Maryland Inheritance Tax Form Guide for Executors

If you've been named the executor of an estate in Maryland, one of your responsibilities is dealing with inheritance tax forms. Getting this wrong can delay the probate process, cost the estate money, and even put you personally at risk. Understanding how Maryland's inheritance tax form works and following the instructions correctly protects both you and the people who are supposed to receive their inheritance.

What Is the Maryland Inheritance Tax Form?

Maryland is one of the few states that charges both an estate tax and an inheritance tax. The inheritance tax applies to property passed from the deceased person (the decedent) to certain beneficiaries. The primary form you'll work with is the Form IH-61, which is the Maryland estate tax return used to report the value of the estate and calculate any tax owed. You may also need Form IH-90 for the inheritance tax assessment.

The inheritance tax rate in Maryland is 10% of the value of property transferred to beneficiaries. However, not every beneficiary has to pay. Close relatives such as a surviving spouse, children, grandchildren, parents, siblings, and other direct descendants are fully exempt from the inheritance tax. The tax typically applies to transfers to unrelated individuals, like friends or distant relatives.

Who Needs to File These Forms?

The executor (also called the personal representative) is responsible for filing the inheritance tax forms with the Register of Wills in the county where the decedent lived. If you've been appointed to handle the estate, this task falls on you not the beneficiaries. Even if the estate is small, you still may need to file paperwork to confirm that no tax is owed. You can read more about your duties as a personal representative handling inheritance documents.

When Do You Need to File the Inheritance Tax Return?

The inheritance tax return is generally due within 9 months of the decedent's date of death. If you need more time, you can request an extension, but the tax itself still accrues interest after the 9-month mark. Filing late without an extension can result in penalties and interest charges against the estate.

Many executors don't realize that the clock starts ticking the moment someone passes away not when you're officially appointed by the probate court. If you're still waiting for your appointment, you should still begin gathering the financial documents you'll need.

What Information Do You Need to Complete the Forms?

Before you sit down to fill out the inheritance tax forms, gather these documents:

Death certificate – You'll need certified copies (at least 5–10 is a safe number).
Last will and testament – If one exists, it determines who gets what.
Inventory of assets – Real estate, bank accounts, investment accounts, vehicles, personal property, business interests, and retirement accounts.
Appraisals – Real estate and valuable personal property may need a professional appraisal to determine fair market value at the date of death.
Outstanding debts and liabilities – Mortgages, credit cards, medical bills, and funeral expenses.
Beneficiary information – Full names, addresses, Social Security numbers, and their relationship to the decedent.
Prior gifts – Any gifts the decedent made within 2 years of death may need to be reported.

Having this information organized before you start makes the process much smoother. If you're unsure about how to handle the overall filing process, our guide on filing inheritance paperwork in Maryland probate court walks through the broader steps.

How Do You Fill Out the Inheritance Tax Form Step by Step?

Here's a general breakdown of what the filing process looks like:

Obtain the forms – Download Form IH-61 and any related schedules from the Maryland Comptroller's website or pick them up from your local Register of Wills office.
Report all estate assets – List every asset the decedent owned at the time of death, with its fair market value. This includes real property, financial accounts, vehicles, jewelry, and any business interests.
Identify exemptions and deductions – Deduct funeral expenses, administrative costs, debts owed by the decedent, and any property passing to a surviving spouse or qualifying charity.
Calculate the taxable estate – After deductions, the remaining value is the taxable estate. Maryland's estate tax exemption is currently $5 million (indexed for inflation). Estates below this threshold may not owe estate tax but could still owe inheritance tax to non-exempt beneficiaries.
Determine inheritance tax owed – Apply the 10% rate to shares going to non-exempt beneficiaries.
File with the Register of Wills – Submit the completed forms to the Register of Wills in the appropriate county.
Pay any tax due – Tax must be paid before the estate can be fully distributed. You can request a payment plan if the estate doesn't have enough liquid assets.

What Are Common Mistakes Executors Make With These Forms?

Executors who haven't handled an estate before often run into the same problems:

Underreporting asset values – Using outdated or estimated values instead of getting proper appraisals. The Comptroller's office can challenge your numbers.
Missing the filing deadline – The 9-month window goes faster than most people expect, especially while dealing with grief and other estate matters.
Confusing estate tax with inheritance tax – These are two separate taxes in Maryland. The estate tax is paid by the estate; the inheritance tax is technically owed by the beneficiary, though the executor is responsible for withholding and paying it.
Forgetting about exempt beneficiaries – Not realizing that transfers to a spouse, children, or parents are exempt from the inheritance tax can lead to unnecessary tax payments.
Not filing at all – Some executors assume that if the estate is small or the beneficiaries are all family members, no filing is needed. Maryland still expects a return even when no tax is due.
Distributing assets too early – Handing out inheritances before settling the tax liability can leave the executor personally responsible for unpaid taxes.

For estates that qualify as small estates, there may be a simpler path. Learn more about the small estate affidavit process to see if the estate you're handling qualifies.

Do All Estates Owe Maryland Inheritance Tax?

No. Several situations mean zero inheritance tax is owed:

All beneficiaries are exempt relatives (spouse, children, parents, siblings, etc.).
The estate's total value falls below the estate tax exemption threshold and no non-exempt beneficiaries are receiving property.
Assets pass directly to a surviving spouse or qualifying charitable organization.
The decedent's property was held in a trust that qualifies for exemptions.

Even in these cases, you should still file the appropriate forms to document that no tax is owed. This protects you from questions or audits later.

Can You Get Help Filing the Forms?

Yes, and for most executors, it's a good idea. A Maryland probate attorney can review your forms before you file, make sure you're claiming all applicable exemptions, and help you avoid costly errors. The cost of legal help is typically paid from the estate not out of your own pocket.

You can also contact the Maryland Comptroller's Office directly for questions about estate and inheritance tax forms, filing deadlines, and payment options.

How Long Does the Whole Probate Process Take?

Filing the inheritance tax form is just one part of settling an estate. The full probate timeline in Maryland depends on the estate's complexity, whether anyone contests the will, and how quickly assets can be valued and distributed. For a detailed look at timing, see our article on how long probate takes in Maryland after death.

Quick Checklist for Executors Filing Maryland Inheritance Tax Forms

✔ Obtain certified death certificates (5–10 copies).
✔ Locate the will and file it with the Register of Wills.
✔ Get professional appraisals for real estate and high-value items.
✔ Gather all financial statements and account information.
✔ Identify every beneficiary and their relationship to the decedent.
✔ Determine which beneficiaries are exempt from inheritance tax.
✔ Download the correct forms (Form IH-61 and related schedules).
✔ Calculate the estate's total value and applicable deductions.
✔ File the return within 9 months of the date of death.
✔ Pay any tax due before distributing assets to beneficiaries.
✔ Keep copies of everything you file for your records.
✔ Consider hiring a probate attorney to review your work.

Start by gathering the decedent's financial records this week. The sooner you have a complete picture of the estate's assets and debts, the easier it will be to file accurately and on time. If you feel overwhelmed, that's normal most executors have never done this before, and getting professional guidance early can save significant stress and money down the road.