(a) (1) For an individual other than an individual described in paragraph (2) of this subsection, the State income tax rate is:
(i) 2% of Maryland taxable income of $1 through $1,000;
(ii) 3% of Maryland taxable income of $1,001 through $2,000;
(iii) 4% of Maryland taxable income of $2,001 through $3,000;
(iv) 4.75% of Maryland taxable income of $3,001 through $100,000;
(v) 5% of Maryland taxable income of $100,001 through $125,000;
(vi) 5.25% of Maryland taxable income of $125,001 through $150,000;
(vii) 5.5% of Maryland taxable income of $150,001 through $250,000;
(viii) 5.75% of Maryland taxable income of $250,001 through $500,000;
(ix) 6.25% of Maryland taxable income of $500,001 through $1,000,000; and
(x) 6.50% of Maryland taxable income in excess of $1,000,000.
(2) For spouses filing a joint return or for a surviving spouse or head of household as defined in § 2 of the Internal Revenue Code, the State income tax rate is:
(i) 2% of Maryland taxable income of $1 through $1,000;
(ii) 3% of Maryland taxable income of $1,001 through $2,000;
(iii) 4% of Maryland taxable income of $2,001 through $3,000;
(iv) 4.75% of Maryland taxable income of $3,001 through $150,000;
(v) 5% of Maryland taxable income of $150,001 through $175,000;
(vi) 5.25% of Maryland taxable income of $175,001 through $225,000;
(vii) 5.5% of Maryland taxable income of $225,001 through $300,000;
(viii) 5.75% of Maryland taxable income of $300,001 through $600,000;
(ix) 6.25% of Maryland taxable income of $600,001 through $1,200,000; and
(x) 6.50% of Maryland taxable income in excess of $1,200,000.
(3) (i) Except as provided in subparagraph (ii) of this paragraph, if the Maryland adjusted gross income of an individual described in paragraph (1) or (2) of this subsection includes any amount of net capital gain, as defined and determined under the Internal Revenue Code, the State income tax for the individual is the sum of:
1. the rates specified in paragraph (1) or (2) of this subsection applied to Maryland taxable income; and
2. an additional 2% of the amount of net capital gain included in the individual’s Maryland adjusted gross income.
(ii) To the extent included in calculating net capital gain for federal income tax purposes, any amount of capital gain from the sale or exchange of the following assets is not subject to the additional 2% tax rate specified in subparagraph (i)2 of this paragraph:
1. any residential dwelling sold for less than $1,500,000 that is the individual’s primary residence, including the land on which the dwelling is located and any accessory dwelling unit associated with the residence, if the dwelling is a single–family home, a town house, a row home, a residential condominium unit, or a residential cooperative unit;
2. assets held in:
A. a cash or deferred arrangement plan under § 401(k) of the Internal Revenue Code;
B. a tax–sheltered annuity or custodial account under § 403(b) of the Internal Revenue Code;
C. a deferred compensation plan under § 457(b) of the Internal Revenue Code;
D. an individual retirement account or individual retirement annuity under § 408 of the Internal Revenue Code;
E. a Roth individual retirement account under § 408A of the Internal Revenue Code; or
F. a defined contribution plan, a defined benefit plan, or a similar retirement savings plan;
3. cattle, horses, or breeding livestock held for more than 12 months if, for the taxable year of the sale or exchange, more than 50% of the individual’s gross income for the taxable year, including income from the sale or exchange of capital assets, is from farming or ranching;
4. land that is subject to a conservation, agricultural, or forest preservation easement or that will be subject to a conservation, agricultural, or forest preservation easement on the sale or exchange of the land;
5. property used in a trade or business, the cost of which is deductible under § 179 of the Internal Revenue Code; or
6. affordable housing owned by a nonprofit organization.
(4) The provisions of paragraph (3) of this subsection shall apply for individuals described in paragraph (1) or (2) of this subsection with a federal adjusted gross income in excess of $350,000.
(b) The State income tax rate for a corporation is 8.25% of Maryland taxable income.
(c) For a married couple filing a joint income tax return, the rates specified in subsection (a) of this section apply to the joint Maryland taxable income of the married couple.
(d) For a nonresident:
(1) the rates specified in subsection (a) of this section apply to the nonresident’s Maryland taxable income, calculated without regard to the subtractions under § 10–210(b), (e), and (f) of this title; and
(2) the State income tax imposed equals the result obtained under item (1) of this subsection multiplied times a fraction:
(i) the numerator of which is the nonresident’s Maryland taxable income, calculated with the subtractions under § 10–210(b), (e), and (f) of this title; and
(ii) the denominator of which is the nonresident’s Maryland taxable income, calculated without regard to the subtractions under § 10–210(b), (e), and (f) of this title.