Maryland Homestead Tax Credit Application: What New PG County Owners Must File (Part 5 of 30: The Prince George's County Answer Guide)
This is Part 5 of The Prince George's County Answer Guide from Donnell Williams Jr. and DMV Prime Properties, a 30-part series answering the questions buyers, sellers, and people relocating are actually searching about Prince George's County, Maryland. This post covers the Maryland homestead tax credit application every new Prince George's County homeowner should file.
The Maryland homestead tax credit application is a one-time form filed with the Maryland Department of Assessments and Taxation (SDAT). Once approved, it limits how much the taxable assessment on your principal residence can rise each year. In Prince George's County, the county cap is 3%, while the state cap is 10%.
Key Takeaways
- The Homestead Tax Credit limits yearly increases in the taxable assessment of your principal residence, according to SDAT.
- You file the application once, with SDAT, not with Prince George's County.
- Prince George's County's homestead cap is 3% for fiscal years 2025 through 2027, according to a 2026 Department of Legislative Services fiscal note.
- The state cap is 10%, and some PG County municipalities set their own caps for municipal taxes.
- You must live in the home at least six months a year, including July 1, and you can receive the credit on only one property.
- The Homeowners' Property Tax Credit is a separate, income-based program with its own application and deadlines.
What is the Maryland homestead tax credit?
The homestead tax credit, often called the assessment cap, protects owner-occupants from sharp jumps in property taxes when home values rise. It does not lower your home's assessed value. Instead, it limits how much of an assessment increase can be taxed in a given year.
SDAT reassesses Maryland property on a three-year cycle and phases in increases over that period. Without the cap, a large jump in value could raise your tax bill quickly. With the cap, the taxable assessment for county purposes in Prince George's County can rise by no more than 3% per year on an approved homestead.
According to SDAT, the credit "applies only to the portion of an assessment increase above the cap." If your assessment does not rise faster than the cap, you will not see a credit on your bill that year. That does not mean you lost your approval.
Who qualifies for the homestead tax credit?
SDAT lists these eligibility rules:
- Ownership and use: You must own the property and use it as your principal residence.
- Occupancy: You must live there at least six months of the year, including July 1, unless you are temporarily absent due to illness or the need for special care.
- One property: You can receive the credit on only one home.
- Recent changes: The credit is not granted for a year if, in the previous tax year, the property was transferred to a new owner, had a homeowner-requested zoning change that increased its value, had a substantial change in use, or had a clearly erroneous prior assessment.
That transfer rule matters for buyers. When you buy a home, the seller's homestead protection does not carry over to you. The cap generally starts working for you only after the transfer year has passed and your application is approved. For context, according to Bright MLS data for Prince George's County for September 2026, the median annual property tax listed on detached homes sold that month was $6,275, and that figure reflects the seller's bill, not necessarily yours. New owners should budget for a possible tax increase in the first year or two (see Part 6 of this series on the Prince George's County property tax rate).
How do you file the Maryland homestead tax credit application?
There are three ways to file, according to SDAT:
- Online through SDAT's homestead site: SDAT lists sdathtc.dat.maryland.gov as its fastest option.
- Online through Maryland OneStop: At onestop.md.gov, choose "Browse by State Agencies," then "Department of Assessments & Taxation," then "Homestead Tax Credit Eligibility Application."
- By mail or fax: Mail the paper form to the Homestead Tax Credit Division, 700 East Pratt Street, 2nd Floor, Suite 2700, Baltimore, MD 21202, or fax it to 410-225-9344.
SDAT asks homeowners not to email applications, since they contain personal information. The paper form is available in English and Spanish.
When should you file?
File soon after you move in. SDAT says it mails a homestead application to new owners after the deed is recorded and its records are updated, but you do not need to wait for that letter. Maryland law also requires that residential sales contracts include a homestead notice with the website dat.maryland.gov/homestead, and that the settlement agent give the buyer a copy of the application at settlement.
SDAT's homestead page does not list a filing deadline. Since you must occupy the home by July 1 of the tax year, buyers who settle in the spring should file as soon as they move in.
What do you need to file?
Have your property address, account number (from SDAT's Real Property search), settlement date, and the details the form requests for each owner. If you used a program like Pathway to Purchase, your file already shows the home is your primary residence, but you still must file the homestead application separately (see Part 1 of this series on the Prince George's County first time home buyer program).
How does the 3% Prince George's County cap work?
Every Maryland county and municipality sets a homestead cap of 10% or less, according to SDAT. A 2026 Department of Legislative Services fiscal note (for HB 603) lists Prince George's County's cap at 3% for fiscal years 2025, 2026, and 2027. The state's cap for state property tax purposes is 10%.
Here is an illustration. The numbers below are made up to show the math, not taken from a real property.
The credit equals the credited amount multiplied by the tax rate for each level of government. For example, SDAT's own example uses a rate of $1.04 per $100 of assessed value on a $10,000 credited amount, which produces a $104 credit. To estimate your own credit, apply the current county and state rates (see Part 6 of this series on the Prince George's County property tax rate).
Do PG County municipalities have their own caps?
Yes. Many incorporated towns and cities in Prince George's County charge a municipal property tax and set their own homestead percentage. According to SDAT's homestead percentage list effective July 1, 2024:
A municipal cap applies only to the municipal portion of your tax bill. Homes in unincorporated areas, such as Fort Washington, Clinton, Accokeek, or Brandywine, pay county and state taxes but no municipal tax. SDAT publishes current local rates and caps on its Tax Rates page.
How do you check whether your homestead credit is approved?
Search your address on SDAT's Real Property search. The application status appears near the bottom of the property record. According to SDAT:
- "Approved" or "Application Received" means no further action is needed.
- "No Application" means you should file.
Donnell Williams Jr. has worked in Prince George's County real estate since 2000, beginning at Asset Realty in the county. A common pattern: owners assume the homestead was filed and later find "No Application" on their record. A two-minute search answers the question.
If SDAT denies your application, you can appeal to the Property Tax Assessment Appeal Board within 30 days of the final denial, according to SDAT.
What is the difference between the homestead credit and the homeowners' tax credit?
These two programs have similar names but work differently.
The income limits and deadlines above come from Prince George's County's Homeowners' Property Tax Credit page. SDAT administers both programs. Owners who qualify can receive both.
Common homestead mistakes new owners make
- Assuming the seller's credit transfers. It does not.
- Filing for a rental or second home. The credit applies only to your principal residence.
- Confusing the two credits. The homestead filing does not apply you for the income-based credit.
Donnell is a PMP, so he gives every buyer a short post-closing checklist with the homestead filing on it, along with saving the settlement statement and recorded deed.
Frequently Asked Questions
Where do I submit the Maryland homestead tax credit application?
You submit it to the Maryland Department of Assessments and Taxation, not the county. SDAT accepts it online through its homestead site or Maryland OneStop, or by mail or fax.
Do I have to file the homestead application every year?
No. According to SDAT, the application is filed once during your ownership of the property. Check SDAT's Real Property search to confirm your status.
What is the homestead cap in Prince George's County?
A 2026 Department of Legislative Services fiscal note lists the Prince George's County cap at 3% for fiscal years 2025 through 2027. The state cap is 10%, and municipalities can set their own.
Will my property taxes go up after I buy?
They can. SDAT does not grant the homestead credit for a year if the property transferred to a new owner in the previous tax year, so the seller's cap does not carry over to you.
Who do I contact with homestead questions?
SDAT lists sdat.homestead@maryland.gov, 410-767-2165 for the Baltimore area, and 1-866-650-8783 toll free.
This article is general information, not legal, tax, or lending advice. For your specific tax situation, consult a CPA or contact SDAT.
Next Steps
Filing the Maryland homestead tax credit application is one of the easiest ways to protect your budget after closing. Donnell Williams Jr., Broker-Owner of DMV Prime Properties and author of The Complete Guide to Buying a Home, builds the homestead filing and tax planning into every buyer consult, so new owners know their estimated taxes before they write an offer and what to file after they get the keys. That is "Educate to Elevate" in practice. Call 301.265.3446, email donnell@dmvprimerealty.com, or visit OWNDMV.COM. DMV Prime Properties is at 12815 Old Fort Road, Suite 105, Fort Washington, MD 20744.
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