Maryland has progressive state income tax rates from 2% to 5.75% PLUS county taxes of 2.25% to 3.2%, while Delaware charges progressive rates from 2.2% to 6.6%. Living in Delaware saves $2,450/year on $100k income vs Maryland. Delaware's biggest advantage: NO SALES TAX (vs MD's 6%). Delaware also has much lower property taxes (0.61% vs MD's 1.09%). Overall, Delaware offers significant tax advantages. The MD-DE border is popular for tax planning, especially for retirees.

By Daniel, Founder of CountryTaxCalc

Daniel has spent 5+ years researching tax systems across 95+ countries and all US states to make tax comparison accessible to everyone. For corrections, contact us.

Last Updated: April 2026

The Big Picture

🦀 Maryland

2-5.75%

Progressive + County Tax

State 2-5.75% + County 2.25-3.2%

🦅 Delaware

2.2-6.6%

Progressive

7 brackets, up to 6.6%

Typical Annual Savings

At $100,000 income:

$2,450

That is $204/month back in your pocket!

Tax Savings by Income Level

IncomeMD TaxDE TaxSavings10-Year
$50,000 $3,475$2,212$1,263$12,630
$100,000 $7,450$5,212$2,238$22,380
$200,000 $16,200$11,812$4,388$43,880
$500,000 $43,000$31,612$11,388$113,880
💡

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Moving from Maryland to Delaware? Multi-state returns are tricky—MD county tax, partial-year residency, DE no sales tax. Get matched with a CPA who specializes in MD/DE tax planning.

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Maryland Pros and Cons

✅ Pros

  • Better job market: Baltimore/DC access (3M+ metro vs Wilmington 720K)
  • Better schools: Montgomery County #2, Howard County #5 in US
  • More amenities: Baltimore culture, restaurants, sports teams
  • Chesapeake Bay: Crab, seafood, beach access (Ocean City)
  • Better transit: DC Metro, MARC trains

❌ Cons

  • Higher income tax: 8.95% combined (state + county) vs DE 5.2% costs $2,450 on $100k
  • Sales tax: 6% (vs DE 0%) costs $600/year on $10k spending
  • Higher property tax: 1.09% (vs DE 0.61%) costs $1,200-$4,800 more/year
  • Expensive: Overall 15% more expensive than Delaware
  • High cost of living: Housing, food, services all pricey

Delaware Pros and Cons

✅ Pros

  • NO SALES TAX: $0 vs MD 6% saves $600/year on $10k spending
  • Lower income tax: 5.2% effective (vs MD 8.95%) saves $2,450 on $100k
  • Much lower property tax: 0.61% (vs MD 1.09%) saves $1,200-$4,800/year
  • Corporate haven: LLC formation capital, business-friendly
  • Beach access: Rehoboth, Bethany Beach (Delaware beaches)

❌ Cons

  • Limited job market: Wilmington only 720K metro (vs MD 6M Baltimore/DC)
  • Smaller state: Fewer amenities, entertainment options
  • Limited transit: Car-dependent, no Metro
  • Commuter challenges: Long drives to Baltimore/DC
  • Higher income tax at high incomes: 6.6% vs MD 5.75% state (but county tax makes MD higher overall)

Frequently Asked Questions

Q: How much will I save moving from Maryland to Delaware?

On $100,000 income, Delaware saves $2,450/year in income tax (DE 5.2% vs MD 8.95% combined state + county). DE has NO SALES TAX (saves $600/year vs MD 6%). Property tax savings are massive: DE 0.61% vs MD 1.09%. On a $500k home, DE pays $3,050/year vs MD $5,450/year—difference of $2,400/year. Total savings: $5,450/year. Over 10 years: $54,500.

Q: Why do retirees move from Maryland to Delaware?

Tax savings and beach access. Delaware has lower income tax on retirement income (5.2% vs MD 8.95%), NO sales tax (vs MD 6%), and much lower property tax (0.61% vs 1.09%). For retiree with $80k pension + $400k home: DE saves $2,000 income tax + $400 sales tax + $1,640 property tax = $4,040/year. Plus Rehoboth/Bethany Beach proximity. Many MD retirees move to DE coastal towns.

Q: Is there significant Maryland to Delaware migration?

Yes, especially among retirees. In 2023, 8,472 people moved MD → DE (vs 4,134 DE → MD), net gain of 4,338 for Delaware. Migration drivers MD → DE: tax savings ($5,450/year at $100k), no sales tax, Delaware beaches, lower cost of living (15% cheaper). Reverse migration (DE → MD) driven by: job opportunities (Baltimore/DC), better schools, more amenities.

Q: Can I work in Maryland and live in Delaware to avoid MD taxes?

No—Maryland will tax MD-source income regardless of residency. If you work in MD but live in DE, you pay MD income tax on those wages. However, you save on: DE's no sales tax (vs MD 6%), lower property tax (0.61% vs 1.09%), and any non-MD income is only taxed by DE at lower rates. Best strategy: work remotely for non-MD company while living in DE.

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