Maryland payroll taxes for employers (2026)

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Maryland's Division of Unemployment Insurance charges new employers 2.60% on the first $8,500 of each worker's 2026 wages (the state says new employer rates may range from 1.0% to 2.6%), and Maryland taxes income at 2.00% to 6.50% plus a county tax (Comptroller of Maryland 2026 withholding memo, checked October 2026). The date to plan around is January 1, 2027, when FAMLI paid leave contributions of 0.9% of wages begin.

SUTA wage base
$8,500
New employer SUTA rate
2.60%
State income tax
Yes
Minimum wage
$15.00
On this page

What makes Maryland payroll harder than it looks

Every one of Maryland's 23 counties and Baltimore City levies a local income tax that employers withhold. For 2026 the rates run from 2.25% in Worcester County to 3.30% in Dorchester and Kent counties. That 3.30% is also the default when an employee has no valid Maryland address on file, so a missing address costs the worker money. Anne Arundel and Frederick counties use tiered rates, and the memo lists a 7.0% nonresident rate. Our Maryland county tax rate page goes through each one.

  • New top state brackets: 6.25% and 6.5% apply from 2026 to single filers above $500,000 and $1,000,000.
  • Out-of-state contractors: a foreign construction contractor pays the Maryland construction industry average, never below the new employer rate. The state did not publish the figure.
  • Table A again: 2026 uses the same rate table as 2025, with a range of 0.30% to 7.50% and no surcharge listed.
  • Minimum wage $15.00, with a $3.63 tipped cash wage.
  • Final pay: due on or before the day wages would have been paid had the job continued (Lab. and Empl. 3-505). A written policy can limit payout of accrued leave.
  • No state PEO license, according to Harbor Compliance (secondary).

Maryland employer payroll facts at a glance

Maryland employer payroll facts, 2026
ItemMaryland rule or rateOfficial source
SUTA taxable wage base (2026)$8,500source
New employer SUTA rate2.60% (state page: new employer rate may range 1.0% to 2.6%)source
New employer rate, constructionOut-of-state (foreign) construction contractors: Maryland construction industry average, not below the new employer rate; figure not published
SUTA rate range0.30% to 7.50%
Surcharges and admin feesnone listed (Table A in effect for 2026, same as 2025)
2027 rates published?no
Unemployment agencyMaryland Department of Labor, Division of Unemployment Insurancesource
State income tax withholdingYes. State brackets 2.00% to 6.50%; new 2026 top brackets 6.25% and 6.5% (single over $500,000 and $1,000,000). Plus county local tax 2.25% (Worcester) to 3.30% (Dorchester, Kent; default with no valid address). Nonresident rate 7.0%. Anne Arundel and Frederick use tiered local rates. Supplemental rule not in memo.source
Paid leave or disability programsMaryland FAMLI: contributions start Jan 1 2027 at 0.9% of wages up to the Social Security wage base ($192,300 in 2027 per SSA), split 0.45% employer / 0.45% employee (may withhold up to 50%); employers under 15 total employees remit only 50% of the rate; statutory cap 1.2%; first remittance due Apr 30 2027; benefits begin by Jan 3 2028; rate for 2028 announced from Nov 2027. No 2026 cost.source ; source
Minimum wage 2026$15.00source ; source
Tipped cash wage 2026$3.63
Minimum wage 2027none announced
New hire reportingWithin 20 days of date of hire; electronic filers two monthly transmissions 12 to 16 days apartsource
Pay frequency ruleBiweekly or semimonthly (DOL payday table)
Final paycheck ruleFired or quit: on or before the day wages would have been paid had employment continued (Lab. & Empl. 3-505); accrued leave payout can be limited by written policysource;section=3-505&enactments=false
Workers comp requiredEach employer must secure compensation for all covered employees (Lab. and Empl. 9-402). unconfirmed: definition of covered employee and any exemptions not read todaysource;section=9-402&enactments=false
Local income taxesyes: all 23 counties and Baltimore City levy local income tax withheld by employers (2.25% to 3.30% in 2026)
PEO license or registrationno state PEO license per Harbor Compliance (secondary)

Checked October 16, 2026 against the official sources linked in each row.

Maryland employer cost for one $50,000 worker

Maryland's $8,500 base keeps the state unemployment line low. This is the 2026 math for a new employer at the 2.60% top of the new employer range.

Employer cost of one Maryland employee earning $50,000, 2026 (new employer)
LineHow it is figuredAnnual cost
Social Security6.2% x $50,000$3,100.00
Medicare1.45% x $50,000$725.00
FUTA0.6% x $7,000$42.00
Maryland SUTA2.60% x $8,500 wage base$221.00
Total employer payroll taxSum of the lines above$4,088.00

Source: IRS Publication 15 (2026); Maryland Department of Labor, Division of Unemployment Insurance. Checked Oct 2026. State and county income tax are withheld from the employee and are not included.

A new employer assigned the 1.0% bottom of the range would pay 1.0% x $8,500 = $85.00 instead. See the full 2026 SUTA list for other states.

Estimated yearly cost to employ this person
$0

Planning for FAMLI contributions in 2027

Family and Medical Leave Insurance contributions begin January 1, 2027 at 0.9% of wages up to the Social Security wage base, which is $192,300 for 2027. The split is 0.45% employer and 0.45% employee, and you may withhold up to half. Employers with fewer than 15 total employees remit only 50% of the rate. The first remittance is due April 30, 2027, benefits begin by January 3, 2028, and the law caps the rate at 1.2%. There is no FAMLI cost in 2026.

The same employee in 2027 with FAMLI (15 or more employees, half deducted from the worker)
LineHow it is figuredAnnual cost
2026 employer taxes (table above)FICA, FUTA and SUTA at 2026 rates$4,088.00
FAMLI employer share0.45% x $50,000$225.00
Estimated 2027 employer costSum of the lines above$4,313.00

Source: Maryland Department of Labor FAMLI contribution page. Checked Oct 2026. 2027 SUTA rates and wage base were not yet published, so the 2026 figures stand in.

Opening Maryland payroll accounts

  1. Get a federal EIN.
  2. Register for unemployment insurance in the Maryland Department of Labor's BEACON employer portal (employer.beacon.labor.md.gov). The department's new employer guide walks through it.
  3. Register for withholding with the Comptroller of Maryland, and collect each employee's county of residence so the local rate is right.
  4. Report new hires within 20 days of hire (electronic filers may send two monthly transmissions 12 to 16 days apart).
  5. Arrange workers comp. Lab. and Empl. 9-402 requires each employer to cover all covered employees.
  6. Before January 2027, set up FAMLI contributions in your payroll system.

If you searched for State of Maryland payroll because you are a state employee, this page covers private employers; your pay questions go to your agency's payroll or human resources office. If your Maryland company has a remote employee in another state, such as New Jersey, that state's withholding and unemployment rules usually apply to that worker.

Maryland payroll services and PEOs

The two tests for any provider here: does it assign the county from the employee's address and flag the 3.30% default, and is FAMLI on its 2027 roadmap? Compare prices on our payroll software rankings, and if you want benefits bundled, see PEOs ranked by score and typical PEO fees per employee. Hiring across the Potomac too? See Virginia payroll taxes.

Frequently asked questions

What is the Maryland SUTA rate for new employers in 2026?
The Maryland Department of Labor lists 2.60% on the first $8,500 of wages, and says new employer rates may range from 1.0% to 2.6%. That is $221 per employee at 2.60%.
What are the Maryland county income tax rates for 2026?
From 2.25% (Worcester County) to 3.30% (Dorchester and Kent counties), per the Comptroller of Maryland 2026 withholding memo. 3.30% is also the default when an employee has no valid address. Anne Arundel and Frederick use tiered rates.
When does Maryland FAMLI start and what does it cost?
Contributions start January 1, 2027 at 0.9% of wages up to the Social Security wage base ($192,300 in 2027), split 0.45% employer and 0.45% employee. Employers under 15 employees remit 50% of the rate. The first payment is due April 30, 2027.
How much payroll tax does a Maryland employer pay on a $50,000 employee?
$4,088.00 in 2026 for a new employer at 2.60%: $3,100 Social Security, $725 Medicare, $42 FUTA and $221 Maryland SUTA. From 2027, FAMLI adds $225 if the employer has 15 or more employees and withholds the employee half.
When is a final paycheck due in Maryland?
On or before the day the wages would have been paid had employment continued, for both quits and terminations (Maryland Labor and Employment 3-505).
Sources (12)
  1. Maryland Department of Labor: UI trust fund and tax rate tables (checked Oct 16, 2026)
  2. Maryland Department of Labor: BEACON employer portal (checked Oct 16, 2026)
  3. Maryland Department of Labor: New employer: get started (checked Oct 16, 2026)
  4. Comptroller of Maryland: 2026 Maryland state and local withholding information (checked Oct 16, 2026)
  5. Maryland Department of Labor: FAMLI: make contributions (checked Oct 16, 2026)
  6. Maryland Department of Labor: FAMLI FAQs (October 2025) (checked Oct 16, 2026)
  7. Maryland Department of Human Services: New hire FAQs (checked Oct 16, 2026)
  8. Maryland General Assembly: Labor and Employment 3-505 (checked Oct 16, 2026)
  9. Social Security Administration: Contribution and benefit base (checked Oct 16, 2026)
  10. IRS: Publication 15 (Circular E), 2026 (checked Oct 16, 2026)
  11. dol.gov/agencies/whd/minimum-wage/state (checked October 2026)
  12. mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gle§ion... (checked October 2026)

This page is general information, not tax, legal or accounting advice. Rules and rates change, so check the official source linked above before you file or sign a contract. Read our disclaimer.