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February 2, 2025
Question

Do we have to file a state return for the sale of a house if we got a full exemption from the state of Md. on form MW506E ?

  • February 2, 2025
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    February 2, 2025

    The MW506E is an exemption from withholding tax, which means you were not required to submit money at the time of the sale, but it does not exempt you from filing the income tax return (even if no tax is expected).  Maryland requires nonresidents to file if they had federal gross income over a certain amount and income from state sources, so you would report the sale and show the basis so they can see there was no taxable income.