Inheritance Tax - Beneficiaries of Limited Means - Installment Payments
HB0098 would create a new provision in Maryland’s Tax-General Article requiring a register of wills to permit an installment payment plan for inheritance tax in limited circumstances. The bill applies when a beneficiary of limited means inherits eligible real property and paying the inheritance tax by the due date would force a sale of that property. Eligible real property is limited to the beneficiary’s primary residence or agricultural land that the beneficiary continues to use as agricultural land.
To qualify, the beneficiary must meet income-based limits tied to federal adjusted gross income: up to $125,000 for an individual, or up to $250,000 for spouses filing jointly, a surviving spouse, or a head of household. The beneficiary would apply to the register of wills on a form and in a manner specified by the register, and the register would set the installment schedule and payment amounts. The bill takes effect July 1, 2026, and applies to decedents dying on or after that date.
The bill would add a new section, § 7-218.1, to Maryland’s Tax-General Article and would change administration of the inheritance tax by giving registers of wills authority to approve installment payments for qualifying beneficiaries. Its practical effect is to provide relief from immediate tax payment obligations when those obligations would otherwise require the sale of a home or qualifying agricultural land. The measure affects beneficiaries of limited means, registers of wills, and estates involving eligible real property, while leaving the underlying inheritance tax in place.
Based on the bill text and the limited available context, the bill appears to be framed as a targeted relief measure for lower- and moderate-income heirs, especially those inheriting a home or family farm. There is no recorded vote or committee testimony in the provided material, so no formal support or opposition is documented here. The overall tone of the bill is remedial and protective rather than expansive, suggesting an intent to reduce hardship without broadly altering the inheritance tax system.
The main policy tension is between tax collection on the due date and preserving inherited property for beneficiaries who may not have liquid assets. Supporters would likely emphasize preventing forced sales of primary residences and agricultural land, while potential critics may question whether the income thresholds are too broad, whether installment plans could complicate tax administration, or whether the relief should be limited more narrowly. Another possible point of contention is the discretion given to the register of wills to set installment schedules and payment amounts.