According to the Maryland, "The wages earned by a spouse of a nonresident U.S. service member may be exempt from Maryland income tax under the Military Spouses Residency Relief Act, when the spouse of the service member is not a legal resident of Maryland. "
The spouse of the service member may be exempt from Maryland income tax on income from services performed in Maryland if:
- the service member is present in Maryland in compliance with military orders
- the spouse is in Maryland solely to be with the service member
- the spouse maintains domicile in another state.
To claim tax-exempt from Maryland withholdings:
A spouse whose wages are exempt from Maryland income tax under the Act may claim an exemption from Maryland withholding tax by completing form MW507 AND a MW507M. Complete new exemption forms yearly.
To claim a refund of taxes withheld from your Maryland income, follow these steps in the program:
- State Section
- Edit Nonresident Maryland state return
- Basic Information
- Complete all sections regarding the military. Be sure to select Yes to 'Was Maryland tax withheld in error from your Maryland income?'.
- Save
Military Spouse income may be taxable on your state return where you file as a resident.