MD-WV reciprocity serves the Eastern Panhandle - Martinsburg/Charles Town WV residents commuting to Hagerstown/Frederick MD and the MARC rail corridor toward the DC metro.
| Scenario | Form To File | Result |
|---|---|---|
| Live MD, work WV | WV/IT-104R (to skip WV) | No WV withholding. Pay MD tax only. |
| Live WV, work MD | MW507 (to skip MD) | No MD withholding. Pay WV tax only. |
OBBBA 2026 (One Big Beautiful Bill Act) raised the federal SALT cap to $40,000. This matters for reciprocity commuters who itemize: your full home-state income tax is now more likely to be fully deductible on federal Schedule A, making the state-level tax difference between your home and work state a real after-tax driver of commute value. Check each state rate: MD top rate 5.75% state + 2.25-3.2% county, WV top rate 4.82% top (2025).
File MD form MW507 (Employee’s Maryland Withholding Exemption Certificate) with your Maryland employer, completing the line certifying you are a WV resident exempt under reciprocity. Both MD state and MD county withholding stop.
File WV form WV/IT-104R (Certificate of Nonresidence) with your West Virginia employer. WV withholding stops; Maryland state plus your county piggyback tax are withheld instead.
Yes. Maryland’s county income tax (2.25%-3.2%) piggybacks on the state tax, so a WV resident exempt under reciprocity owes neither. Total MD withholding should be $0.
Not this agreement - working in DC is governed by DC’s rules, and DC exempts all nonresidents (file D-4A with a DC employer). This MD-WV agreement covers WV residents whose work state is Maryland, e.g., Hagerstown or Frederick employers.
File a Maryland nonresident return (Form 505) reporting the wages as exempt under reciprocity to recover the withholding, then file the corrected MW507 with payroll. WV residents owe WV tax on the wages either way - budget for the catch-up payment.
See exact post-reciprocity paycheck with MD or WV withholding.
Paycheck Calculator →Run the numbers for each state: Maryland Income Tax Calculator · West Virginia Income Tax Calculator
Tax calculations are estimates for educational and informational purposes only. This site does not provide tax, legal, or financial advice. Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. Data sourced from IRS publications and official state tax authority websites.
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