Manufacturing and Research and Development, Tax Property Article § 7-225, basis for the exemption is
the operation.
For manufacturing exemption requests, an application must be submitted on or before September 1 of the
assessment year in order to qualify for the current tax year. Please see https://dat.maryland.gov for the
Manufacturing and R&D Exemption Application. Section 7-104 of the Tax-Property Article of the Annotated Code of
Maryland has been revised to include subsection (d) that allows the owner of manufacturing personal property to
file an application within 6 months after the date of the first assessment notice for a taxable year that includes the
manufacturing personal property. If the application is approved, the exemption shall be granted for the taxable year.
This exception to the September 1 deadline is applicable to taxable years beginning after June 30, 2009. No
manufacturing exemption can be granted unless a timely application is filed.
Once the exemption is granted to an entity, no additional manufacturing applications are required in subsequent
years. Manufacturing assets acquired after the exemption is granted will need to be described as well as the role
the assets play in the manufacturing process. If this information is not provided, the assets will likely be subject to
assessment.
It will be necessary to provide the letter from the Department granting your entity the Manufacturing/R&D
Exemption, to any companies that lease manufacturing equipment to your entity so that the leased equipment can
qualify for the exemption. The law specifically includes the following activities as part of the manufacturing process:
(1) the identification, design or genetic engineering of biological materials for research or manufacture; and (2) the
design, development or creation of computer software for sale, lease orlicense.
Other personal property assessment exemptions: All personal property owned by certain organizations,
including religious groups, government, non-profit hospitals, cemetery and mausoleum companies, and
certain other organizations, or groups which meet certain “strict use” criteria is exempt. These are referred to as
exempt organizations and are fully exempt throughout Maryland from any assessment and taxation. In section V,
F or in Remarks, please give a brief explanation or reason for the exemption.
Charitable or Educational Purposes, Tax-Property Article § 7-202, exemption from assessment is
based on the property owned by the charitable or educational institution.
Non-stock educational or charitable exemptions are also obtained by filing an application. An organization must
submit written information detailing its operation in the form of the Department’s Charitable Application.
If the organization is required to file an IRS Form 990, it should be included with the application. Also, submit a
copy of the 501(c)(3) certification from the IRS. Please note that because the laws differ, organizations granted
exempt status by the Internal Revenue Service are not necessarily exempt from personal property taxation in
Maryland. The exemption applies to the assessment.
Entities that are granted an exemption under Tax Property Article 7-202, are still required to file the Form 1.
Exemption applications may be emailed to sdat.ppaudit@maryland.gov
In addition, State law requires that certain types of personal property be fully exempt from assessment and taxation
throughout Maryland. These include aircraft, farming implements, residential (non-business) property, most
registered vehicles, boats not more than 100 feet in length, customized computer software, intangible personal
property (e.g., stocks, bonds, patents, goodwill, trademarks, etc.).
Full or partial exemptions may apply depending on the location of the property for: manufacturing/R&D machinery
and equipment, manufacturing/R&D inventory and commercial inventory. Visit the Department’s website for a
complete listing of these exemptions.
Tax Property Article § 7-245
A person’s (any business entity’s) personal property is not subject to valuation or to property tax if ALL of the
person’s personal property statewide has a total original cost less than $20000. This exemption shall take effect
July 1, 2022, and shall be applicable to all taxable years beginning after December 31, 2021.
NOTES:
Mail the completed return to:
Maryland Department of Assessments and Taxation Business Personal Property
PO Box 17052
Baltimore, Maryland 21297-1052
All other correspondence, including Amended Returns, should be sent to:
Maryland Dept. of Assessments and Taxation Business Personal Property
301 W. Preston Street Baltimore, Maryland 21201-2395