Yes, Maryland only taxes nonresidents on income earned in the Old LIne State.
The most common reason for owing a large amount of Maryland tax is that your employer did not withhold county tax. Many Maryland counties have a county tax that's added to your MD return.
Check your W-2. Do you have local wages and withholding on lines 18-20? Next, check lines 17 and 18 on Form 505NR. You will are either being charged the 2.25% special nonresident tax or a county tax.
A second reason you may owe tax is because Maryland uses your total income to set your base tax rate. You are then taxed on the Maryland percentage of the total tax you would pay if all your was earned in Maryland.
That means nonresidents often end up with a higher tax rate than the withholding rate on their W-2, meaning they end up owing tax.
You can see this computation on lines 154-16 on Form 505NR.
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