Maryland Spouse Domiciled Differently: Filing and Tax Implications
When spouses reside in different states, Maryland tax filing becomes more complex. Maryland requires residents to file a Maryland resident return (Form 502) and nonresidents to file Form 505. If one spouse is domiciled in Maryland and the other is not, special rules apply for allocating income, deductions, and credits.
Filing Status and Form Selection
- If you are married and filing jointly for federal taxes, you may still file separate Maryland returns if one spouse is domiciled outside Maryland.
- Use Form 502 for the spouse domiciled in Maryland.
- Use Form 505 for the spouse domiciled outside Maryland.
- Both spouses must report their respective incomes and deductions on their own state return.
Income Allocation Rules
- Wages, salaries, and tips: Allocate to the spouse who earned the income.
- Interest, dividends, and investment income: Divide equally between spouses if from joint accounts or ventures.
- Adjustments to income: Allocate to the spouse to whom the adjustment belongs.
- Capital gains: If federal AGI exceeds $350,000, Form 502CG must be filed for the spouse with income subject to Maryland tax.
Special Considerations
- Withholding taxes: Each spouse claims their own Maryland withholding (Form 502, Line 41 or Form 505, Line 44).
- Refundable Earned Income Credit (EIC): Claimed on the joint Maryland return; the Revenue Administration Division allocates it.
- Injured Spouse Claim: Use Form 502INJ if one spouse is an injured spouse; filing status must be Married Filing Jointly.
Part-Year Residents and Military Taxpayers
- If you began or ended residence in Maryland during the year, mark “P” on Form 502.
- Military taxpayers with non-Maryland income should mark “M” and report non-Maryland military income.
Source:
Form 502
Form 505
Form 502CG
Form 502INJ
Resident Booklet Instructions
Disclaimer: Always verify with official Federal or State Department of Revenue Forms and Instructions for the most current guidance.