When an individual passes away in Maryland, their property, debts, and legal rights are collectively referred to as their estate. The law provides a structured framework for how this estate is managed and distributed, ensuring assets are accounted for, debts are paid, and remaining property is transferred to the rightful heirs or beneficiaries.
What Constitutes an Estate in Maryland
An estate in Maryland is comprised of all assets a person owns at the time of their death. For administrative purposes, these assets are separated into two categories: probate and non-probate. Probate assets are those titled solely in the decedent’s name, such as a bank account held by one person or real estate owned as a “tenant in common.” These are the assets that must pass through the court-supervised probate process to be transferred to the new owners.
Conversely, non-probate assets bypass the probate process and are transferred directly to a designated person. Common examples include property owned as “joint tenants with rights of survivorship,” life insurance policies, retirement accounts like 401(k)s and IRAs, and accounts designated as “payable-on-death” (POD) or “transfer-on-death” (TOD).
Maryland Estates With a Will
When a person dies with a legally valid will, they are said to have died “testate.” A will is a legal document that directs how a person’s probate assets should be distributed. For a will to be valid in Maryland, it must meet requirements under the Estates and Trusts Article, § 4-102.
The will must be in writing, signed by the person making it (the testator), and attested to and signed by two or more credible witnesses in the testator’s presence.1Maryland General Assembly. §4–102. Estates and Trusts The testator and witnesses must be at least 18 years old and legally competent. The will allows the testator to name beneficiaries to receive their property and nominate a person to serve as the Personal Representative.
Maryland Estates Without a Will (Intestacy)
When a Maryland resident dies without a valid will, they die “intestate.” State laws of intestate succession then determine how their probate assets are distributed. These laws, found in the Maryland Code, Estates and Trusts Article, Title 3, establish a hierarchy of heirs based on which relatives survive the decedent.
For example, if the decedent is survived by a spouse and minor children, the spouse inherits one-half of the property, and the children inherit the other half. If the decedent has a surviving spouse and children from a previous relationship, the spouse receives the first $100,000 plus one-half of the remaining estate, with the children inheriting the rest.
If there is no surviving spouse but there are children, the children inherit the entire estate. The hierarchy continues to parents, siblings, and more distant relatives if no closer family members are living.
The Probate Process in Maryland
Probate is the court-supervised process of administering an estate, handled by the Register of Wills in the county where the decedent lived. The process begins by filing the will, if one exists, and a Petition for Administration. Maryland law provides two types of probate administration based on asset value: Small Estates and Regular Estates.
A Small Estate is a simplified process for probate assets valued at $50,000 or less, or $100,000 if the surviving spouse is the sole heir.2Register of Wills. Small Estates This process has fewer filing requirements and can be closed more quickly. A Regular Estate is required for estates with assets exceeding these values and involves a more formal process, including the appointment of a Personal Representative and more detailed court oversight.
Role and Responsibilities of the Personal Representative
The Personal Representative is the individual or institution appointed to manage the estate. Also known as an executor or administrator, this person is a fiduciary with a legal duty to act in the best interests of the estate. If nominated in a will, the court appoints that person, but if there is no will, the law provides an order of priority for appointment, starting with the surviving spouse or children.
The Personal Representative’s responsibilities include locating and taking possession of all probate assets, preparing and filing an inventory with the Register of Wills, and protecting the property during probate.3Justia. Maryland Estates and Trusts Code Section 7-101 (2024) – Duties of Personal Representative Generally They must also notify creditors, pay all valid debts, funeral expenses, and taxes. After all duties are complete, they distribute the remaining assets to the beneficiaries or heirs.
Maryland Inheritance and Estate Taxes
Maryland is one of the few states that has both an inheritance tax and an estate tax, though they apply in different circumstances. The Maryland inheritance tax is paid by the person who receives the property, not by the estate itself. As specified in the Tax-General Article, Title 7, direct heirs, such as a spouse, children, grandchildren, parents, and siblings, are completely exempt from this tax. However, more distant relatives, like nieces and nephews, and unrelated individuals must pay an inheritance tax at a rate of 10% on the value of the property they receive.
Separate from the inheritance tax is the Maryland estate tax, which is imposed on the total value of the decedent’s estate if it exceeds a certain threshold. For 2025, the Maryland estate tax exemption is $5 million. If the net value of the estate is below this amount, no Maryland estate tax is due.
For estates that exceed the exemption, the tax is calculated on a progressive scale with a maximum rate of 16%. This is distinct from the federal estate tax, which has a much higher exemption amount.