Maryland workers can defer up to $24,500 to a 401k in 2026, plus an $8,000 catch-up at age 50+, with combined employee and employer contributions capped at $72,000. Maryland imposes state income tax with a top marginal rate up to about 5.75%, and many filers also owe county or local income tax. Traditional 401k deferrals typically reduce Maryland taxable income as well as federal. Typical employer matches are often 3–6% of pay. Educational only.
401(k) and IRA projections update as you type — educational only.
Maryland: state top ~5.75% plus local income tax — traditional 401(k) deferrals usually reduce MD taxable income; model is federal-focused. Not financial or tax advice.
IRS cap $24,500/yr
Simplified model: 100% match up to this % of salary. Actual employer formulas vary (e.g. 50% up to 6%, tiered match, etc.)
Your contributions grow as your salary grows.
Projected balance
$1,472,304
The 4% rule is a general guideline, not a guarantee. This is not financial advice.
Balance breakdown (stacked)
| Type | 2026 Limit | Notes |
|---|---|---|
| Employee contribution | $24,500 | IRS |
| Catch-up (age 50+) | +$8,000 | Total $32,500 |
| Catch-up (age 60–63, if eligible) | +$11,250 | Enhanced catch-up (federal) |
| Total with employer match | Up to $72,000 | Combined limit |
Maryland combines a state income tax (top marginal rate up to about 5.75%) with county and, in some areas, local income taxes. Pre-tax traditional 401k deferrals generally reduce both federal and Maryland taxable wages, which can lower combined state and local tax while you are working. Traditional 401k distributions are generally taxable for Maryland purposes in retirement, including local components where applicable. Roth 401k tradeoffs should be reviewed with a tax advisor given local variation.
| Monthly Contribution | Years | 7% Return | Est. Balance |
|---|---|---|---|
| $500 | 20 | 7% | ~$262,000 |
| $1,000 | 20 | 7% | ~$524,000 |
| $2,042 ($24,500/yr) | 20 | 7% | ~$1,071,000 |
| $2,042 ($24,500/yr) | 30 | 7% | ~$2,467,000 |
Traditional 401k deferrals reduce federal and generally Maryland taxable income now, which matters when state rates reach about 5.75% plus local add-ons. Roth 401k forgoes that deduction for potential federally tax-free qualified withdrawals. Typical 3–6% employer matches are often traditional dollars. Many workers max the match, then weigh traditional vs. Roth for additional savings.
The IRS limit for employee 401k deferrals is $24,500 in 2026. Workers aged 50 and older may contribute an additional $8,000 catch-up for $32,500 total. Optional higher catch-ups may apply at ages 60–63 under federal rules. Combined employee and employer contributions can reach up to $72,000 in 2026 (plus catch-ups where allowed).
Maryland has a state income tax with a top marginal rate up to about 5.75%, and many residents also pay county (and in some cases city) local income tax on top. Traditional 401k salary deferrals generally reduce both federal and Maryland taxable income, lowering current state and local tax. Distributions from traditional 401k accounts are generally taxable in Maryland when taken.
Many Maryland employers match about 3% to 6% of salary when you defer enough to earn the full match. Always capture the full match if you can. The combined employee-employer limit is $72,000 in 2026 before age-based catch-ups.
Traditional 401k lowers federal and generally Maryland taxable income now — including against state rates up to about 5.75% plus local add-ons. Roth 401k uses after-tax dollars but can provide federally tax-free qualified withdrawals; confirm Maryland and local treatment of Roth distributions with a tax advisor.
Total contributions from you and your employer generally cannot exceed $72,000 in 2026 (plus allowed catch-ups). Employer matching dollars count toward that cap.
Many employers offer Roth 401k. After-tax contributions can grow federally tax-free if qualified; weigh Maryland state and local tax on Roth contributions today against your expected retirement tax picture.
Educational estimates only. Not financial or tax advice.