Iowa vs Maryland Taxes
Compare the total tax burden between Iowa (3.8% flat) and Maryland (2% – 5.75%). Enter your income to see which state saves you more.
Tax at Different Income Levels
| Income | Iowa Total Tax | Maryland Total Tax | Annual Savings |
|---|---|---|---|
| $75,000 | $15,938 | $16,448 | +$510 |
| $100,000 | $24,301 | $25,048 | +$748 |
| $150,000 | $41,644 | $42,975 | +$1,332 |
| $200,000 | $57,887 | $60,029 | +$2,142 |
Based on single filer, standard deduction, 2025 tax year. Includes federal income tax, state income tax, and FICA.
Why the difference
You'd pay $748/year ($62/month) more in Maryland vs Iowa.
Tax structure
Iowa has a flat 3.8% state income tax, while Maryland uses progressive brackets up to 5.8%.
Effective rate at your income
At $100,000, Iowa's effective state rate is 3.2% vs 3.9% in Maryland — a 0.7 percentage point gap.
Tip: In a progressive-bracket state, pre-tax 401(k) and HSA contributions reduce your state tax bill along with federal tax. If you are near a bracket boundary, an additional contribution can drop you into a lower state bracket.
Tip: In a progressive-bracket state, pre-tax 401(k) and HSA contributions reduce your state tax bill along with federal tax. If you are near a bracket boundary, an additional contribution can drop you into a lower state bracket.
Understanding Each State
Iowa
This state uses a progressive income tax system with multiple brackets, similar to the federal system. Only the income within each bracket is taxed at that rate, so your effective state rate is lower than the top bracket. Tax planning strategies include maximizing pre-tax retirement contributions to reduce state-taxable income.
Tip: In a progressive-bracket state, pre-tax 401(k) and HSA contributions reduce your state tax bill along with federal tax. If you are near a bracket boundary, an additional contribution can drop you into a lower state bracket.
Maryland
This state uses a progressive income tax system with multiple brackets, similar to the federal system. Only the income within each bracket is taxed at that rate, so your effective state rate is lower than the top bracket. Tax planning strategies include maximizing pre-tax retirement contributions to reduce state-taxable income.
Tip: In a progressive-bracket state, pre-tax 401(k) and HSA contributions reduce your state tax bill along with federal tax. If you are near a bracket boundary, an additional contribution can drop you into a lower state bracket.
Key Comparison Points
Income tax structure: Iowa has a flat income tax (3.8% flat), while Maryland has a progressive income tax (2% – 5.75%).
Beyond income tax: State tax comparisons should also consider property tax rates, sales tax, and cost of living. A state with no income tax may have higher property or sales taxes that offset the savings.
SALT deduction cap: Under OBBBA (2025+), the federal SALT cap is $40,000, phasing out above $500,000 MAGI toward a $10,000 floor. This limits the federal tax benefit of living in a high-tax state, so the gross state tax difference remains close to the net difference for most earners — especially high earners inside the phaseout.
Frequently asked questions
Is it cheaper to live in Iowa or Maryland?
Based on income tax alone, Iowa has a lower tax burden. At $100K income, you'd save $748 annually in Iowa compared to Maryland. However, total cost of living also depends on property taxes, sales taxes, and housing costs.
How much would I save moving from Maryland to Iowa?
A single filer earning $100,000 would save approximately $748 per year in total taxes by living in Iowa instead of Maryland. At $150,000 income, the savings change to $1,332 per year.
What is the income tax rate in Iowa?
Iowa has a flat income tax with rates of 3.8% flat.
What is the income tax rate in Maryland?
Maryland has a progressive income tax with rates of 2% – 5.75%.