For tax purposes, the State Department of Assessment and Taxation appraises real and personal taxable property at market value and certifies these values to local governments. Based on the assessment and property tax rates set by each county and incorporated municipality, local jurisdictions send out property tax bills in July or August of each year.
301 West Preston St., Baltimore, Maryland, March 2004. Photo by Diane F. Evartt.
For each county and Baltimore City, the Director of Assessments and Taxation appoints a supervisor of assessments nominated by the mayor of Baltimore, the county commissioners, or, under charter government, by the county council or the county executive with council approval.
Under the Department are four divisions: Finance and Administration; Information Technology; Real Property Valuation; and Taxpayer Services.
Under the Division are two units: Accounting, and Administration and Operations.
The automated data systems of the Department are administered and maintained by the Division. For each county and Baltimore City, the Division also designs and maintains systems for real property, corporate charters, local personal property, and tax credits. These include the Real Property Data System, which maintains ownership and value information about parcels of real property; Home Owners' and Renters' Tax Credits; residential and commercial Computer-Assisted Mass Appraisal (CAMA) software to organize data used in assessing property values; and the Maryland Business Entity System (MBES), a searchable database containing business names, offices and resident agents, personal property assessments, and organizational document information. The costs of departmental projects are divided equally between the Department and local jurisdictions.
On the Internet, the Department offers a searchable database for real and personal property assessments, tax maps, sales data, corporate charter and Uniform Commercial Code information.
Maryland's system of real property assessment has been based on 100 percent of the market value of the property since July 2001 (Chapter 80, Acts of 2000). To ensure the accuracy of assessments, the Division makes an annual assessment ratio survey by comparing actual sales with assessment levels in various subdivisions. This survey also determines how well local assessment offices are keeping pace with current property values.
Property owners are notified of any change in their assessment. Increases in value over the previous appraisal must be phased in over three years. For example, an increase of $30,000 would add $10,000 per year to the old value.
Once assessments are certified by the State Department, local governments apply local tax rates to convert them into tax bills. Tax bills and collections are administered by local government finance or treasurer's offices.
Maryland law provides for a three-tier administrative appeal process: the Supervisor's Level Hearing; the Property Tax Assessment Appeals Board; and the Maryland Tax Court. Where assessment questions are involved, the Real Property Valuation Division participates in all court proceedings. The Division also provides clerical assistance to several local Property Tax Assessment Appeal Boards. Brochures explaining the assessment process and related matters, such as appeals and tax credits, are available on the Internet, and at each local assessment office.
Under the Real Property Valuation Division are the local assessment offices. These include an office in each county and in Baltimore City.
BUSINESS PROPERTY EVALUATION
Franchise taxes applicable to the net income of savings and loan associations and other financial institutions, and to the gross receipts of public service corporations, are administered by the Department. In addition, the Division administers the property tax component of the Enterprise Zone Property Tax Credit Program.
CHARTER UNIT
The reporting of all resident agents for service of process, the collection of the annual filing fee charged certain business entities, and the maintenance of a system for providing "certificates of status" needed in busines and commerce are responsibilities of the Unit.
The Unit is custodian of domestic charters for Maryland corporations and of qualifications and registrations for limited partnerships and foreign corporations. Specified fees are collected, and the personal property of such corporations is assessed by the Unit. Thereafter, the values are certified to the subdivisions for application of local tax rates and Personal Property Assessments. The Unit also is responsible for processing "ground rent" redemptions and registrations.
PROPERTY TAX-CREDIT PROGRAMS
HOMESTEAD PROPERTY TAX-CREDIT APPLICATION PROGRAM
RENTERS' PROPERTY TAX-CREDIT PROGRAM
© Copyright Maryland State Archives
OFFICE OF DIRECTOR
Appointed by the Governor, the Director of Assessments and Taxation administers and enforces the property assessment and tax laws of Maryland. The Director supervises assessment of all property in the counties and cities so that taxable property is assessed uniformly statewide. For both real and business personal property, the Director must establish a continuing method of assessment (Code Tax - Property Article, Title 2).
FINANCE & BUDGETING DIVISION
The Finance and Administration Division formed in 1992 as the Business Services and Finance Division from the merger of the Corporate Charter Division and the Corporate Assessments Division. It was renamed Finance and Administration in 1998 when responsibilities of these two divisions (along with Franchise Taxes, and Utility and Railroad Valuation) transferred to the Taxpayer Services Division. In March 2017, it received its present name. For the Department, the Division oversees accounting, procurement, and budget preparation.
OFFICE OF INFORMATION TECHNOLOGY
In 1993, the Information Technology Division was created as Management Information Services under the Taxpayer Services Division. In July 1998, Management Information Services was made a separate division. In August 2000, it was named Information Technology Division and later received its present name.
REAL PROPERTY VALUATION DIVISION
Since 1980, real property has been reassessed on a three-year cycle by the Real Property Valuation Division. Every year, one-third of all residential, commercial, industrial and agricultural properties in Maryland are reviewed. Assessors monitor and analyze real estate sales in Maryland and may conduct an exterior physical inspection of a property. Each county and Baltimore City is required to reimburse the State for the costs of conducting real property valuations. For FY2012 and FY2013, the reimbursement rate is 90 percent; for each year thereafter, 50 percent.
TAXPAYER SERVICES DIVISION
The Taxpayer Services Division began as Special Programs and reorganized under its present name in 1992. The Division oversees franchise taxes, tax credit programs, and the issuance of corporate charters in Maryland.
The Division oversees the annual reassessment of business personal property, including operating property of railroads and public utilities. With the Department, the counties and Baltimore City share the costs of the reassessments.
ENTERPRISE ZONE TAX-CREDIT PROGRAM
Through the Enterprise Zone Tax-Credit Program, businesses which locate or expand facilities in a designated enterprise zone receive local tax credits on increased assessments for new capital investments and improvements. In the first five years, tax credits may be received on 80 percent of the increase. A declining percentage (from 70 percent to 30 percent) is available over the next five years.
Anyone wishing to legally form a business does so through the Charter Unit. Such businessses include corporations, limited liability companies, limited partnerships, limited liability partnerships, and business trusts. Out-of-state entities doing business in Maryland also must register with the Unit.
In 2003, property tax credit programs provided more than $42 million in State-funded property tax credits to home owners and renters who qualified based on an income test.
HOME OWNERS' PROPERTY TAX-CREDIT PROGRAM
The Home Owners' Property Tax Credit Program is available to all low and fixed income home owners in Maryland, regardless of age. Credits are applied against the property tax bill if the tax exceeds a certain percentage of the home owner's gross income.
The Homestead Property Tax Credit Program limits the annual assessment increase against which a resident home owner pays State and local property taxes. Since 2007, to receive the credit, property owners must submit a one-time application certifying that the property is used as their principal residence. Taxpayers are not entitled to the Homestead Tax Credit on rental properties or vacation homes.
The Renters' Property Tax Credit Program applies to the permanently disabled; renters aged 60 or over; or renters who are under age 60, with dependent children, and who meet certain income requirements. The Program assumes that fifteen percent of rent paid is attributable to property taxes. If that portion exceeds a fixed amount in relation to gross income, the renter may receive a credit of up to $600.
Maryland Constitutional Offices & Agencies
Maryland Departments
Maryland Independent Agencies
Maryland Executive Commissions, Committees, Task Forces, & Advisory Boards
Maryland Universities & Colleges
Maryland Counties
Maryland Municipalities
Maryland at a Glance
Maryland Manual On-Line
Search the Manual
e-mail: mdmanual@mdarchives.state.md.us