Maryland Inheritance Tax Exemptions

Quick answer: beyond the family-relationship exemptions, a $1,000 small-bequest exemption, life insurance paid to a named beneficiary, small estates, and most non-resident property all escape this tax too. Check the full relationship list in Rates & Who Pays.

Every exemption, straight from the Register of Wills

A small-bequest floor, regardless of relationship

Property passing to any one person totaling $1,000 or less owes nothing, even if that person is otherwise a taxable, non-exempt beneficiary — a modest gift to a friend or distant relative can clear this floor entirely.

Life insurance passes outside the tax

A life insurance policy paid directly to a named beneficiary — rather than to the estate itself — is exempt, regardless of who that beneficiary is.

Small estates get a clean pass

Property administered under a Small Estate proceeding is exempt from the inheritance tax entirely, on top of whatever relationship-based exemption might also apply.

Non-residents get a narrow but real exemption

The personal property of someone who didn't live in Maryland is exempt, except for tangible personal property physically located in the state — a non-resident's Maryland vacation home contents could still be reached, even though their out-of-state bank accounts wouldn't be.

Exemptions — frequently asked questions