Update on Maryland Estate Tax

by Pillsbury Winthrop Shaw Pittman LLP

Maryland Governor Martin O’Malley has signed into law H.B. 739 (the “New Law”), which contains revisions to the Maryland estate tax law. Specifically, the New Law gradually increases the Maryland estate tax exemption amount over the next five years until the Maryland estate tax exemption is equal to the Federal exemption. Additionally, beginning in 2019, portability will apply to the Maryland estate tax exemption, so that any Maryland estate tax exemption not used at the death of a spouse may be used at the surviving spouse’s death. By increasing the estate tax exemption amount and eventually allowing portability, the New Law increases the number of estates that will pass free of Maryland estate tax.

The Old Law
Before the New Law, the determination of Maryland estate tax payable for a decedent’s estate was calculated allowing the estate the benefit of a $1,000,000 exemption. Under the old law, a taxable estate that exceeded $1,000,000 would have owed Maryland estate tax. Portability did not apply to the Maryland estate tax exemption under the old law. Each spouse was limited to his or her own exemption amount upon his or her death, and if it was not used in the first spouse’s estate, it was lost.

Maryland Estate Tax under the New Law
Under the New Law, the determination of Maryland estate tax payable for a decedent’s estate will be calculated allowing the estate the benefit of an exemption of the “applicable exclusion amount” in effect at the time of the decedent’s death. The applicable exclusion amount is set to increase gradually over the next five years as follows:

Decedent dying on or after: Applicable exclusion amount:
January 1, 2014 and before January 1, 2015 $1,000,000
January 1, 2015 and before January 1, 2016 $1,500,000
January 1, 2016 and before January 1, 2017 $2,000,000
January 1, 2017 and before January 1, 2018 $3,000,000
January 1, 2018 and before January 1, 2019

For the estate of a decedent who dies on or after January 1, 2019, the applicable exclusion amount will equal the federal applicable exclusion amount. The federal applicable exclusion amount is indexed for inflation, but is currently $5,340,000 plus the deceased spousal unused exclusion. The inflation-indexed applicable exclusion amount in 2019 is estimated to be $5,900,000 plus the deceased spousal unused exclusion.

Beginning in 2019, the Maryland estate tax exemption will be portable between spouses. If any Maryland estate tax exemption is unused at the death of the first spouse to die (as, for example, where the first spouse to die has insufficient assets to take full advantage of his or her exemption), then at the death of the surviving spouse, he or she may use the deceased spouse’s unused exemption. With portability, beginning in 2019 a married couple will have an estimated combined Maryland estate tax exemption of $11,800,000.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Pillsbury Winthrop Shaw Pittman LLP | Attorney Advertising

Written by:

Pillsbury Winthrop Shaw Pittman LLP

Pillsbury Winthrop Shaw Pittman LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.