Quick Answer
County taxes in Maryland range from 2.25% to 3.30% of income, while Indiana counties charge a flat rate from 0.5% to 3.38%. These are withheld directly from your paycheck based on where you live, not where you work, adding roughly $90-330 monthly to tax withholding for a $60,000 salary.
Best Answer
Sarah Chen, Payroll Tax Analyst
Best for employees who live in Maryland or Indiana and want to understand their county tax withholding
How county income taxes are withheld from your paycheck
County income taxes in Maryland and Indiana work differently from most states — they're withheld directly from your paycheck like federal and state taxes. Your employer withholds based on where you live, not where you work. So if you live in Baltimore County but work in Anne Arundel County, you pay Baltimore County's rate.
In Maryland, county tax rates range from 2.25% (Worcester County) to 3.30% (Montgomery County). Indiana's county rates range from 0.5% to 3.38%, with most counties charging between 1% and 2%.
Example: $60,000 salary in Montgomery County, MD
Let's say you earn $60,000 annually and live in Montgomery County, Maryland (3.30% county tax rate):
Your total tax withholding breakdown would be:
How rates vary by county
Maryland County Tax Rates (2026)
Indiana County Tax Rates (2026)
Key factors that affect your county tax
What happens if you move during the year
If you move between counties mid-year, you'll typically owe prorated county taxes to both locations. Your employer will withhold based on your current address, but you may need to make adjustments when filing your return.
For example, if you live in Howard County, MD (3.20% rate) for 8 months then move to Harford County (2.52% rate) for 4 months:
What you should do
1. Verify your address with HR: Make sure your employer has your correct home address for withholding purposes
2. Check your paystub: Look for a "county tax" or "local tax" line item to confirm the correct rate is being withheld
3. Plan for moves: If you're relocating within the state, factor the county tax difference into your housing decision
4. Use our calculator: Our paycheck calculator includes county tax rates for Maryland and Indiana to show your exact take-home pay
Key takeaway: County taxes in Maryland and Indiana add 0.5% to 3.38% to your total tax burden, costing $25-170 monthly on a $60,000 salary. The rate depends on where you live, not where you work.
Key Takeaway: County taxes in Maryland and Indiana are withheld from your paycheck based on where you live, adding $25-170 monthly in taxes for a $60,000 salary depending on your county's rate.
County tax rates and monthly costs for major counties in Maryland and Indiana
| State | County/City | Tax Rate | Monthly Cost ($60k) | Monthly Cost ($80k) |
|---|---|---|---|---|
| Maryland | Montgomery | 3.30% | $165 | $220 |
| Maryland | Prince George's | 3.20% | $160 | $213 |
| Maryland | Baltimore City | 3.20% | $160 | $213 |
| Maryland | Anne Arundel | 2.81% | $141 | $187 |
| Maryland | Worcester | 2.25% | $113 | $150 |
| Indiana | Marion (Indianapolis) | 2.90% | $145 | $193 |
| Indiana | Lake | 1.77% | $89 | $118 |
| Indiana | Allen | 1.23% | $62 | $82 |
| Indiana | Hamilton | 0.97% | $49 | $65 |
| Indiana | Porter | 0.50% | $25 | $33 |
More Perspectives
Sarah Chen, Payroll Tax Analyst
Best for people who recently moved to or within Maryland/Indiana and need to understand county tax changes
What changes when you move to Maryland or Indiana
If you recently moved from another state to Maryland or Indiana, county income tax is likely a new concept. Unlike most states that only have state income tax, these two states allow counties to impose their own income tax that's withheld directly from your paycheck.
The key difference: you'll see an additional line item on your paystub for "county tax" or "local income tax." This isn't replacing any other tax — it's an additional tax on top of federal and state.
Example: Moving from Virginia to Maryland
Let's say you earned $70,000 in Virginia, then moved to Fairfax County, MD:
Virginia (before move):
Montgomery County, MD (after move):
The county tax adds about $193/month to your tax burden — that's $2,316 annually.
Important timing considerations
Mid-year moves: If you moved during the tax year, you may owe prorated county taxes. Update your address with HR immediately so withholding adjusts for your remaining paychecks.
January 1st rule: Your county tax rate is typically based on where you live on January 1st. If you move in December, the new rate may not take effect until the following tax year.
State tax filing: You'll still need to file tax returns in both your old state (for income earned there) and your new state. The county tax appears on your new state return.
What you should do immediately
1. Update your W-4 and address with HR to ensure correct county tax withholding
2. Review your first few paystubs to confirm the county tax line item appears with the correct rate
3. Adjust your budget to account for the additional 0.5% to 3.38% in county taxes
4. Consider the total tax impact when choosing where to live within your new state
Key takeaway: Moving to Maryland or Indiana adds a new county income tax of 0.5% to 3.38%, increasing your total tax withholding by roughly $150-240 monthly on a $70,000 salary.
Key Takeaway: Moving to Maryland or Indiana introduces a new county income tax of 0.5% to 3.38%, adding $150-240 monthly to your tax withholding on a $70,000 salary.
Sources
- IRS Publication 15-T — Federal Income Tax Withholding Methods
- Maryland State Department of Assessments and Taxation — Maryland County Income Tax Rates
- Indiana Department of Revenue — Indiana County Income Tax Information
Related Questions
Reviewed by Sarah Chen, Payroll Tax Analyst on February 28, 2026
This content is for educational purposes only and is not a substitute for professional tax advice. Consult a qualified tax professional for advice specific to your situation.