Maryland charges a state transfer tax when a home is sold. Every county also charges recordation tax, and many add a county transfer tax. This guide covers who qualifies for the first-time buyer rules, what the contract can and cannot change, and where the counties differ. It is general information, not legal advice for your purchase. To see the taxes on a particular price, open our Maryland closing cost calculator with the first-time buyer box ticked.
What changes for a first-time buyer
On an ordinary Maryland sale the state transfer tax is 0.5% of the price. Real Property 14-104 presumes that the buyer and seller share the state and county transfer taxes and the recordation tax equally, unless the contract or another law says otherwise.
Tax-Property 13-203(b) and Real Property 14-104(c) change three things when the buyer is a first-time Maryland home buyer who will occupy the home as a principal residence:
- The state rate drops to 0.25% of the price.
- The seller pays all of the state transfer tax. The statute applies “notwithstanding any other provision of law” and gives no exception for a contract that says otherwise.
- The seller also pays all of the county transfer tax and the recordation tax, unless the buyer and seller expressly agree that the seller will not pay all of them.
For sellers, the lower state rate matters less than it sounds. Under the even split, a seller pays half of a 0.5% tax. Under the first-time rule, the seller pays all of a 0.25% tax, which at current rates comes to the same amount. The bigger change for the seller is the county transfer tax and recordation tax, which move from half to all when the contract is silent. A seller’s net sheet that assumed an even split can be off by thousands of dollars, so sellers and listing agents should ask at the offer stage whether the buyers qualify.
Who counts as a first-time Maryland home buyer
The test is narrower than “never owned a home”. Under the statute, a first-time Maryland home buyer is someone who has never owned residential property in Maryland that was their principal residence. In practice:
- You owned a home in another state. That home does not count against you, because the test looks only at Maryland property.
- You own or owned Maryland property you never lived in, such as a rental. The test counts only Maryland property that was your principal residence. Tell us about any Maryland property you own or have owned, so we can confirm how the test applies to you.
- You once owned and lived in a Maryland condo or house as your main home, even years ago. You do not qualify.
Four more conditions apply:
- Every buyer on the deed must qualify. If two or more people are buying, each one must be a first-time Maryland home buyer. The one exception is a person who is only a co-signer or guarantor of the purchase loan and will not live in the home, such as a parent helping with the mortgage.
- The home must be one you will live in. The rule covers improved residential property that the buyer will occupy as a principal residence. A vacant lot, a second home or a rental does not qualify.
- Each buyer gives a sworn statement. Each buyer (or the buyer’s agent) signs a statement under oath that they meet the test, or that they are a co-signer or guarantor who will not live in the home.
- Tax sales are excluded from the seller-pays rule. Real Property 14-104(c) does not apply to property sold at a tax sale.
A 2026 bill, HB 790, proposed replacing the half-rate rule with an exemption from the state transfer tax for first-time buyers who meet set requirements. It was not enacted: the legislature’s bill page shows no action after its February 2026 committee hearing, and the statute text we read on November 12, 2026 still showed the rule described here. Laws change, so check with us before you rely on this page.
What the contract can change
Read the tax clause in the sales contract, and any addendum, before you sign. The seller-pays rule for the county transfer tax and recordation tax gives way to an express agreement, and some contracts move part or all of those taxes back to the buyer. The state transfer tax on a qualifying sale stays with the seller. How the split works on an ordinary sale is explained in who pays transfer tax in Maryland.
The loan you take out to buy the home is generally not charged recordation tax. Tax-Property 12-108(i) exempts a purchase-money mortgage or deed of trust that the buyer gives on the home being bought, if it is signed and recorded within the time limits the statute sets. Recordation tax on the deed itself is worked out in steps of $500 of the price, and a part of a step counts as a whole one.
Worked example: Anne Arundel at its median price
Take an Anne Arundel County home at the county’s median sale price, $509,990. Under the default even split, the buyer’s share of the three taxes is $5,609.92.
Now make every buyer a first-time Maryland home buyer who will live in the home. The state transfer tax drops to $1,274.98, and the buyer’s share goes to $0. If the contract is silent, the seller pays that state tax, the county transfer tax of $5,099.90 and the recordation tax of $3,570. The calculator does the same sum for any county it covers and any price.
These are government taxes only. For a closing figure that includes title insurance and settlement charges, use our instant quote.
County by county
The state rule is the same everywhere in Maryland. What differs is the county transfer tax and whether the county adds a first-time buyer break of its own:
| Jurisdiction | County transfer tax | Extra break for first-time buyers |
|---|---|---|
| Anne Arundel County | 1%, or 1.5% of the whole price at $1,000,000 or more | None shown on the county’s tax page or in the state’s guide to local taxes |
| Baltimore City | 1.5% | None found for first-time buyers as such. A buyer who swears they will live in the home gets the first $22,000 of the price exempt from city recordation tax, and from city transfer tax too when the price is under $250,000 |
| Baltimore County | 1.5% | None found. A 2026 bill, HB 602, proposed one but was not enacted. Separately, the state’s guide to local taxes and the county’s rate page say the first $22,000 of the price is excluded from county transfer tax when the home will be the buyer’s principal residence; ask us whether your sale qualifies |
| Howard County | 1.25% | None for the general public. Howard County police officers, deputy sheriffs, fire and rescue members and Board of Education teachers have their own exemption on a first Howard County home purchase, with a different test from the state one |
| Prince George’s County | 1.4% | None for the general public in the state’s guide to local taxes. Some police officers, deputy sheriffs and county teachers have their own programs with separate rules |
| Calvert County | None | No county transfer tax to reduce; recordation tax still applies |
| Queen Anne’s County | 0.5% | The county’s tax rates page lists 0.25% for first-time Maryland home buyers who will live in the home |
Queen Anne’s County, which includes Kent Island, is the one county in this table whose own tax rates page lists a lower county transfer tax rate for first-time buyers. That rate does not appear in the state’s tables of local tax rates, so confirm it with us before you rely on it. On a qualifying sale the seller pays the state transfer tax in every case, and the county transfer tax unless the contract expressly says otherwise.
A first-time buyer who will live in the home may also qualify for these owner-occupant breaks, but on a first-time sale where the contract is silent the seller is paying all of the county or city taxes. In Baltimore City that means the lower bill is the seller’s. How Baltimore County’s exclusion is shared depends on county law and your contract, so ask us how it applies to your sale.
State law also lets each county and Baltimore City exempt first-time buyers from recordation tax. We have not found such an exemption in any jurisdiction in this table.
When the first-time rules are checked
The first-time rules depend on facts and papers gathered before settlement day, so it helps to raise them early:
- Before you sign the contract. Tell your agent you expect to be a first-time Maryland home buyer, and check who the tax clause says pays the county taxes. Buying without an agent? Our buying without an agent service can go through the contract with you.
- When the title file opens. Tell your settlement agent about every home you have owned, in Maryland or elsewhere, and who will be on the deed and the loan.
- When the Closing Disclosure arrives. For most home loans, federal rules say you must receive it at least three business days before closing, which leaves time to compare its tax lines with your contract. Taxes the contract leaves with the seller should not appear in your column.
- At settlement. Each buyer signs the sworn first-time buyer statement with the other closing papers. After settlement the deed goes for recording in the land records of the Clerk of the Circuit Court for the county where the home is. For an Anne Arundel home that is the Clerk of the Circuit Court for Anne Arundel County, Land Records Department in Annapolis.
We send wire instructions by email. Before you wire any money for settlement, confirm the instructions by calling our office at (410) 768-2300, the number on this website, never a number taken from an email. Our wire fraud page explains why.
Two property tax credits are worth knowing about as a first-time owner. The homestead tax credit does not carry over from the seller, so you apply for your own; Maryland requires whoever conducts your settlement to give you the application. The separate, income-based Homeowners’ Property Tax Credit can lower the tax you pay at settlement if it is approved before then. State law sets a window of 7 working days after the contract is signed to apply, while SDAT’s web page says to apply at least 30 days before settlement, so apply as soon as your contract is signed.
How we help
Our settlement agents are attorneys, and Maryland First Title has handled Maryland settlements since 1994. We prepare the settlement statement, which shows each transfer and recordation tax and who pays it, pay the taxes at settlement and send the deed for recording in the county where the home is. If you think you qualify as a first-time Maryland home buyer, tell us when you order title so the sworn statements and tax lines can be set up for it.
You can settle at our Glen Burnie office, or we come to you anywhere in Maryland at no extra cost, with weekend and after-hours times by appointment. Our residential settlement page explains the service, and the buyer’s checklist lists what to do before settlement day.