Does Maryland Tax Federal Pensions (FERS, CSRS)? 2026

Updated October 29, 2026. Quick answer: Possibly, through the general exclusion only. The 2025 Maryland booklet does not name federal civil service annuities; the pension exclusion of up to $41,200 covers income from a plan “qualified under Sections 401(a), 403 or 457(b) of the Internal Revenue Code” for filers 65 or older or totally disabled.

What Maryland does with a FERS or CSRS annuity

QuestionWhat the Maryland documents say
What the source saysThe 2025 resident booklet does not name CSRS or FERS annuities; a federal civilian pension is covered only by the general pension exclusion if it is taxable pension income from an employee retirement system qualified under Sections 401(a), 403 or 457(b), and the only federal-government service named is public safety personnel of the United States.
Amount or limitPension exclusion of up to $41,200 for 2025, reduced dollar for dollar by Social Security and Railroad Retirement benefits received, and limited to the taxable pension actually included in federal adjusted gross income; separate subtraction of up to $15,000 for retired federal, Maryland or local public safety personnel.
Age or other testAge 65 or older, or totally disabled, or spouse totally disabled, on the last day of the tax year; the $15,000 public safety subtraction requires age 55 or older.
Change for 2026No 2026 change is printed in the state documents cited here.

In the Maryland documents’ own words

  • “The maximum allowable exclusion is $41,200” (2025 State and Local Tax Forms and Instructions (Resident Booklet))
  • “You were 65 or over or totally disabled” (2025 State and Local Tax Forms and Instructions (Resident Booklet))
  • “Up to $15,000 in income from” (2025 State and Local Tax Forms and Instructions (Resident Booklet))
  • “personnel of the United States (Federal government), Maryland, or a political subdivision” (2025 State and Local Tax Forms and Instructions (Resident Booklet))

How this differs from other pensions in Maryland

The booklet and Tax-General 10-209 apply one rule to all qualifying employee retirement system pensions and do not give federal civil service pensions separate treatment; the only federal-specific language is for public safety personnel and rangers of the United States. See also Does Maryland tax pensions? and military retirement pay.

FERS, CSRS and your TSP

The booklet says 401(k) and 403(b) plans qualify for the pension exclusion but an IRA does not; it does not mention TSP by name. For the Thrift Savings Plan itself, see state tax on TSP withdrawals and the TSP calculator.

What the Maryland documents leave open

No Maryland document cited here names CSRS, FERS or federal civil service annuities, so whether a federal annuity counts as a qualified plan for the exclusion is not stated. Confirm it with the Comptroller or a preparer. The TSP is not named in any document cited here.

Common mistakes

  • Counting Social Security twice. The exclusion is reduced dollar for dollar by Social Security and Railroad Retirement benefits received.
  • Using the public safety subtraction by mistake. The $15,000 subtraction is for retired public safety personnel aged 55 or older, not for civil service retirees as a class.

Related: Does Maryland tax pensions?, Maryland military retirement pay, and FERS, TSP and Social Security sequencing.

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Sources

Read from the state documents linked above on October 29, 2026. General information, not tax advice.