Maryland Inheritance Tax on Domestic Partners

If you live in Maryland and are in a long-term committed relationship, you may be surprised to learn that any inheritance you receive from your partner is subject to a 10% Maryland inheritance tax – unless you marry or become registered domestic partners.

The Process of Becoming Registered Domestic Partners

In Maryland, two people may become registered domestic partners if: (1) both persons are over the age of 18 (2) neither is the domestic partner of any other person, (3) they are not married, and (4) they are in a committed relationship with each other.

If one registered domestic partner dies without a will, then the surviving partner is treated the same as a surviving spouse:

• Having priority to serve as the Personal Representative
• Being entitled to the spousal allowance (currently $10,000)
• And inheriting the same share of the decedent’s probate estate as a spouse would

The surviving domestic partner is exempt from Maryland inheritance tax, whether the decedent died with or without a will.

If You Decide to End Your Partnership

You can terminate a registered domestic partnership in the following ways:

• Through mutual consent
• By one party, so long as you provide a copy to the other domestic partner
• By abandonment of one party for a period of at least six months without contact
• By marriage of one or more of the parties
• Or by death of one or more of the parties

Unilateral termination and termination through mutual consent take effect six months after the date of filing, while termination for the other reasons listed above takes effect immediately.

If a declaration of domestic partnership is not on file with the Register of Wills, then a surviving domestic partner may still be exempt from inheritance tax on jointly held real property that is a principal residence.

If you are in a Maryland domestic partnership, contact the attorneys at Lewicky, O’Connor, Hunt & Meiser, LLC to discuss your options.