$LevyIO

Coverdell Education Savings Account in Maryland 2026

Calculate your coverdell education savings account tax savings in Maryland. With Maryland's 5.75% top state tax rate, your combined savings are higher.

Maryland Tax Overview

State Income Tax
5.75%
progressive
Sales Tax
6%
avg combined: 6%
Property Tax Rate
1.05%
Median Income
$90,203

8 brackets. County taxes add 2.25-3.20%. Both estate AND inheritance tax. Low standard deduction.

Maryland Income Tax Brackets (Single)

2%
$0 - $1,000
3%
$1,000 - $2,000
4%
$2,000 - $3,000
4.75%
$3,000 - $100,000
Your bracket
5%
$100,000 - $125,000
5.25%
$125,000 - $150,000
5.5%
$150,000 - $250,000
5.75%
$250,000 +
$535
Est. Total Savings
$2,000
Max Deduction
Tax-Free
Deduction Type
26.8%
Combined Tax Rate

Coverdell Education Savings Account Savings Calculator for Maryland

$
$

Federal Savings

$440

22% bracket

Maryland State

$95

4.75% rate

Total Savings

$535

26.8% combined

At a 26.8% combined tax rate in Maryland, every $1,000 in deductions saves you $268 in taxes.

Savings by Tax Bracket in Maryland

10%
$738
12%
$838
22%
$1,338
24%
$1,438
32%
$1,838
35%
$1,988
37%
$2,088

Includes 4.75% Maryland state tax on top of federal savings.

Eligibility Requirements

Parents saving for K-12 or college education

  • 1$2,000 annual limit
  • 2Beneficiary under 18
  • 3MAGI limits apply

Maryland residents should verify that this deduction is also recognized on their state tax return for additional savings of up to 5.75%.

Common Mistakes to Avoid

  • !Exceeding contribution limits
  • !Not using for qualified expenses
  • !Forgetting to claim the deduction on your Maryland state return (missing up to 5.75% additional savings)

Maryland Filing Tips

Total tax includes state and county. County tax adds significantly. Both estate and inheritance taxes apply. Low standard deduction makes itemizing worthwhile. Retirement income subtraction available for 65+.

Required Tax Forms

Form 5498-ESA

File these forms with your federal tax return to claim the coverdell education savings account. Maryland may require additional state-specific forms.

Other Tax Deductions in Maryland

Student Loan Interest Deduction

Education

~$669
est. savings

American Opportunity Tax Credit

Education

~$2,200
est. savings

Lifetime Learning Credit

Education

~$1,500
est. savings

529 Plan Contributions

Education

~$1,216
est. savings

Educator Expense Deduction

Education

~$80
est. savings

Employer-Required Education

Education

~$3,648
est. savings

Education Savings Bond Interest

Education

~$608
est. savings

Employer Education Assistance

Education

~$1,404
est. savings

Coverdell Education Savings Account in Neighboring States

Pennsylvania

3.07% top rate (flat)

~$342
-193 vs Maryland

Delaware

6.6% top rate (progressive)

~$390
-145 vs Maryland

Virginia

5.75% top rate (progressive)

~$378
-157 vs Maryland

West Virginia

5.12% top rate (progressive)

~$370
-165 vs Maryland

District of Columbia

10.75% top rate (progressive)

~$447
-88 vs Maryland

Tax Calculators for Maryland Cities

BaltimoreColumbiaGermantownSilver SpringFrederickWaldorfEllicott CityGlen BurnieRockvilleBethesda

Calculate Your Full Tax Savings in Maryland

Use our free tax calculators to optimize your entire tax return for Maryland.

Income Tax CalculatorMaryland Income TaxFull Coverdell Education Savings Account Guide

Frequently Asked Questions

How much can I save with the Coverdell Education Savings Account in Maryland?

In Maryland, the coverdell education savings account can save you an estimated $535 per year on a $5,000 deduction. This includes $440 in federal tax savings and $95 in Maryland state tax savings at the 4.75% marginal rate. The national average savings is $300/year.

What is the Maryland state income tax rate?

Maryland has a progressive income tax system with a top rate of 5.75%. 8 brackets. County taxes add 2.25-3.20%. Both estate AND inheritance tax. Low standard deduction.

Who qualifies for the Coverdell Education Savings Account in Maryland?

Parents saving for K-12 or college education. The eligibility requirements are the same whether you live in Maryland or another state, as this is a federal tax deduction. However, your total savings will vary based on Maryland's 5.75% top state tax rate.

What tax forms do I need to claim the Coverdell Education Savings Account in Maryland?

To claim the coverdell education savings account, you need to file Form 5498-ESA with your federal return. Maryland residents should also check if the state allows this deduction on their state return for additional savings of up to 5.75%. Filing status affects your deduction limits and tax bracket.

Is the Coverdell Education Savings Account better in Maryland than in states without income tax?

Yes, Maryland residents benefit more because the state's 5.75% top income tax rate means the deduction reduces both your federal AND state tax liability. In states with no income tax (like Texas, Florida, or Nevada), this deduction only reduces federal taxes. Your combined rate of 26.8% means more savings per dollar deducted.

What is the standard deduction in Maryland for 2026?

Maryland's standard deduction is $2,550 for single filers and $5,150 for married filing jointly. Total tax includes state and county. County tax adds significantly. Both estate and inheritance taxes apply. Low standard deduction makes itemizing worthwhile. Retirement income subtraction available for 65+.

Related Calculators

Student Loan Interest Deduction in Maryland

Avg savings: $550/year

American Opportunity Tax Credit in Maryland

Avg savings: $2,200/year

Lifetime Learning Credit in Maryland

Avg savings: $1,500/year

529 Plan Contributions in Maryland

Avg savings: $1,000/year

Educator Expense Deduction in Maryland

Avg savings: $66/year

Employer-Required Education in Maryland

Avg savings: $3,000/year