Are Gambling Winnings Taxable In Maryland? When gambling winnings are combined with your annual income, you could move into a higher tax bracket, so be aware of gambling income (and factor it into your state income tax) before you start your Maryland tax preparation. The state tax rate in Maryland is between 2% and 5.75%. The effective tax rate is the percentage you pay after standard deductions, etc., and operates on a sliding scale depending on filing status and total taxable income. The marginal tax rate is the bracket your income falls into. The rate will depend on your total taxable income (not just wages) minus deductions (standard or itemized) in Maryland. Gambling income is subject to state and federal taxes but not FICA taxes. Tax rates depend on your annual income and tax bracket.
