flipping a MD property but not a MD resident
Hello,
I want to flip in Maryland, infact I have one property which I will be going for closing soon but I know Maryland has this law if you are a nonresident and have not lived in the property 2 years out of the 5 years when you do sell your property they will withhold 7.25% of the sales price.
Is there a way to go around this? Maybe form a LLC in Maryland and have a friend that lives there as a agent?
Most Popular Reply
As @Russell Brazil says, there is a form to file if you wish to ask for an exemption. But you can also either have an MD LLC or register your foreign (non-MD) LLC in MD with the State Department of Assessments and Taxation ("SDAT"). Both of those methods will enable you to avoid the withholding. I would recommend registering your LLC with the MD SDAT because cash-flow is a major concern for being in the flipping business. Here is some great information on the withholding requirements in MD.