Fiduciary Tax for Individual Taxpayers

The Comptroller's Office is dedicated to making the process of filing and paying taxes, simple, safe and efficient. You may have questions before, during or after you file your return. We're here to help. This section supplies the latest information for the fiduciary taxpayer.

Filing your fiduciary tax return doesn't have to be complicated or confusing. This section will help you more easily navigate through the process of filing your returns, making payments and receiving refunds. As always, if you need assistance you can contact our helpful staff or visit one of our local offices. As you navigate through the process use the links at the bottom of each page. The following will get you started in the right direction:

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Fiduciary Tax Information

A fiduciary is a person who holds the legal title to real or personal property for the use and benefit of another, and includes a personal representative of a decedent's estate or a trustee of a testamentary or inter vivos trust ("living trust").

Fiduciaries are subject to the Maryland income tax and, dependent upon residency of the decedent, also either the local income tax rate or the special nonresident tax rate.

A fiduciary is subject to the local income tax, if the fiduciary is considered a Maryland resident. A fiduciary of an estate is a Maryland resident if the decedent of the estate was domiciled in Maryland on the date of the decedent's death.

A fiduciary of a trust is a Maryland resident if:

  • the trust was created, or consists of property transferred, by the will of the decedent who was domiciled in Maryland on the date of the decedent's death.
  • the creator of grantor of the trust is a current Maryland resident; OR
  • the trust is principally administered in Maryland.

If none of the above is applicable, then the fiduciary is considered a nonresident and is subject to the Maryland special nonresident tax.

Maryland follows the federal income tax treatment for fiduciaries of trusts and estates. Under the federal income tax rules, generally any income that is distributed by the fiduciary of the trust or estate during the tax year is not taxable to the trust or estate. Instead, that income is taxable to the beneficiary. Any income not distributed or partially distributed by the fiduciary of the trust or estate during the tax year is taxable to the fiduciary of the trust or estate.

Fiduciary Tax rates

The Maryland income tax is imposed on the Maryland taxable income of a fiduciary of an estate or trust. A fiduciary figures the Maryland income tax in much the same manner as an individual.

A fiduciary of an estate or trust is also subject to:

Either tax may be imposed on the Maryland taxable income of a fiduciary of an estate or trust.

A fiduciary is subject to the local income tax, if the fiduciary is considered a Maryland resident. A fiduciary of an estate is a Maryland resident if the decedent of the estate was domiciled in Maryland on the date of the decedent's death.

A fiduciary of a trust is a Maryland resident if:

  • the trust was created, or consists of property transferred, by the will of a decedent who was domiciled in Maryland on the date of the decedent's death;
  • the creator or grantor of the trust is a current Maryland resident; OR
  • the trust is principally administered in Maryland.

If none of the above is applicable, then the fiduciary is considered a nonresident and is subject to the Maryland special nonresident tax.

Fiduciary Tax Legislation

Administrative Release 16 - Fiduciaries, including Estates and Trusts

Donations of Conservation Easements

House Bill 187 (Chapter 19, Acts of 2007) and Senate Bill 219

This Act clarifies that the personal representative of an estate may donate a conservation easement on real property if the donation is authorized under the will. A fiduciary, or the trustee of a trust, may donate, or consent to the donation of, a conservation easement on real property if the donation is authorized under the governing instrument. The donation of a conservation easement on real property qualifies as a federal estate tax exclusion.

This Act becomes effective October 1, 2007 and can be applied retroactively to a conservation easement donation from an estate of a decedent who died on or after January 1, 1998.

Administrative Releases: Personal, Estate and Corporate Income Tax

Release # Title Revision/Effective Date
1 Military Personnel and Civilian Spouses - Both Residents and Nonresidents of Maryland Revised: 9/2011
2 Interstate Commerce Tax Act. Domestic and Foreign Corporations. Nexus Requirements. Apportionment of Corporate Net Income Revised: 9/2009
3  Nonresident Credits, Reciprocal Income Tax Agreements, Nonresident County Income Tax, and Nonresident with Maryland Resident Spouse Revised: 9/2011
4 Extension of Time for Filing Maryland Income Tax Returns and Estate Tax Returns Revised: 9/2011
5 Mutual Fund Distributions of Tax-Exempt Interest and Capital Gains from State and Local Obligations Revised: 9/2009
6 Taxation of Pass-Through Entities Revised: 12/2023
7 Some Aspects of the Subtraction Modification for Volunteer Travel Expenses Under Section 10-208 of the Tax-General Article. See Form 502V Revised: 9/2009
8 Treatment of Partner's Share of Income, Gain or Loss, from a Partnership When the Individual Partner Establishes or Abandons Maryland Residence Revised: 9/2008
9 Portion of Subpart F Income which may be subtracted from Corporation Taxable Income Effective: 9/2009
10 Maryland Taxation of Income from "Ginnie Maes" Effective: 9/2009
11 Income from Regulated Investment Companies which Invest in U.S. Government Obligations and Income from Repurchase Agreement Transactions Revised: 9/2009
12 Apportionment of Partnership Share of Income by Corporate Partners Revised: 9/2008
13 Tax Status of Interest Received from Federal, State and Local Obligations Revised: 8/2012
14 Interest Rates for Refunds and Delinquent Taxes Revised: 11/2019
15 Information Reporting on Sales of Real Estate Located in Maryland and Owned by Nonresidents Revised: 09/2007
16 Fiduciaries, Including Estates and Trusts Revised: 9/2011
17 Rescinded Rescinded: 12/31/2001
18 Net Operating Losses and Associated Maryland Addition and Subtraction Modifications Revised: 07/2013
19 Rescinded Rescinded: 08/31/2005
20 Income Tax Refunds and Credits: Limitations Revised: 9/2009
21 Income Tax Treatment of Employee Contributions under the Maryland Pension Pickup Program Revised: 9/2010
22 Apportionment of Income - Airlines Revised: 6/2022
23 Military Retirement Income Revised: 9/2009
24 Nonresident Professional Athletes and Entertainers Revised: 9/2008
25 Income Tax Treatment of Limited Liability Companies Revised: 9/2012
26 Procedures for Computer-Printed Substitute Forms Revised: 09/2022
27 Work, Not Welfare, Tax Incentive Act of 1995 with 1996, 1998, 2000, 2003, 2006, 2007 and 2008 Amendments (Employment Opportunity Credit) Revised: 9/2012
28 Rescinded Rescinded: 08/31/2005
29 Subtraction Modification for Volunteer Fire, Rescue or Emergency Medical Services Personnel Revised: 6/2011
30 Maryland Estate Tax Revised: 05/2013
31 Subtraction Modification for Police Auxiliary or Reserve Volunteers Revised: 9/2009
32 Maryland College Savings Plans Tax Benefits Revised: 01/2010
33 Tax Credits for Hiring Individuals with Disabilities Revised: 8/2012
34 Credit against Withholding Taxes for Tax-exempt Organizations Revised: 9/2010
35 Subtraction Modification for United States Coast Guard Auxiliary Members Revised: 9/2009
36 Tax Credit for Cost of Providing Commuter Benefits to Employees and the Commuter Benefits Act of 2000 and 2002 Revised: 9/2009
37 Domicile and Residency Effective: 9/2009
38 Decoupling from Federal Income Tax Laws Revised: 6/2022
39 Long-Term Employment of Qualified Ex-Felons Tax Credit Revised: 8/2012
40 Claim of Right Effective: 9/30/2006
41 Withholding on Designated Distributions from Retirement Plans Revised: 8/2012
42 502CR Part A - Claiming Credit for State and Local Taxes Paid to Other States Revised: 3/2019
43 Corporate Apportionment of Income Revised: 10/2022.
Estate-Inheritance-Fiduciary Tax FAQs

Fiduciary Filing Information

Both resident and nonresident fiduciaries who have Maryland taxable income and who are required to file a federal income tax return should use the Fiduciary Income Tax Return Form 504 to report and make payment of any income tax due of the estate or trust. Nonresident fiduciaries must also file Form 504NR which is used to calculate their nonresident tax. Fiduciary tax returns can be filed electronically.

If you are a nonresident who owns and is selling or transferring real property and associated tangible personal property in Maryland, you must make a tax withholding payment to the local Clerk of the Circuit Court or the Maryland Department of Assessments and Taxation (SDAT). The payment must be made before the deed or other instrument of transfer is recorded with the court clerk or filed with SDAT. For more information, see Sales of Real Property by Nonresidents.

For a calendar year estate or trust, the fiduciary must file and pay the income tax on or before April 15 of the next taxable year. For a fiscal year estate or trust, the fiduciary must file and pay the income tax on or before the 15th day of the fourth month following the close of that taxable year.

Completed forms should be filed electronically or mailed to:

Comptroller of Maryland
Revenue Administration Division
110 Carroll Street
Annapolis, Maryland 21411-0001

Estate and Fiduciary Forms

Filing Extension for Fiduciaries

A fiduciary may obtain an automatic six-month extension to file Form 504. The fiduciary should complete the worksheet on Form 504E, Application for Extension to File Fiduciary Income Tax Return, to determine whether a tax is due. The extension request must be filed on or before April 15. If the due date falls on a Saturday, Sunday or legal holiday, the return must be filed by the next business day. Fiscal year taxpayers must file the extension request by the 15th day of the fourth month following the close of the taxable year. Filing this form extends the time you can file your return, but does not extend the time to pay your taxes. Payment of the expected tax due is required by April 15, 2023.

The Form 510, Pass-through Entity Tax Return, only will allow a refund if there are no nonresident members and the amount on line 13 of the return is zero.

Refund Claims

Generally, a claim for a refund (amended return) must be filed within 3 years from the date the original return was filed or within 2 years from the date the tax was paid, whichever is later. A return filed early is considered filed on the date it was due.

If the claim for refund resulted from an IRS adjustment or final decision of a federal court which is more than 3 years from the date of filing the return or more than 2 years from the time the tax was paid, a claim for refund must be filed within 1 year from the date of the adjustment or final decision.

A claim for refund based on a federal net operating loss carryback must be filed within 3 years after the due date of the return for the tax year of the net operating loss.

510C

Effective tax year 2011, a pass-through entity may elect to file a composite Maryland income tax return Form 510C on behalf of qualified nonresident individual members. All members who qualify and elect to be included on the composite return must agree that the pass-through entity is their agent for the receipt of any refund or for payment of any tax due.