State Renters' Tax Credit with Local Option (Circuit Breaker)

State

Maryland

Year

2022

Variations in Receipt of Benefit

Benefit Varies with Income

Minimum Tax Amount Must be Paid

Benefit Type

Circuit Breaker

Benefit

The program provides a credit in the form of a direct payment to the applicant. The credit is the applicant's rent equivalent property taxes minus the sum of 2.5% of their prior year income between $4,000 and $8,000 and 5.5% of their income in excess of $8,000. Rent equivalent property taxes are considered to be 15% of rent payments. The total amount of the credit cannot exceed $1,000. For individuals over 60 or 100% disabled, the renters tax credit at its lowest threshold is offered for individuals with an annual gross income between $1 - $10,000 and paying more than $117 monthly for rent. The highest threshold for this benefit is for individuals with a prior year gross income between $69,000 - $73,000 and paying over $2,000 monthly for rent.

How is Benefit Disbursed

Direct payment to taxpayer

Eligible Property Type

Residential

Characteristics of Eligible Property

Only residential property is eligible for this program. The rented dwelling may be an apartment in an individual house or any type of apartment building, duplex, co-op, condominium, house trailer, or mobile home pad. If the dwelling is owned by a tax exempt, charitable organization or is exempt in any way from property taxation, a tax credit cannot be granted.

Eligibility Criteria

Age

Disability

Income Ceiling

Principal Residence

Renter

Wealth Limit

Description of Eligibility Criteria

The applicant must occupy the property as their principal residence for at least 6 months of the year. The combined net worth of the applicant and any co-tenants (including a spouse) cannot exceed $200,000. For individuals over 60, or 100% disabled, the maximum total income is $73,000. Total income includes all combined gross household income from all sources before deductions. This includes Social Security and all other retirement benefits as well as other income whether or not taxable for federal and state income tax purposes. Those under the age of 60 with one or more dependent children may be eligible if gross income is below the federal poverty threshold and does not receive federal or state rent subsidies. The income ceiling for an applicant and one dependent is $17,420 and up to $49,200 for a household of 9 people, including the applicant.

Local Option in Adoption of Program

Local government must take action to opt in

Local Option Regarding Program Features

Local option regarding program features

State Funding for Local Tax Loss

State reimburses all of the local government tax loss

Description of State Funding for Tax Loss

The state issues a refund check directly to the applicant.

Record ID

MD103_RR22

Footnotes

Credits are calculated based on the household combined income, which is defined as combined gross household income before deductions. This includes income from all sources, whether or not taxable for federal and state income tax purposes. It also includes Social Security as well as all other retirement benefits of the tax year. Renters have until 1 October annually to apply for the credit.

Sources

Md. Code Tax-Property § 9-102;
Md. Code Tax-Property § 9-402 (in effect for 2022)
Maryland Department of Assessments and Taxation, Renters' Tax Credit, Form RTC-1 (2022)
[https://dat.maryland.gov/SDAT%20Forms/2022RTCApplication_Rev0222.pdf Accessed 11/15/2023]
View Archived Source
Maryland Department of Assessments and Taxation, Renters' Tax Credit
[https://dat.maryland.gov/realproperty/Pages/Renters%27-Tax-Credits.aspx Accessed 11/15/2023]
View Archived Source

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