If you just bought a property in Maryland, there is nothing that you need to do right now to qualify for the Maryland Homestead Tax Credit.
The property taxes you pay are calculated based upon the assessed value of your property. If the assessed value goes up, your property taxes go up.
The Maryland Homestead Tax Credit operates to limit how much your property taxes can go up each year, if you live in the property as a principal residence. A homeowner pays no property tax on the amount of any increase of the assessed value that is above a cap.
The cap is the lower of 10% or the number set by your local government. Maryland’s State Department of Assessments and Taxation (SDAT) has an example of how this works on their website.
As a new purchaser of a property in Maryland, SDAT will mail you a homestead application when the new deed is recorded and their records have been updated. After you receive the application, you can mail it in, fax it in, or file electronically. Once you have filed the application, you should check the status with the SDAT Real Property Data Search page.
For additional information on the application process, see Joe’s post “MD homestead tax credit eligibility application deadline is Dec. 31.”