Why do Maryland Counties Also Charge an Income Tax?

[NorthBeachPerso]

Looks like residents of La Plata and Indian Head get to pay an additional tax rate above the rest of Charles County as well. Although, La Plata appears to have very good schools so maybe its worth it???

https://www.charlescountymd.gov/sit...ners/resolutions/2015-07 Budget Ordinance.pdf

Those are incorporated municipalities so also have a town based property tax. That is to pay for services the County doesn't provide such as police services, planning and zoning, snow removal, etc. I'm not positive but the County property tax rate for those towns should be lower (that's called the tax differential) than in the rest of the County.

It is, look on Page 18, residents of the municipalities pay a lower (not much) County property tax rate. In Calvert the two Towns County property tax rate is 33.6 cents lower.

http://mgaleg.maryland.gov/Pubs/BudgetFiscal/2013-Tax-Differential-tax-rebates.pdf

Schools are a County function not a municipality's so that has nothing to do with either one.

 

[NIU_Huskies]

Those are incorporated municipalities so also have a town based property tax. That is to pay for services the County doesn't provide such as police services, planning and zoning, snow removal, etc. I'm not positive but the County property tax rate for those towns should be lower (that's called the tax differential) than in the rest of the County.

It is, look on Page 18, residents of the municipalities pay a lower (not much) County property tax rate. In Calvert the two Towns County property tax rate is 33.6 cents lower.

http://mgaleg.maryland.gov/Pubs/BudgetFiscal/2013-Tax-Differential-tax-rebates.pdf

Schools are a County function not a municipality's so that has nothing to do with either one.

So what you are saying is that La Plata and Indian head actually pay less? Interesting, i read it to mean they were paying an additional tax rate.

I'm learning more and more about Charles County taxes.

So if schools are a County function then why does La Plata have better rated schools than those in Waldorf or other cities?

 

[NorthBeachPerso]

So what you are saying is that La Plata and Indian head actually pay less? Interesting, i read it to mean they were paying an additional tax rate.

I'm learning more and more about Charles County taxes.

So if schools are a County function then why does La Plata have better rated schools than those in Waldorf or other cities?

The total property tax load is higher in both towns, remember they're paying a Town rate and a, somewhat lower, County tax rate. Add them together and the total rate is higher than in the unincorporated areas of the County like Waldorf. You sound like you've come from a state where there are always local governments (towns, townships, then Counties). Maryland isn't like that, the two forms of local government are Counties and municipalities (only 157 of those in the entire state).

Schools are schools, their ratings stem from who lives there and attends them. The La Plata schools are just one redistricting away from being bad.

 

[NIU_Huskies]

The total property tax load is higher in both towns, remember they're paying a Town rate and a, somewhat lower, County tax rate. Add them together and the total rate is higher than in the unincorporated areas of the County like Waldorf. You sound like you've come from a state where there are always local governments (towns, townships, then Counties). Maryland isn't like that, the two forms of local government are Counties and municipalities (only 157 of those in the entire state).

Schools are schools, their ratings stem from who lives there and attends them. The La Plata schools are just one redistricting away from being bad.

Thanks for further explaining it.

Correct, i spent most of my life in Illinois. I was a renter and never a homeowner until last year so i was never concerned with property taxes before. Although, places like Will, DuPage, and Cook Counties in Illinois are known to have very high property taxes.

 

[vince77]

Thanks for further explaining it.

Correct, i spent most of my life in Illinois. I was a renter and never a homeowner until last year so i was never concerned with property taxes before. Although, places like Will, DuPage, and Cook Counties in Illinois are known to have very high property taxes.

People in these incorporated towns can pick up the phone and talk to the mayor, town manager, public works, police chief. It's a town atmosphere, some people prefer that style of government.

 

[BernieP]

NY charges county tax, PA charges school income tax through the employer. In the long run, 8% really isn't outrageous. Having lived in several states myself, MD (St. Mary's Co), IL (Grundy Co) and currently Nebraska (Douglas Co) when you look at the tax structures a a whole, they are all pretty close. My home in MD property tax was 3600, same value here in Nebraska 10,000. Income taxes there 6.84 %, here 8%.

PA has a state income tax and a local / school income tax (last I checked that was 1%. State tax isn't more than 4. You get two real estate tax bills, the county/township and the school system. The county + township bill is typically moderate compared to the school tax. The only saving grace in PA is a quirk in the law, all the houses in the county have to be assessed (re-assessed) at the same time. They tax office at the county level isn't big enough to assess the entire county in one year.
So for the schools or the township and county to increase revenue, they have to vote for a tax rate increase. They can't hide behind the "reassessment"

NJ probably has it the worst. The real estate tax bills there are unreal. The income tax was instituted to help some of the heavier taxed counties to offset their taxbill
And the income tax went up form the original 2%.

You can't avoid taxes, unless you want to pay fees.

 

[PeoplesElbow]

I understand your first point, but i wouldn't consider the average home price (single-family and townhomes) of $225-250k in Charles County to be cheap or accessible for any family bringing home a gross income of less than $75,000. Those are rather high-priced homes compared to most of the U.S.

I agree with your 2nd point. A personal property tax every year on a vehicle is excessive. You already have to pay for yearly registration and yearly vehicle inspections. However, even when you factor that in, it doesn't make up for the income tax discrepancy between MD and VA. A VA resident who owns a vehicle still pays less in taxes than a MD resident who owns a vehicle.

The registration fees, inspection fees, drivers license fees are generally much lower than they are in Maryland. My moms license is actually free since she is over 65.

 

[BernieP]

Thanks for further explaining it.

Correct, i spent most of my life in Illinois. I was a renter and never a homeowner until last year so i was never concerned with property taxes before. Although, places like Will, DuPage, and Cook Counties in Illinois are known to have very high property taxes.

oh you pay property taxes when you rent, you just can't deduct them on your federal tax return. Land lords just pass on increases in the form of higher rent.

 

[intertidal]

oh you pay property taxes when you rent, you just can't deduct them on your federal tax return. Land lords just pass on increases in the form of higher rent.

As they must to recover their expenses. Expect rent increases in Calvert very soon when property taxes increase.

 

[intertidal]

As a one-year old resident of Maryland, can someone explain to me why Maryland has a "state" income tax rate and then each county in Maryland gets to charge its own income tax rate (Charles County is 3.03%)?

I assume most Maryland citizens fall in the 4.75% state income tax bracket ($3,000 - $100,000), since it appears to be the catch-all bracket. So if you live in Charles County you are paying 7.78% in income taxes. That's absurd!

Is the general "state" income tax not going back to the counties? We already pay property taxes which are supposed to fund the county's services. Of which, Charles County has the 2nd highest property tax rate of all counties in Maryland, which i find interesting considering Montgomery County has better schools.

I've never heard of a local income tax until Maryland. I've lived in Virginia, California, Illinois, Indiana, etc.

Has there always been a "county" income tax? Has anyone in Maryland politics every suggested getting rid of it? Just trying to get educated on Maryland tax rules and what led to their current existence.

It is absurd - your instincts are correct. What posters have failed to point out is that the county income tax is determined by a small handful of local yokels - who may well "need" your money to pay for their salary and benefits or massive tax breaks for their friends and supporters/donors. If the tax rate was determined entirely by the state legislature, there would be some level of checks and balances and transparency that do not exist at the local level.

 

[NorthBeachPerso]

As a one-year old resident of Maryland, can someone explain to me why Maryland has a "state" income tax rate and then each county in Maryland gets to charge its own income tax rate (Charles County is 3.03%)?

I assume most Maryland citizens fall in the 4.75% state income tax bracket ($3,000 - $100,000), since it appears to be the catch-all bracket. So if you live in Charles County you are paying 7.78% in income taxes. That's absurd!

Is the general "state" income tax not going back to the counties? We already pay property taxes which are supposed to fund the county's services. Of which, Charles County has the 2nd highest property tax rate of all counties in Maryland, which i find interesting considering Montgomery County has better schools.

I've never heard of a local income tax until Maryland. I've lived in Virginia, California, Illinois, Indiana, etc.

Has there always been a "county" income tax? Has anyone in Maryland politics every suggested getting rid of it? Just trying to get educated on Maryland tax rules and what led to their current existence.

One question I didn't answer, an oversight, was if the Counties didn't get funds from the State portion of the income tax. The answer is no. At least not directly. Yes, some of it will come back in the form of State Aid For Police or grants or other transfers but it won't be source designated.

 

[ltown81]

I am all for having taxes under as local control as possible.

Meaning..I would rather have a 4.**% state rate, and the rest be up to the county I live in (who decides what services to offer and taxes to offset) then pay a 8% or whatever state tax rate and nothing local. When it all goes to the state, it disproportionately ends up in points north (i.e. Baltimore/PG County).

Also keep in mind that local income tax rates will vary based on what that county's property tax is. Meaning a county can have low poperty tax or high income tax..or vice versa.

 

[LightRoasted]

If I may ...

An "income tax" is noting but theft of a portion of a person's labor, ie wages. It also ensures that a lot of people are kept at a level where they just can't seem to get ahead. I can't understand why people accept this theft and condone it.

 

[bilbur]

There was an article on MSN today that showed the value of a dollar in every state. MD was 3rd worst due to the high cost of housing, high tax rates, and the high cost of living. On the up side we ranked at the top for average salaries so if you are lucky enough to be close to the average salary you probably aren't hurting too bad but if you are retired on a fixed income this probably isn't the place you want to retire. My parents are retired here and the only reason they can afford it is because their house is paid off.

 

[bilbur]

If I may ...

An "income tax" is noting but theft of a portion of a person's labor, ie wages. It also ensures that a lot of people are kept at a level where they just can't seem to get ahead. I can't understand why people accept this theft and condone it.

Because I enjoy driving on paved roads, having a military to ward off foreign threats, having a jail to put bad people in, and having a school for children to learn. I could do without giving my money to the lazy people or illegals but all I can do about that is vote for people I feel will spend my tax money responsibly.