Maryland Return of Income Tax Withholding
for Nonresident Sale of Real Property
1. Description and address of property transferred (include property account
7. Transferor/Seller is:
An S Corporation
A Business Trust
A Limited Liability Company
8. Computation of Total Payment and Tax to be Withheld (See Instructions)
3. Check box if the transferor/
2. Date of transfer
a. Total sales price
seller is reporting gain under
the installment method
b. Less selling expenses
c. Net sales price
4. Transferor/Seller’s identification no.
5. Spouse’s SSN
d. Less debts secured by mortgages or
(SSN or FEIN) (Enter only one number)
other liens on the property
e. Total payment
6. Transferor/Seller’s name (Enter only one name, unless husband and wife filing
f. Transferor/Seller’s ownership percentage
a joint return. If more than one transferor/seller, use separate forms for each)
g. Transferor/Seller’s share of total payment ____________
h. Enter h(1) or h(2) whichever applies
(1) If a business entity - 8.25%
(2) If an individual/estate/trust - 7%
i. Maryland Income Tax withheld (Multiply
Line g by Line h) (If certificate of partial
exemption granted, enter amount from
City, state and ZIP code
Line 3 of the Form MW506E)
Under penalties of perjury, I declare that I have examined this return and to the best of my knowledge
Preparer’s Name __________________________________________
and belief, it is true, correct and complete. If prepared by a person other than the transferor/seller, the
declaration is based on all information to which the preparer has any knowledge.
Preparer’s Phone Number ___________________________________
Copy A - For Comptroller of Maryland, Revenue Administration Division. (File with Clerk of the Circuit Court)
INSTRUCTIONS FOR RETURN OF INCOME TAX WITHHOLDING FOR NONRESIDENT SALE OF REAL PROPERTY
THERE ARE FOUR COPIES OF FORM
What to file
Do not enter the street address of the property being
Copies A and B of each Form MW506NRS must be
filed with the deed or other instrument of transfer
when presented to the Clerk of the Circuit Court
Purpose of Form
for recordation. A separate check or money order
If a Certificate of Partial Exemption is
Form MW506NRS is designed to assure the regular
in the aggregate amount of the tax due for each
issued by the Comptroller, do not complete lines 8a
and timely collection of Maryland income tax due
nonresident transferor/seller with regard to a sale or
though 8h. Instead, enter the amount from Line 3 of
from nonresident sellers of real property located
transfer of real property must be paid to the Clerk.
the Form MW506E on Line 8i.
within the State. This form is used to determine the
Give Copy C to the transferor/seller at closing. The
amount of income tax withholding due on the sale of
issuer retains Copy D.
property and provide for its collection at the time of
payment allocable to the transferor/seller that is
the sale or transfer.
subject to the income tax withholding requirements
and the amount of tax required to be withheld. The
Who must file Form MW506NRS
Enter the street address for the property
total payment is computed by deducting from the
as listed with the State Department of Assessments
If the transferor/seller is a nonresident individual or
total sales price (including the fair market value of
and Taxation (SDAT). If the property does not have a
nonresident entity, and is transferring an interest in
any property or other nonmonetary consideration
street address, provide such descriptive information
real property located within the State of Maryland,
paid to or otherwise transferred to the transferor/
as is used by SDAT to identify the property. Also
unless the transaction is otherwise exempt from
seller) the amount of any mortgages or other liens,
include the SDAT property account ID number for
the income tax withholding requirement, the person
the commission payable on account of the sale, and
the parcel being transferred. If the property is made
responsible for closing must file Form MW506NRS
any other expenses due from the seller in connection
up of more than one parcel and has more than
with the deed or other instrument of transfer that
with the sale.
one account number, include all applicable account
will be filed with the Clerk of the Circuit Court for
If there are multiple owners, enter the
percentage of ownership of the transferor/
sellers, a separate form must be completed for each
Enter the date of transfer. The date of
seller for whom this form is being filed.
nonresident individual or nonresident entity subject
transfer is the effective date of the deed as defined in
to the withholding requirements. The separate form
§3-201 of the Real Property Article, Annotated Code
Line g. Multiply line e by line f to determine
requirement does not apply to a husband and wife
of Maryland. The effective date is the later of: (1) the
the transferor/seller’s share of the total
filing a joint Maryland income tax return.
date of the last acknowledgement; or (2) the date
stated in the deed.
A “nonresident entity” is defined to mean an entity
Line h. Enter the applicable rate for the transferor/
that: (1) is not formed under the laws of Maryland
Check the box if the transferor/seller is
more than 90 days before the date of sale of the
reporting the gain under the installment method.
Payment of Tax
property, and (2) is not qualified by or registered
Lines 4, 5 and 6.
Unless transferors/sellers are
Make check or money order payable to the Clerk of
with the Department of Assessments and Taxation
husband and wife and filing a joint Maryland income
the Circuit Court for the county or Baltimore City in
to do business in Maryland more than 90 days before
tax return, a separate Form MW506NRS must be
which the deed or other instrument of transfer will be
the date of sale of the property.
completed for each transferor/seller that is entitled
presented for recordation.
When to file Form MW506NRS
to receive any part of the proceeds of the transfer.
Enter the tax identification number or social security
Unless the transaction is otherwise exempt from
Copy A of this return must be verified and signed
number for the nonresident transferor/seller and the
the income tax withholding requirement, the person
by the individual transferor/seller, an authorized
social security number for the spouse, if applicable.
responsible for closing must include with the deed or
person or officer of a business entity or the person
(Do NOT enter the tax identification number on Copy
other instrument of transfer, a Form MW506NRS for
responsible for closing.
B of Form MW506NRS.) Enter the name (or names,
each nonresident transferor/seller, when the deed or
if husband and wife filing a joint return) of the
other instrument of transfer is presented to the Clerk
transferor/seller and the transferor/seller’s address.
of the Circuit Court for recordation.