Updated August 4, 2026. Quick answer for Maryland: Maryland charges a flat 10% — but the exempt list is unusually wide. Siblings are exempt in Maryland, which is rare, and so are stepchildren and former stepchildren. What is left in the net is largely nieces, nephews, cousins, friends and unmarried partners.
This is not the estate tax, and the difference decides who pays
An estate tax is charged to the estate on its whole value before anything is distributed. An inheritance tax is charged to each beneficiary on what they personally receive, at a rate set by how they were related to the person who died. Two people inheriting equal shares of the same estate can owe completely different amounts. The full comparison, and which states levy which, is on inheritance tax by state.
The rate
The inheritance tax rate is 10% of the clear value of the property that passes from a decedent.
— Md. Code, Tax-General §7-204(a)-(b)
In this section, “clear value” means fair market value minus expenses.
— Md. Code, Tax-General §7-204(a)
Who is exempt
The inheritance tax does not apply to the receipt of property that passes from a decedent to or for the use of: (i) a grandparent of the decedent; (ii) a parent of the decedent; (iii) a spouse of the decedent; (iv) a child of the decedent or a lineal descendant of a child of the decedent; (v) a spouse of a child of the decedent or a spouse of a lineal descendant of a child of the decedent; (vi) a surviving spouse of a deceased child of the decedent or of a deceased lineal descendant of a child of the decedent who was married to the child or lineal descendant of the child at the time of the child’s or lineal descendant’s death; (vii) a brother or sister of the decedent
— Md. Code, Tax-General §7-203
Two definitions in the same section widen that list further than it reads:
“Child” includes a stepchild or former stepchild. “Parent” includes a stepparent or former stepparent. “Surviving spouse” means a surviving spouse who has not remarried.
— Md. Code, Tax-General §7-203(b)(1)
A stepchild — and a former stepchild — is exempt. So is a former stepparent. A blended family that separated years ago can still be on the exempt side of this, which is not how most people would guess it works. Note the limit on the other side: a surviving spouse of the decedent’s deceased child is exempt only if they have not remarried.
Four more exemptions
§7-203(a) pension/benefit-plan annuity not taxable for federal estate tax purposes; §7-203(c) the first $500 passing under a will for the perpetual upkeep of graves; §7-203(d) life insurance proceeds payable to any beneficiary other than the estate of the insured; §7-203(e) 501(c)(3) organisations and transfers deductible under IRC §2055.
The life-insurance one matters in practice: proceeds paid to a named beneficiary are outside the tax, but proceeds paid to the estate are not.
What actually reduces this
Inheritance tax is charged on what passes to a beneficiary, so the levers are about who receives and how, not about shrinking the estate at the last minute. Assets with a named beneficiary or a survivorship feature still count in most of these states — do not assume a transfer-on-death designation escapes it. The instruments themselves: transfer-on-death deeds by state, and the beneficiary-designation mistakes that cost the most. If probate is the live question rather than the tax, what probate costs in Maryland is the arithmetic on that side.
Rates and exemptions read at the state’s own revenue department or statute and cited above, not legal or tax advice. Inheritance tax turns on a relationship and a date of death this page cannot see, and legislatures change these figures — check the current year before you act on a number. We sell nothing on this page and earn nothing from it.