Unlock Savings with Maryland’s Homestead Tax Credit

If you own a home in Maryland, there is a simple, one-time step that can help protect you from big jumps in your property taxes over time: applying for the Maryland Homestead Tax Credit (often called the Homestead Exemption).

Many homeowners assume this happens automatically. It does not. The good news is that the application is straightforward, and once you are approved, your eligibility typically stays in place as long as the home remains your primary residence.

Below is a clear breakdown of what the credit is, why it matters, and exactly how to apply.

Key takeaways

• The Homestead Tax Credit helps limit how much your taxable assessment can increase each year on your primary residence.

• You must complete a one-time application to establish eligibility.

• Local caps vary by jurisdiction. For example, Anne Arundel County’s cap is 2% (and the City of Annapolis is 10%).

• Once approved, it generally stays with you as long as the home remains your primary residence.

What is the Maryland Homestead Tax Credit?

The Homestead Tax Credit is designed to help homeowners manage property taxes by capping the annual increase in the taxable assessed value of your principal residence.

Important note: this does not prevent your home’s market value from changing. Instead, it can reduce how quickly the taxable portion used to calculate your bill increases year to year.

Quick example (simple math)

Let’s say your home’s taxable assessment is $500,000 and it increases to $550,000.

• Without a cap, you could be taxed on the full $550,000.

• With the Homestead Tax Credit, your taxable increase may be limited based on the cap for your area, which can lower the taxable value used to calculate your property taxes.

The result: more predictability and protection against sharp increases.

Why the local cap matters (especially in our area)

Maryland’s statewide cap for the state portion is 10%, but your county and municipality can set a lower cap for their portion of your taxes.

For many of our clients, this is where the Homestead Tax Credit becomes especially valuable.

Here are a few examples from the most recent posted caps:

• Anne Arundel County: 2%

• City of Annapolis: 10%

• Highland Beach: 2%

• Baltimore County: 4%

Caps can change, so it’s always smart to confirm your jurisdiction, but these examples give you a sense of why filing the one-time application is worth it.

Who qualifies?

In general, the Homestead Tax Credit is intended for owner-occupied primary residences.

Here are the common eligibility themes:

• The home must be your principal residence.

• You generally must have lived in the home for at least six months of the year, including July 1, for the credit year (with limited exceptions).

• You can only claim it on one primary residence.

• You must file the one-time eligibility application.

If your situation is unique (you recently moved, you own multiple properties, the property is in a trust, etc.), you can still apply, but it’s worth double-checking details before submitting.

How to apply (step by step)

Step 1: Check if you already have an application on file

Before you do anything else, check your property record to see whether your Homestead application is already approved.

Look for a section that shows Homestead Application Status. If it says approved (or similar), you are likely all set.

If it shows No Application, you will want to apply.

Step 2: Gather what you need

You will typically want:

• Your SDAT Real Property Account/Identification Number

• The names of all owners on title

• Social Security Numbers for all homeowners (and spouses), as required by the application

Step 3: Submit the one-time application

Maryland now offers a streamlined online option through Maryland OneStop (recommended). You can also submit via a paper application if you prefer.

After you submit, keep a record of your confirmation. Processing time can vary, so checking your status later through the property database is smart.

What happens after you apply?

Once approved, your Homestead eligibility stays in place as long as the dwelling remains your primary residence.

If your circumstances change (for example, you move out and keep the property as a rental), it’s important to update the appropriate offices so your record stays accurate.

Common questions we hear

“Do I have to apply every year?”

No. The Homestead Tax Credit is generally a one-time application for that property, as long as it remains your primary residence.

“Is this income-based?”

No. This program is not based on income. (Maryland has a separate, income-based program called the Homeowners’ Property Tax Credit.)

“What if I just bought my home?”

New purchasers are often mailed information after the deed is recorded, but you can still be proactive and check your status and apply if needed.

“What if I live in part of the home and rent part of it?”

The application asks questions related to rental use. If you have any uncertainty, it’s worth getting guidance before submitting so everything is accurate.

Helpful Links:

Maryland OneStop – Homestead Tax Credit Eligibility Application

SDAT – Maryland Homestead Property Tax Credit Program info
SDAT Real Property Search (to check Homestead status)
SDAT – Application for Homestead Tax Credit Eligibility (PDF)
SDAT – 2025-2026 Tax Rates & Homestead Credit Caps (PDF)

SDAT – Homeowners’ Property Tax Credit Program (income-based, separate program

Need help?

If you want help finding your property account number, figuring out where to check your Homestead status, or confirming what applies to your situation, reach out anytime. We are happy to point you in the right direction.

Jen Holden, Realtor® | Principal
The Jen Holden Group of Compass
📱 443.803.7620 (m) | 📞 410.429.7425 (o)
✉️ jen@thejenholdengroup.com
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