excess of" $350,000. Add your county’s 2.25% to 3.30% of the gain to this, and note how close the surcharge line is.
Caveats on this example (3)
- Net investment income was derived from capital gains and qualified dividends only. Interest, non-qualified dividends, rents, royalties and passive business income inside ordinaryIncome are also net investment income under IRC 1411(c) and are not counted here.
- Maryland: local income taxes are not modelled and apply on top of the state figure. Every Maryland county and Baltimore City levies a local income tax on the same Maryland taxable income, at 2.25% to 3.30% for 2026 (Tax-General 10-106; most jurisdictions are at 3.20%). It reaches capital gains in full and is NOT modelled. A state-only Maryland figure understates the bill by roughly half again.
- Maryland: the state taxable income base is approximated by federal ordinary taxable income. State additions, subtractions and deductions are not modelled.
Show the working — 15 steps, each with its citation
- Net short-term capital gain or loss for the year$0
Assets held one year or less. Taxed at ordinary rates if a net gain.
- Net long-term capital gain or loss for the year$200,000
Assets held more than one year. Eligible for the 0/15/20% rates.
- Standard deduction-$16,100
Adjusted gross income of $350,000 less $16,100.
- Taxable income$333,900
The figure the rate tables and the capital gain ceilings are both measured against.
- Ordinary income taxed at 10%$1,240
$12,400 of taxable income between $0 and $12,400.
- Ordinary income taxed at 12%$4,560
$38,000 of taxable income between $12,400 and $50,400.
- Ordinary income taxed at 22%$12,166
$55,300 of taxable income between $50,400 and $105,700.
- Ordinary income taxed at 24%$6,768
$28,200 of taxable income between $105,700 and $133,900.
- Ordinary income stacked below the long-term gain$133,900
Long-term gain is taxed by reference to where it sits ON TOP of $133,900 of other taxable income, not from the bottom of the rate table.
- Long-term gain taxed at 15%$30,000
Gain between the $49,450 zero-rate ceiling and the $545,500 15% ceiling.
- Net investment income tax threshold$200,000
Modified AGI of $350,000 against the $200,000 threshold for a single filer. This threshold is statutory and is not adjusted for inflation.
- Net investment income tax at 3.8%$5,700
3.8% of $150,000, the lesser of net investment income ($200,000) and the amount by which modified AGI exceeds the threshold ($150,000). Here the binding figure is the excess of modified AGI over the threshold.
- Maryland income tax on the gain$11,169.50
$200,000 stacked on $133,900 of other taxable income across a 10-bracket ladder topping out at 8.5%. Federal ordinary taxable income is used as the base; the state's own taxable income differs, so treat this as an approximation.
- Maryland 2% surcharge on net capital gain does not apply$0
Federal adjusted gross income of $350,000 is not above $350,000, so the 2% surcharge on net capital gain is not charged. It is a cliff: one dollar over the threshold would put the entire $200,000 in scope.
- Total tax$71,603.50
$71,603.50 on $350,000 of total income, an effective rate of 20.46%.
One more dollar of salary
The same sale, with salary of $150,001. Federal adjusted gross income is now $350,001.
- Taxable income after deduction
- $333,901
- Taxable gain
- $200,000
- Tax owed without the sale
- $24,734.24
- Tax the sale added
- $35,700.04
- of which net investment income tax
- $5,700.04
- Total federal tax
- $60,434.28
- Maryland state tax
- $15,169.51
- Effective rate on the gain
- 17.85%
The ladder figure moves by a few cents. The surcharge switches on and charges 2% of the entire $200,000 — $4,000 — for one dollar of extra income. That is the cliff, and it is the reason a Maryland seller near the line should look at timing before looking at anything else.
Caveats on this example (4)
- Net investment income was derived from capital gains and qualified dividends only. Interest, non-qualified dividends, rents, royalties and passive business income inside ordinaryIncome are also net investment income under IRC 1411(c) and are not counted here.
- Maryland: local income taxes are not modelled and apply on top of the state figure. Every Maryland county and Baltimore City levies a local income tax on the same Maryland taxable income, at 2.25% to 3.30% for 2026 (Tax-General 10-106; most jurisdictions are at 3.20%). It reaches capital gains in full and is NOT modelled. A state-only Maryland figure understates the bill by roughly half again.
- Maryland: the state taxable income base is approximated by federal ordinary taxable income. State additions, subtractions and deductions are not modelled.
- Maryland: the 2% surcharge on net capital gain is gated on FEDERAL adjusted gross income, which this calculator derives from the income and gains entered; the state's own adjusted gross income differs by its additions and subtractions. Excepted by statute but not identifiable here: gains on cattle, horses or breeding livestock where over half of gross income is from farming; land under a conservation, agricultural or forest preservation easement; property whose cost was deducted under IRC 179; affordable housing owned by a nonprofit; and assets held inside retirement accounts, which do not produce capital gain on a return in any case.
Show the working — 15 steps, each with its citation
- Net short-term capital gain or loss for the year$0
Assets held one year or less. Taxed at ordinary rates if a net gain.
- Net long-term capital gain or loss for the year$200,000
Assets held more than one year. Eligible for the 0/15/20% rates.
- Standard deduction-$16,100
Adjusted gross income of $350,001 less $16,100.
- Taxable income$333,901
The figure the rate tables and the capital gain ceilings are both measured against.
- Ordinary income taxed at 10%$1,240
$12,400 of taxable income between $0 and $12,400.
- Ordinary income taxed at 12%$4,560
$38,000 of taxable income between $12,400 and $50,400.
- Ordinary income taxed at 22%$12,166
$55,300 of taxable income between $50,400 and $105,700.
- Ordinary income taxed at 24%$6,768.24
$28,201 of taxable income between $105,700 and $133,901.
- Ordinary income stacked below the long-term gain$133,901
Long-term gain is taxed by reference to where it sits ON TOP of $133,901 of other taxable income, not from the bottom of the rate table.
- Long-term gain taxed at 15%$30,000
Gain between the $49,450 zero-rate ceiling and the $545,500 15% ceiling.
- Net investment income tax threshold$200,000
Modified AGI of $350,001 against the $200,000 threshold for a single filer. This threshold is statutory and is not adjusted for inflation.
- Net investment income tax at 3.8%$5,700.04
3.8% of $150,001, the lesser of net investment income ($200,000) and the amount by which modified AGI exceeds the threshold ($150,001). Here the binding figure is the excess of modified AGI over the threshold.
- Maryland income tax on the gain$11,169.51
$200,000 stacked on $133,901 of other taxable income across a 10-bracket ladder topping out at 8.5%. Federal ordinary taxable income is used as the base; the state's own taxable income differs, so treat this as an approximation.
- Maryland 2% surcharge on net capital gain$4,000
2% of the whole net capital gain, charged because federal adjusted gross income of $350,001 exceeds $350,000, regardless of filing status. This is a cliff, not a phase-in: the surcharge applies to every dollar of the gain, not to the income above the threshold. Excepted by statute but not identifiable here: gains on cattle, horses or breeding livestock where over half of gross income is from farming; land under a conservation, agricultural or forest preservation easement; property whose cost was deducted under IRC 179; affordable housing owned by a nonprofit; and assets held inside retirement accounts, which do not produce capital gain on a return in any case.
- Total tax$75,603.79
$75,603.79 on $350,001 of total income, an effective rate of 21.6%.
What this calculator does not cover for Maryland
The Maryland figure stacks your gain on your federal ordinary taxable income. Maryland computes its own taxable income with its own additions and subtractions, which are not modelled here — so treat the state number as a close approximation for a straightforward wage-and-sale situation, and as a rough one if your return carries significant state adjustments.
Full-year residency is assumed throughout. Part-year residents, non-residents, and gains sourced to property in another state all turn on rules this calculator does not model. The complete list of what is in and out of scope is on the methodology page.
Other states
- District of ColumbiaSeven brackets to 10.75%, among the highest rates in the country.
- VirginiaTop rate of 5.75% from just $17,000, on 1990 thresholds.
- DelawareSix brackets to 6.6%, on thresholds frozen since 2014.
See the full 2026 capital gains guide for the federal rules that apply wherever you live — the rate ladder, the net investment income tax, the home-sale exclusion and depreciation recapture — plus every state we currently cover.