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           MARYLAND                                  Application for Certificate of                                 DO NOT WRITE OR STAPLE 
              FORM                                                                                                           IN THIS SPACE
                                                          Full or Partial Exemption
MW506AE                                For the sale of real property or associated personal property 
                                                     in Maryland by nonresident individuals and entities.
           2021

TheMUST BE RECEIVED                                       laterno                                                                                                            than 21 days before closingandform date.documentsrequired 
 Social Security Number                                                   Spouse's Social Security Number

 Your First Name                                          MI              Last Name

 Spouse's First Name                                      MI              Last Name

 Name (Corporation, Partnership, Trust, Estate, etc.)

 T/A or C/O or Fiduciary                                                                                 Federal Employer Identification Number

 Present Address (No. and street)

 City or Town                                                             State                          ZIP code

 Transferor/Seller’s Entity Type:                                                                        Ownership Percentage
             Individual/ Estate/ Trust   Business                                                        ________________________%
                                                          Property Information
 Description of Property (Include street address, county, or district,    Was the property ever used as a rental or commercial property?
 subdistrict and lot numbers if no address is available.)                 (Note: Income tax returns are required in most circumstances - see instructions.)
                                                                                                          Yes     No
                                                                          Dates used as a rental/commercial property (mm/dd/yyyy):
                                                                          FROM _______________TO _________________
                                                                          Date of Closing (mm/dd/2021) 
                                                                          (REQUIRED)

                                                     Calculation of Tentative Exemption - Required
(The certificate of exemption will be calculated based on actual documents received & amounts substantiated.  The Comptroller’s decision to issue or 
deny a full or partial exemption and the amount is final and not subject to appeal.) See instructions for more details on required documentation.
      1. Purchase price/Inherited value. (Attach a copy of the settlement statement
           or Death Certificate and appraisal.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1. ____________
   2. Capital Improvements. (Optional. Will not be credited unless properly documented.
           Attach paid invoices or receipts with cancelled checks for improvements.) . . . . . . . . . . . . . . . . . . . . . . . . . . . 2. ____________
   3. Settlement expenses.
           a. Original purchase (Attach settlement statement)  . . . . . .
        b. Pending sale (Attach preliminary closing disclosure) . . . .                                  Add lines 3a. and 3b.  3. ____________
   4.      Add (Lines 1 through 3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. ____________
   5. Depreciation deducted for rental activity on federal return. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5. ____________
   6.      Subtract (Line 5 from Line 4). This is your adjusted basis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6. ____________
   7. Contractst                                                                                                                                                                          sales price. (Attach contract [1  page and signature pages] or preliminary
           settlement statement.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7. ____________
  8a.      Subtract (Line 6 from Line 7). This is the amount subject to tax.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8a. ____________
8b.        Multiply Line 8a by ownership percentage (1.00, .50, .333, etc.)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8b. ____________
   9. Tax Rate.  Check box for applicable tax rate.
        a.   Individual  8.0% (.080)
       b.    Business    8.25% (.0825)
  10. Tentative withholding amount.  Multiply line 8b by applicable tax rate.
           If Line 8 is zero (0) or less than zero (0), enter zero (0). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. ____________

NOTE: This amount will be recalculated by the Comptroller’s Office based on the actual documentation received and amounts 
           substantiated.
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MARYLAND Application for Certificate of Full or Partial Exemption 2021
FORM page 2
MW506AE

Transferor/Seller’s Name ______________________________________________________ Your Social Security Number/FEIN _____________________________

Special Situations
Check the box in the “Special Situations” column that applies to your situation, if any. If none apply, your exemption will be based
only on the amount on the worksheet on page 1. See instructions for required documentation.

Principal Residence. Transfer is pursuant to an installment sale under §453 of
the Internal Revenue Code.

Principal Residence – Active-duty Military, Certain Transfer of inherited property is occurring within 6 months
Government Employees. of date of death.

Tax-Free Exchange for purposes of §1031 of the Internal Transferor/seller is the custodian of an individual retirement
Revenue Code. account (IRA).

Transferor/seller is receiving zero proceeds from this Transfer is pursuant to a specific Internal Revenue Code
transaction because proceeds are going to another seller/ section. See addendum.
owner (ex. cosignor).

Address of Settlement Agent to Mail Certificate if Issued (See instructions.)

Name of contact person and company

Street Address City State ZIP code

Telephone number Fax number Email Address

Under the penalties of perjury, I declare that I have examined this application, including any schedules or statements attached, and to the best of my knowledge and belief, it is
true, correct and complete. If prepared by a person other than taxpayer, the declaration is based on all information of which the preparer has any knowledge.

Your signature Date Preparer’s PTIN (required by law) Signature of preparer other than taxpayer

Spouse’s signature Date Printed name of preparer

Telephone number Address of preparer

Telephone number of preparer

Check here if you authorize
us to contact you by email. Email address

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MARYLAND
FORM INSTRUCTIONS FOR APPLICATION FOR 2021
CERTIFICATE OF FULL OR PARTIAL EXEMPTION
MW506AE The Comptroller’s decision to issue or deny a certificate and the amount of
tax is final and not subject to appeal.
GENERAL INSTRUCTIONS it to your submission of the MW506AE.
Purpose of Form Calculation of Tentative Exemption/Withholding Amount
Use Form MW506AE to apply for a Certificate of Full or Partial Complete the calculation of tentative exemption section.
Exemption from the withholding requirements on the proceeds Line 1. Enter the purchase price of the property. This is the
of the sale of real property and associated personal property in contract amount for the original purchase. DO NOT
Maryland by nonresident individuals and nonresident entities. A include settlement costs or other adjustments in this
nonresident entity is defined to mean an entity that: (1) is not line. If inherited property, use the Date of Death value
formed under the laws of Maryland and (2) is not qualified by or of the property. You must attach an original settlement
registered with the Department of Assessments and Taxation to statement, property tax printout (available at www.dat.
do business in Maryland. state.md.us), original contract, date of death appraisal,
Who May File an Application or other proof of original purchase price or inherited
An individual, fiduciary, C corporation, S corporation, limited value.
liability company, or partnership transferor/seller may file Form Line 2. Enter amount of capital improvements. This line is
MW506AE. Unless the transferors/sellers are spouses filing a OPTIONAL. However, you must attach paid invoices
joint Maryland income tax return, a separate Form MW506AE is or receipts with cancelled checks for improvements.
required for each transferor/seller. Documentation must include proof of payment, address
IMPORTANT: The completed Form MW506AE and all required of property, and work completed.
documentation must be received by the Comptroller of Maryland Line 3. Settlement costs. You must attach a settlement
no later than 21 days before the closing date of the sale or statement for this amount. You may add both
transfer to ensure timely receipt of a Certificate of Full or settlement costs for purchase and sale of the property
Partial Exemption. Applications with no closing date will not be if you have a settlement statement for each. If a
processed. preliminary settlement statement is not available at
The Comptroller’s decision to issue or deny a Certificate time of filing, you must forward as soon as completed
of Full or Partial Exemption and the determination of the in order to be credited for these costs. You may request
amount of tax to be withheld if a partial exemption is this from the settlement agent.
granted are final and not subject to appeal. Line 4. Add lines 1 through 3.
SPECIFIC INSTRUCTIONS Line 5. Depreciation. Enter all depreciation already taken for
Transferor/Seller’s Information this property, if rental or commercial, on any income
tax return. You must attach a depreciation schedule or
Enter the name, address and identification number (Social returns.
Security number or federal employer identification number)
of the transferor/seller applying for the exemption. If the Line 6. Adjusted basis. Subtract line 5 from line 4. This is your
transferor/seller was issued an individual taxpayer identification adjusted basis.
number (ITIN) by the IRS, enter the ITIN. Line 7. Contract Sales Price. Enter contract sales price. You
Check the box indicating the transferor/seller’s entity type. must attach current contract (page 1 and signature
pages only) or preliminary settlement statement.
Enter the transferor/seller’s ownership percentage of the
property. For example, if there are four equal owners, enter Line 8a. Amount subject to tax. Subtract line 6 from line 7.
25% for single application. Line 8b. Multiply Line 8a by percentage of ownership.
Property Information Line 9. Tax Rate. Select which tax rate applies.
Enter the description of the property, including the street Line 10. Tentative Withholding Amount. Multiply line 8b by the
address(es) for the property as listed with the State Department tax rate. This is the tentative amount of withholding.
of Assessments and Taxation (SDAT), including county. If the If zero or less than zero, enter zero. If zero, you may
property does not have a street address, provide the full property qualify for a full exemption (subject to verification).
account ID numbers used by SDAT to identify the property. Note: This amount will be calculated by the Comptroller’s Office
Enter the date of closing for the sale or transfer of the property. based on actual documentation received.
Application will not be processed if left blank. Special Situations
Enter the property account ID number, if known. If the property Principal Residence.
is made up of more than one parcel and has more than one
property tax account number, include all applicable property Transfer is of your principal residence as defined in §121 of the
account ID numbers. Internal Revenue Code, which means it has been your principal
residence for two of the last five years. Resident income tax
Check the box to indicate whether the property was used returns for that period must have been filed to claim principal
for rental/commercial purposes. Maryland law requires that residence. This will be verified by the Comptroller’s Office.
nonresidents owning real property in Maryland file a nonresident
income tax return reporting any rental income or loss. If you Principal Residence – Active-duty Military, Certain
checked the rental/commercial box and did not file returns Government Employees.
reporting this income or loss, your application will be denied. Transfer is of your principal residence as defined in §121 of
File all appropriate returns before filing this application. the Internal Revenue Code, if you had a move necessitated by
Relocating Sellers government orders or are stationed in Maryland. Attach transfer
orders and proof of residency. This may include federal income
If you are selling your house through a relocation company, please tax return with Maryland address, utility bills, property tax
see the MW506AE – Relo Addendum for further instructions. statements, etc. See Internal Revenue Service Publication 523.
You must complete the MW506AE – Relo Addendum and attach

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Tax-Free Exchange for purposes of §1031 of the Internal Address to Mail Certificate if Issued
Revenue Code. Provide the name and address of the title company or settlement
Required documentation in addition to that on page 1; letter agent to whom we should mail the exemption certificate if
signed by the qualified intermediary, or by the person authorized issued. If you do not know the identity of the title company or
to sign on behalf of a business entity acting as the qualified settlement agent at the time you complete this form, you must
intermediary, which states the name(s) of the transferor(s), email the name and address to nrshelp@marylandtaxes.gov as
the property description, that the individual or business will be soon as possible. You must provide a mailing address to avoid
acting as the qualified intermediary for the transferor(s) as part delay in recording the sale.
of a §1031 exchange of the property, whether there will be any Signature(s)
boot, and if so, the amount of boot. The amount of any boot
must be stated on the application as the taxable amount. Form MW506AE must be signed by an individual (both taxpayer
and spouse, if filing a joint Maryland income tax return), or a
Transferor/seller is receiving zero proceeds from this responsible corporate officer.
transaction.
Include a daytime telephone number where you can be reached
Note: This situation applies when all proceeds go to another between 8:00 AM and 5:00 PM.
seller/co-owner. This does not apply if you receive ANY proceeds.
If you would like to be contacted by email in the event that more
Required documentation in addition to that on page 1; copy of information is needed to process your application, include your
a letter from the transferor/seller to the title company advising email address and check the box allowing us to contact you by
they are to receive zero proceeds from the sale and advising to email. The exemption certificate, if issued, will not be emailed
whom the proceeds are to go; a copy of the acknowledgment to you.
letter from the title company to the transferor/seller that all
proceeds are to go to another seller/co-owner. Your signature(s) signifies that your application, including all
attachments, is, to the best of your knowledge and belief, true,
Transfer is pursuant to an installment sale under §453 of correct and complete, under penalties of perjury.
the Internal Revenue Code.
If a power of attorney is necessary, complete Maryland Form
Required documentation in addition to that on page 1; copy 548 and attach to your application.
of contract of sale or copy of settlement sheet from the title
company; copy of promissory note to transferor which will be Where to File
executed by transferee at settlement. That portion of the total Mail the completed form and all attachments to:
payment that the transferor receives at or within sixty (60) days Comptroller of Maryland
of settlement must be stated on the application as the taxable Revenue Administration Division
amount. Attn: NRS Exemption Requests
Transfer of inherited property is occurring within 6 P.O. Box 2031
months of date of death. Annapolis, MD 21404-2031
Required documentation in addition to that on page 1; provide OR
a copy of the death certificate and a copy of the estimated Email the completed form and all attachments to nrshelp@
settlement sheet from the title company. marylandtaxes.gov
Transferor/seller is the custodian of an individual Note: The email submission will not expedite the processing of
retirement account. your application. If you are emailing large attachments, send
Required documentation in addition to that on page 1; provide a multiple smaller emails.
copy of the preliminary settlement sheet from the title company, Submit your application via only one method.
the custodian’s Certificate of Good Standing from its state of
incorporation, and a letter from the title company stating that Additional Information
all proceeds will be disbursed to the custodian. For additional information visit www.marylandtaxes.gov,
Transfer is pursuant to a specific Internal Revenue Code email nrshelp@marylandtaxes.gov or call 1-800-MDTAXES
section. See addendum. (1-800-638-2937) or 410-260-7980 in Central Maryland.

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     MARYLAND
                                                                                                                   2021
     FORM                           ADDENDUM FOR APPLICATION FOR

MW506AE                      CERTIFICATE OF FULL OR PARTIAL EXEMPTION

Code Letter IRC Section Description                        Required Documentation
a           § 351       Transfer  is to a  corporation     Copy  of  the  agreement  of  sale;  Certificate  of  Good  Standing  of 
                        controlled  by  the  transferor  transferee  issued by  the  state  in which transferee  is incorporated; 
                        for  purposes  of  §  351  of  the notarized affidavit executed on behalf of transferee by its President 
                        Internal Revenue Code.             and  its Treasurer  stating  that  immediately  after  the  exchange  the 
                                                           transferor(s) will own stock in the transferee possessing at least eighty 
                                                           percent  (80%)  of  the  total  combined  voting  power  of  all  classes  of 
                                                           transferee’s stock entitled to vote and at least eighty percent (80%) 
                                                           of  the  total  number  of  shares  of  all other  classes  of  stock  of  the 
                                                           transferee;  and  an  appraisal  establishing the  fair  market  value,  at 
                                                           the  time  of  the  exchange,  of  any  property  other  than  stock  in  the 
                                                           transferee  which is part  of  the  consideration for  the  exchange. The 
                                                           fair market value of any such other property and/or any money which 
                                                           is part of the consideration for the exchange must be stated on the 
                                                           application as the taxable amount.
b           § 361       Transfer  is pursuant  to  a  Copy  of  agreement  governing  the  transfer  between  transferor  and 
                        tax-free reorganization    as      transferee; Certificates of Good Standing of transferor and transferee 
                        described  in §  361  of  the  issued  by  the  state(s)  in  which  transferor  and  transferee  are 
                        Internal Revenue Code.             incorporated; copy of the plan or reorganization showing that transferor 
                                                           and  transferee  are  parties  to  the  reorganization;  and  an  appraisal 
                                                           establishing the fair market value, at the time of the exchange, of any 
                                                           property other than stock or securities in the transferee which is part 
                                                           of the consideration for the exchange and will not be distributed by the 
                                                           transferor in pursuance of the plan of reorganization. The fair market 
                                                           value of any such other property and/or any money which is part of 
                                                           the consideration for the exchange must be stated on the application 
                                                           as the taxable amount.
c           § 501(a)    Transfer  is by  a  tax-exempt  Copy of determination by the Internal Revenue Service that transferor 
                        entity for purposes of § 501(a)  is a tax-exempt entity for purpose of § 501(a) of the Internal Revenue 
                        of  the  Internal  Revenue  Code   Code; Certificate of Good Standing of transferor issued by the state 
                        and transfer involves limited or   in  which  transferor  is  incorporated;  notarized  affidavit  executed  on 
                        no unrelated business taxable  behalf of transferor by its President and by its Treasurer stating that 
                        income  under  §  512  of  the  the transfer involves limited or no unrelated business income under § 
                        Internal Revenue Code.             512 of the Internal Revenue Code.
d           § 721       Transfer is to a partnership in  Copy  of  agreement  governing  transfer  between  transferor  and 
                        exchange for an interest in the  transferee; copy of the partnership agreement of the transferee.
                        partnership  such that  no gain 
                        or  loss is recognized under  § 
                        721  of  the  Internal  Revenue 
                        Code.
e           § 731       Transfer is by a partnership to  Copy  of  agreement  governing  transfer  between  transferor  and 
                        a partner of the partnership in  transferee; copy of the partnership agreement of the transferor.
                        accordance  with § 731  of  the 
                        Internal Revenue Code.
f           § 857       Transfer is treated as a transfer  Copy  of  agreement  governing  transfer  between  transferor  and 
                        by  a  real  estate  investment    transferee;  certified  copy  of  Articles  of  Incorporation  of  transferor; 
                        trust for purposes of § 857 of     Certificate of Good Standing of transferor issued by the state in which 
                        the Internal Revenue Code.         transferor is incorporated.
g           § 1033      Transfer  is pursuant  to  a  Copy  of  agreement  governing  transfer  between  transferor  and 
                        condemnation  and  conversion  government  body  or  authority  condemning  the  property;  notarized 
                        into  a  similar  property  for    affidavit  executed  by  transferor  stating  that  transferor  will  identify 
                        purposes  of  §  1033  of  the  and  purchase  replacement  property  within the  time  limits required 
                        Internal Revenue Code.             by § 1033 of the Internal Revenue Code, or copy of contract of sale 
                                                           if transferor has already identified replacement property. If proceeds 
                                                           from condemnation exceed price of replacement property, the excess 
                                                           must be stated on the application as the taxable amount.
h           § 1041      Transfer  is between  spouses  Copy of marriage license or divorce decree; copy of deed which will 
                        or incident  to divorce  for  be recorded to accomplish the transfer; if incident to divorce, copy of 
                        purposes  of  §  1041  of  the  section of court order or separation agreement governing transfer of 
                        Internal Revenue Code.             the property.
i           § 1368      Transfer  is treated  as  a  Copy  of  agreement  governing  transfer  between  transferor  and 
                        transfer  by  an  S  corporation  transferee;  copy  of  approval  by  the  Internal  Revenue  Service  of 
                        for purposes of § 1368 of the      transferor’s  S-corporation  election;  Certificate  of  Good  Standing  of 
                        Internal Revenue Code.             transferor issued by the state in which transferor is incorporated.
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