Maryland taxes most military pay a resident service member earns, but you can subtract $15,000 of pay you earn while on active duty outside the boundaries or possessions of the United States. You have to have earned less than $30,000 in military pay for the year to use it.
There is nothing to file separately. Claim the subtraction on your Maryland income tax return, following the instructions in Maryland Personal Tax Tip #55.
Your Leave and Earnings Statements or orders showing the dates you served outside the United States, and your W-2 showing total military pay.
