How is the Maryland Agricultural Transfer Tax calculated at the time a...

Asked March 31, 2015, 4:48 PM EDT

How is the Maryland Agricultural Transfer Tax calculated at the time a property is sold?

Maryland

1 Response

Hello,

I'm including the statute but basically it is going to depend on the size of the property. The tax will be:

  • 20 acres or more will be 5%
  • less than 20 acres and land is unimproved ag land is 4%
  • less than 20 acres and is improved ag land is 3%.
There is also a 25% surcharge.

Below is the actually statutory language to aid you.

Thanks,

PG

Md. TAX-PROPERTY Code Ann. § 13-303 (2014)

§ 13-303. Rate of tax


(a) In general. -- The agricultural land transfer tax applies at the following rates:


(1) for a transfer of 20 acres or more of agricultural land, 5%;


(2) except as provided in item (3) of this subsection, for a transfer of less than 20 acres of agricultural land assessed for agricultural use or as unimproved agricultural land, 4%; or


(3) for a transfer of less than 20 acres of agricultural land assessed as improved agricultural land or agricultural land with site improvements, 3%.


(b) Transfers subject to more than a single rate. -- If an instrument of writing is subject to different rates of agricultural land transfer tax under subsection (a) of this section, the total agricultural land transfer tax due is computed separately for each portion of agricultural land to which a different rate applies.


(c) Reduction in rate. -- Except as provided by § 13-305(c)(2) of this subtitle, the agricultural land transfer tax determined under subsection (a) or subsection (b) of this section is reduced by 25% for each consecutive full taxable year before a transfer in which property tax on the agricultural land was paid on the basis of any assessment other than the farm or agricultural use assessment under § 8-209 of this article.


(d) Surcharge. --


(1) Except as provided in paragraph (2) of this subsection, in addition to the tax imposed under this section, a surcharge in an amount equal to 25% of the tax determined under subsections (a) through (c) of this section is imposed on an instrument of writing that transfers title to agricultural land.


(2) The surcharge imposed under paragraph (1) of this subsection does not apply to an instrument of writing that transfers property of 2 acres or less to be improved to a child or grandchild of the owner.