Maryland Tax Payment Plan

Maryland tax payment plan basics

If you owe past-due state taxes in Maryland, you can set up a payment plan with the comptroller’s office. Much like an IRS installment agreement, Maryland’s individual payment agreement allows you to pay off your tax liabilities over time instead of all at once.

Who qualifies for a payment plan?

Maryland payment plans are generally available to individual taxpayers who owe personal income tax and need additional time to pay.

“But whether you qualify comes down to compliance and your financial picture,” said Stephen A. Weisberg, principal attorney and founder of The W Tax Group, a nationwide tax defense company. “The state wants all returns filed, along with a clear picture of your income, expenses and assets. If you don't present your financials clearly and utilize the rules at your disposal, you can end up with a payment plan that you can't actually afford.”

Taxes and debts the plan covers

Maryland's installment plan program covers personal income tax liability, including any accrued interest and penalties. It doesn’t cover all state debts, though, so if you have a mix of tax types, check with the comptroller’s Collections Section to verify which balances are eligible.

Costs, interest and penalties

Setting up a payment plan doesn't stop interest and penalties from accumulating. Maryland charges interest on unpaid balances throughout the repayment period, so the longer the duration of your plan, the more you'll pay overall. Penalties also continue to accrue unless specifically waived.

If reducing your penalty burden is your main priority, consider looking into tax resolution options before committing to a standard payment plan.

When to choose a payment plan

“A payment plan makes the most sense when you have consistent income and can pay the balance over time without putting yourself in economic hardship,” Weisberg said. “If paying the debt would create hardship or the state will never be able to collect the balance from you based on your income or equity in assets, that's when payment plans should not be considered.”

If you genuinely cannot afford to pay your tax debt even on an installment basis, you may want to explore hardship-based options. And if your tax debt stretches back several years, look into how to file back taxes before setting up a payment plan, since unfiled years can complicate or disqualify your arrangement.

Maryland tax payment plan options

Maryland offers a few different tax payment plan options. The right one for you may depend on your situation and how you prefer to manage your account.

Maryland payment plan setup steps

If you owe state taxes in Maryland and you can’t pay them in one lump sum, follow these steps to set up a payment plan.

Gather your notice number

You need the notice number from a recent tax bill to set up a new payment agreement. Without it, you won't be able to complete the online application. If you don’t know your notice number, call the Collections Section at 410-974-2432 or 888-674-0016.

Log in to the Online Service Center

Visit the Comptroller of Maryland's website and navigate to the Individual Taxpayer Online Service Center. You'll need to either create a new account or log in to an existing one. Have your Social Security number and tax information handy.

Request a new payment agreement

Once you log in, follow these steps:

1. Select the option to manage or view your tax account.
2. Look for an option to request a payment plan.
3. Enter your notice number when prompted.
4. Check the outstanding balance.
5. Choose your monthly payment amount and start date.
6. Review the agreement terms.
7. Submit and save your confirmation number.

Set up automatic payments

After your agreement is active, follow these steps:

1. Head back to the Online Service Center.
2. Choose the automatic payment enrollment option.
3. Enter your bank account information.
4. Confirm the monthly deduction date and amount.

View agreement history and status

You can check your payment history, remaining balance and agreement status through the Online Service Center. Be sure to record each payment in case of a dispute.

Maryland payment plan problems and fixes

Here's how to handle common issues you may face when trying to resolve your Maryland tax debt.

Issue: Notice number missing or unknown

Your notice number should appear on any tax bill or balance due letter from the comptroller. If you can't find it, search recent mail first. If the notice is lost or it never arrived, call the Collections Section. This department can verify your identity and either provide the number or help you set up a plan over the phone without it.

Issue: Unable to set up online

Start by resetting your password, clearing your browser cache or switching to Chrome or Firefox if you’re using a different browser. If the system doesn't recognize your account, you may need to register rather than log in. If the portal still won't cooperate, call the Collections Section to complete the setup by phone.

Issue: Missed payments and default

If you miss or default on your payments, the comptroller has the authority to terminate the agreement and resume collection actions. If you’re having trouble keeping up with payments, make the Collections Section aware of your situation as soon as possible. It may be willing to amend the plan before cancellation.

Issue: Payment rejected or plan denied

A rejected payment can indicate a bank account or routing error, so update your information immediately. If your online application is denied outright, call the Collections Section and see if you can make phone-based arrangements.

Issue: Driver’s license or MVA holds

Maryland can place a hold on your driver's license renewal or vehicle registration for unpaid taxes. To make payment arrangements and release an MVA hold, call the Comptroller of Maryland at (855) 213-6669 or email mvahold@marylandtaxes.gov. Be sure your email message includes your name, address, phone number, case number or notice number and the last four digits of your Social Security number.

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