CHARITABLE, FRATERNAL, EDUCATIONAL
Commonly Asked Questions Which May Apply to Your Taxable
AND ALL OTHERS
Why does a religious, charitable, fraternal, educational or other
similar type organization have to apply for a real property tax
exemption if the group is already recognized as tax exempt for
income tax purposes by the Federal Internal Revenue Service or
the Maryland Comptroller's Office?
A. The Maryland real property tax laws have special requirements
for granting these types of exemptions that are different from
those for an income tax exemption. The Maryland General Assembly
has limited these exemptions because all other property owners
are indirectly subsidizing any exemptions granted by reducing
the base of persons obligated to pay taxes. No organization is
automatically exempt without first having to apply and demonstrate
that the actual use of the property is within the limited purposes
prescribed in the particular exemption statute. The fact that
a property is being used for non-profit purposes will not merit
an exemption unless the use is one specifically exempted by law.
Q. How do organizations know that they should apply?
A. Often, the first notice will result from a tax bill
being issued to the group on July 1 of the year. An organization
should never ignore a tax bill and incorrectly assume a property
is automatically exempt.
Q. When and how does an organization apply for a real
property tax exemption?
A. With the exception of blind persons, disabled veterans,
and charitable organizations just purchasing the property in the
current tax year, all other applicants for a real property tax
exemption must apply by September 1 of the year. If no application
is received by the September 1 date, then an exemption will not
be granted until the following year.
An application form can be obtained from the local Department
of Assessments and Taxation office, and it should be returned
before September 1 of that year. Once granted, the exempt status
continues unless revoked. An exempt organization need not reapply
Q. What is the earliest date an exemption can start?
A. The general rule is that an organization must own and
use the property for the exempt purpose by July 1 and apply by
September 1 of the tax year in order for the exemption to be effective
for that tax year. Charitable organizations which purchase a property
with a full market value of less than $300,000 and which begin
actually using the property for exempt purposes, will be eligible
for the exemption as of the date the legal ownership is recorded
in the name of the exempt organization. In cases where a new structure
is being built or an existing building is being renovated, the
exemption cannot start until actual construction or renovation
Q. What are the general guidelines for granting the
various types of exemptions?
A. Religious: Religious groups may receive an exemption
for properties used exclusively for public religious worship,
a parsonage or convent or educational purposes. The law does not
extend this type of exemption to properties owned by religious
groups that are used as a caretaker's residence, a residence for
a minister of music, or a residence for an administrator or other
Charitable: These groups must demonstrate that the
use of the property serves the traditional objects of charity
and not just merely providing a service to a particular segment
of the community. Moreover, non-profit use is not the equivalent
Fraternal, Sororal: These organizations are generally
limited to receiving an exemption on property used as a meeting
Educational: These groups must show that the property's
use adds to the systematic dissemination of education or knowledge
to the general public of Maryland. Hobby support organizations
do not meet the tests for receiving this type of exemption.
Blind Persons: Those persons with a central visual
acuity of 20/200 or less in the better eye may receive, with a
doctor's certification, an exemption of $15,000 of assessment
reduction on the dwelling house and surrounding yard. Legally
blind persons may apply at any time and need not meet the general
September 1 filing deadline.
Disabled Veterans and Surviving Spouses: Armed Services
veterans with a permanent service connected disability rated 100%
by the Veterans Administration may receive a complete exemption
from real property taxes on the dwelling house and surrounding
yard. These veterans also may apply at any time and do not have
to meet the September 1 filing deadline. Unremarried surviving
spouses also may apply for this exemption. Surviving spouses of
military personnel killed in the line of duty may apply for an
Other Exemptions: There are other special tax exemptions
granted to government owned properties, cemeteries, community
water systems, fire companies and rescue squads, historical societies,
housing authorities, environmental conservation groups, and certain
specifically named organizations.
View a list of local Assessment offices