Tax Credit Information
Senior Citizen Supplement - Homeowners Property
Effective July 1, 2012, the Washington County Board of County Commissioners voted to ease the tax burden on homeowners age 65 and over that meet certain income qualifications. The credit applies to homeowner occupied residential properties, and supplements the State Homeowners’ Property Tax Credit program. Residents may apply by using the State’s Homeowners’ Property Tax Credit Application Form HTC-60. This form is used to determine eligibility for both the Washington County credit as well as the State of Maryland credit. The application will be processed and eligibility will be determined by the State Department of Assessments and Taxation.
The tax credit is based upon the amount by which the State of Maryland and Washington County real property taxes exceed a percentage of the homeowners’ combined income. Under the State of Maryland formula, the first $8,000 of income is excluded from the calculation. Washington County’s Senior Citizen supplemental tax credit may significantly increase the overall tax credit.
To assist homeowners who are impacted by large assessment increases, the State of Maryland, Washington County, and municipalities limit the annual taxable assessment increase for owner-occupied residential properties. This homestead tax credit is administered by the State and is automatically applied to all properties listed as “Principal Residence”. The Homestead Tax Credit rates are as follows:
- State of Maryland - 10%
- Washington County - 5%
- Municipalities - %5
If you are eligible but did not receive the credit or wish to learn more about the program, please contact SDAT at 301-791-3050 or visit their website at www.dat.state.md.us/sdatweb/homestead.html.
Veterans Tax Credit
Washington County homeowners classified as 50% - 100% service-connected disabled American veterans (and surviving spouses) may be eligible for real estate property tax credit. Click HERE for a copy of the tax credit ordinance. Click HERE for the application. For additional information on this program please call the State of Maryland Department of Veterans Affairs at 301-791-0356.
Residential, Non-Homeowner Occupied “Homestead” Property Tax Credit
The Residential, Non-Homeowner Occupied Homestead Tax Credit limits the increase in taxable assessments each year to a fixed percentage. Beginning July 1, 2010, Washington County limits taxable assessment increases to 10 percent over the previous year taxable assessment. (At present, the State of Maryland does not offer a Residential Homestead Property Tax Credit for non-homeowner occupied properties, and therefore this credit will not apply to your State of Maryland portion of your tax bill.) Eligibility is determined based on property use codes as established by the State Department of Assessments & Taxation. To request a review of your use status please call the State Department of Assessments and Taxation at 301-791-3050.
The Residential, Non-Homeowner Occupied Homestead Tax Credit will reduce the Washington County tax liability and will be reflected on the annual property tax bill. The credit is automatically applied to all eligible accounts. No application is necessary.
Maryland’s Homeowners Property Tax Credit program is administered by the State and the tax credits are granted to eligible homeowners of all ages. Applications for this program must be filed by September 1, of each year. The program provides tax credits for homeowners who qualify on the basis of their household income as compared to their tax bill.
Homeowner’s Credits are displayed on the tax bills. The amount of the credit will appear on the bill and reduces the tax amount due. If the credit is issued after the taxes are paid, a refund will automatically be made to the taxpayer. If you are anticipating a tax credit, but it has not been granted as of the due date of your taxes, pay the taxes in full to avoid interest and penalties.
For further information or to request an application form, contact SDAT at 1-800-944-7403, or visit their website at www.dat.state.md.us/sdatweb/htc.html.
This tax credit may be granted against the amount of County real property taxes, based upon the amount expended by a taxpayer for restoration or preservation of an historic property. A property must be an historic site designated on the master plan for historic preservation, or within a historic district designated on the master plan for historic preservation. The tax credit shall be in an amount equal to ten percent (10%) of the owner’s expense for certain restoration and preservation of any existing structure up to the total amount of County real estate property taxes. A credit of five percent (5%) of the owner’s expense shall be allowed for new construction attached to an existing historic structure.
The credit shall be allowed for the tax year immediately following the work or any portion thereof is completed, and any unused portion of this tax credit, may be carried forward for as many as 5 tax years, after which the credit lapses.
For information, please contact the Washington County Planning Department at (240) 313-2430.
This tax credit may be granted against the amount of Washington County real property taxes based upon the assessed value of qualified land and improvements. Property owners must commit to remain in agricultural related pursuits for a period of ten years. The property must be located within a designated agricultural preservation district.
The credit shall be allowed for the tax year immediately following application and approval. For information, please contact the Washington County Planning Department at (240) 313-2430.
Property Tax Exemptions
There are numerous types of Property Tax Exemptions available through the State, some of the most used include exemptions for: charitable or educational properties; dwelling house of blind individual, surviving spouse; dwelling house of disabled veteran, surviving spouse; government properties; and properties owned by religious organizations.
For a full list of available exemptions, please reference The Annotated Code of Maryland Tax Property Article Title 7, Subtitle 2. General Property Tax Exemptions as follows:
- 7-201. Cemeteries and mausoleum companies.
- 7-202. Charitable or educational purposes.
- 7-203. Chesapeake Bay Foundation.
- 7-204. Religious groups or organizations.
- 7-205. Community water systems.
- 7-206. Continuing care facility for aged.
- 7-207. Dwelling house of blind individual; surviving spouse.
- 7-208. Dwelling house of disabled veteran; surviving spouse.
- 7-209. Fire companies and rescue squads.
- 7-210. Government property.
- 7-211. Interest in government property.
- 7-211.1. Property used to heat, cool, or generate electricity for State.
- 7-212. Gunpowder youth camps.
- 7-214. Historical societies; war memorials.
- 7-215. Housing authority property.
- 7-216. Izaak Walton League.
- 7-217. Maryland Ornithological Society, Inc.
- 7-218. Nature Conservancy.
- 7-219. Personal property - Agricultural products.
- 7-220. Same - Aircraft.
- 7-221. Same - Bank property.
- 7-221.1. Same - Property used in processing deposits or loans.
- 7-222. Same - Business stock property.
- 7-223. Same - Farm implement property.
- 7-224. Same - Livestock property.
- 7-225. Same - Manufacturing property.
- 7-226. Same - Raw materials and products property.
- 7-227. Same - Property located in a residence.
- 7-228. Same - Savings and loan property.
- 7-229. Same - Tools of mechanics or artisans.
- 7-230. Same - Vehicles.
- 7-231. Same - Vessels.
- 7-232. Same - Voting system.
- 7-233. Scouts.
- 7-234. Veterans' organizations.
- 7-235. Maryland Vending Program for the Blind.
- 7-236. Refueling equipment or machinery.
- 7-237. Machinery or equipment used to generate electricity, steam for sale, hot or chilled water for sale.
- 7-238. Computer software and related documentation.
- 7-239. Certified coal pollution control facility; coal waste disposal power project.
- 7-240. Property of nonprofit organization engaged in containment of coastal and tidal oil spills.
- 7-241. Charles County Planning Commission.
- Subtitle 3. State Property Tax Exemption.
- 7-301. Personal property - State property tax exemption.
- 7-302. American Association of Blood Banks, Inc.
- 7-303. Licensed public airport on privately owned land.
- 7-304. Land trusts.
- 7-305. Harford Land Trust.
- 7-401. Rolling stock property
Approximately 3,600 acres in Washington County are within three state-designated Enterprise Zones. Local and state incentives are available to new or expanding companies in these zones to promote growth of the industrial and commercial base. Each Enterprise Zone is approved by the state for a ten-year period.
Enterprise Zone Incentives Available to Qualifying Businesses
Local Real Property Tax Credits:
City and County property tax credits for up to ten years on capital investments.* Credit of 80% on increases in assessed value of real property for the first five years, decreasing by 10% annually for the remaining five years.
State Income Tax Credits:
State income tax credits for creating new jobs. One time credit of $1,000 for most new jobs. Credits for hiring "disadvantaged" employees (vouchered by the State): first year, $3,000; second year, $2,000; third year, $1,000.
*Note: Businesses seeking local property tax credits must apply to the Economic Development Commission prior to completing the construction or rehabilitation project. Property tax credits may not be granted retroactively.
The following is a list of Hagerstown-Washington County's specific Enterprise Zones:
To qualify for Enterprise Zone benefits, a business must be located within the zone and meet minimum requirements for job creation and for capital investment. In addition, there are restrictions on certain business types.
Minimum Capital Investment: (construction/rehabilitation of real property)
- $5,000 Airport Zone; Hagerstown's Central Business District; and Hancock.
- $50,000 Outside of Hagerstown's Central Business District.
Minimum Job Creation:(permanent, full time positions)
- 1 new job Airport Zone; Hagerstown's Central Business District; and Hancock.
- 5 new jobs Outside of Hagerstown's Central Business District.
New Jobs Tax Credit
The New Jobs Tax Credit Program provides eligible companies with a six-year tax credit against County real and personal property taxes.
In order to qualify for the program, a business must:
- either construct or expand its operations in Washington County by a minimum of 10,000 square feet;
- employ at least 25 persons in new permanent full-time positions
located at the new or expanded premises in Washington County;
- pay 50% of those new jobs at least 150% of the Average Weekly Wage per Washington County Worker as reported by the Maryland Department of Labor, Licensing, and Regulation at the end of the previous calendar year.
A business is not eligible for the tax credit program if:
- it has moved the operations which are located on the new or expanded premises from another county in Maryland, including Baltimore City;
- the business has been given a tax credit or exemption for the new orexpanded premises during the same taxable year under any other state or
- the business' primary operations at the new or expanded premises is related to the restaurant, retail, hospitality or warehouse distribution
- the business' operations are not consistent with the County's
Comprehensive Land Use Plan.
The amount of the New Jobs Tax Credit a business may claim against County taxes imposed on the assessed value of the new or expanded premises is:
- 52% during the first and second taxable years in which the credit is allowed;
- 39% during the third and fourth taxable years in which the credit is allowed; and,
- 26% during the fifth and sixth years in which the credit is allowed.
Contact the Economic Development Commission to learn more:
Foreign Trade Zone Benefits
Nearly 1,800 acres of prime industrial/commercial properties are located within the Washington County, Maryland Foreign-Trade Zone (FTZ). Buildings and sites are available for development with an array of amenities including: rail, airport runway access, superior interstate visibility, municipal water and sewer, and natural gas.
What is a FTZ?
FTZs are sites designated by the Foreign-Trade Zones Board in which special
United States Customs Service procedures may be used. These procedures allow domestic activity involving foreign items to take place prior to formal Customs entry. Duty-free treatment is accorded items that are reexported and duty payment is deferred on items sold in the U.S. market.
A Few FTZ Benefits . . .
Imports may enter and be held in a FTZ without Customs duties. Duty is paid only when those imports are shipped into U.S. Customs territory.
- Customs duties are not paid on merchandise reexported from a FTZ.
- Duties are not owed on labor, overhead or profit attributed to FTZ production operations.
- FTZ users can pay the duty rate on component material or merchandising produced from component material, whichever is lower.
- No duty is owed on in-bound zone-to-zone transfer of FTZ merchandise.
- Tangible personal property held in an FTZ for export is not subject to state and local taxes and ad valorem taxes.
- Materials used/consumed in FTZ processing are generally not subject to duties.
Click here for FTZ locations in Washington County.
For more information about the FTZ Program or Washington County's FTZ, contact:
Hagerstown-Washington County Economic Development Commission
Other FTZ Resources: