How to Start a Maryland LLC
Maryland LLC Formation – Basics & Helpful Information
This article is meant to be a general overview of the Maryland LLC formation process; including information about how to start a Maryland LLC and other basic issues related to Maryland LLCs.
Maryland Filing Fees
The fee to file your Articles of Organization to form a Maryland LLC is $100.00 plus $50.00 to expedite the filing for a quicker turn around.
Maryland Filing Time
Regular processing time to file mailed in documents can be up to 8 weeks or more. Expedited processing for an additional fee of $50.00 reduces the turnaround time to 7 business days, or same day processing if documents are hand-delivered between 8:30 and 4:30 and if you are in line by 4:15pm. Documents filed online are considered expedited and are processed within 7 business days.
Maryland Annual Compliance Requirements
Maryland LLCs are required to file a Personal Property Return by April 15 each year to the Maryland Department of Assessments and Taxation, for a fee of $300.00. The report may be filed online or on paper and mailed in. Failure to file this return will result in forfeiture of the right to conduct business in Maryland. LLCs are not required to pay a franchise tax or a privilege tax.
How to Form an LLC in Maryland
You can use this checklist to help guide you through the process of forming a Maryland LLC:
The first step in creating an LLC in Maryland is naming your business. You’ll need to check with the Maryland Department of Assessments and Taxation to make sure the name you’ve chosen is available. You can do this online via the Maryland Business Search.
It is also highly recommended that you check the US Patent and Trademark Office to see if someone has a federal trademark of the business name you want (the Maryland Department of Assessments and Taxation will not check other state’s databases or the federal trademark database). You can click here to have a comprehensive name availability search performed for you.
Your LLC name must contain one of the following, “limited liability company” or the abbreviations “L.L.C”, “L.C.”, “LLC”, or “LC”. The name of the LLC must not be misleadingly similar to another business entity already on file at the Maryland Department of Assessments and Taxation.
Maryland Trade Names
A trade name is similar to a “doing business as” (DBA) name. Although a trade name is not legally required, it is a wise business practice. The filing fee to file a Maryland Trade Name Application is $25.00. For an expedited fee of $50.00, the trade name application can be filed while you wait if submitted in person. The filing is effective for 5 years and may be renewed during the last 6 months for an additional 5 years. Maryland trade names are only applicable in Maryland and are not substitutes for a national trademark filing.
Maryland Articles of Organization
Your Maryland LLC is formed by signing and filing Articles of Organization with the Maryland Department of Assessments and Taxation. You can also e-file the Maryland Articles of Organization for an additional $3.00 service fee. The Maryland Department of Assessment and Taxation staff will examine the articles for statutory compliance and will either approve the articles for filing or reject the articles with instructions on how to resubmit the document.
The Articles of Organization must include at a minimum:
- Name of the Maryland LLC
- Purpose of the Maryland LLC
- Physical or street address of the LLC in Maryland, post office boxes may not be used
- Resident Agent’s name, address, and signature
- Organizer’s Name and Signature
Maryland Resident Agent Information
Maryland requires that the LLC have a Resident Agent (also known as the Registered Agent in some states), which is an individual or a business entity the LLC appoints for the purpose of accepting service of process (lawsuit papers or legal documents) for the LLC. An LLC cannot be its own resident agent, but the LLC can appoint one of its members as the resident agent. Maryland law requires that the resident agent be a citizen and resident in the state of Maryland and have a permanent, physical address on the records of the Maryland Secretary of State at all times. The resident agent can also be a Maryland corporation.Read more about Resident Agents →
The governing document for an LLC is called the “company agreement” or sometimes the “operating agreement”. The company agreement is to an LLC like a partnership agreement is to a partnership (or bylaws to a corporation). The company agreement governs the internal operation of the LLC and is typically a private document that is kept in the company book and the principal place of business (it is NOT filed with the state). The company agreement can address many issues, some of the more common concepts found within a company agreement are:
- Limitations on the members liabilities
- The level of consent needed to take various actions (i.e. simple majority required to add new members)
- The percentage of the LLC that each member owns
- How profits and losses are allocated between the members (typically based on ownership percentages)
- Limitations on transferability
- What each member is contributing to the LLC and what happens is such contributions are not made.
- The authority of the members, officers, managers, committees, etc.
- How meetings are conducted
One of the reasons we recommend using an LLC formation company like IncFile is that they can provide you with a company agreement in connection with their LLC formation services.
- Apply Online Yourself: The IRS has an online EIN Application you can use to get an EIN. The turn around time on the EIN using this method is only a few minutes.
- Use Form SS-4: You can get an EIN the old fashion way by completing Form SS-4 and mailing or faxing into the IRS. How long does it take to get the EIN this way? According to the IRS: if you mail in Form SS-4, it will take 4-5 weeks to get your EIN. If you fax in Form SS-4 you should have the EIN back in a week if you provide a fax number or 2 weeks if you don’t have a fax number.
- Have a Third-Party Obtain: All of the LLC formation companies have the ability to get the EIN for you. The EIN obtainment charge varies by company, but it is generally between $50 and $100. If you get one of the higher priced packages, they will sometimes throw in the EIN for free.
After you create your new Maryland LLC, you’ll need to determine if your business/profession requires any licenses or permits to conduct business.Read more about Maryland Licensing and Permitting →
If you have a non-Maryland LLC (aka Foreign LLC) and you are doing business in Maryland, you may need to register the Foreign LLC in Maryland. Each state has a different definition of “doing business”. In Maryland, the kinds of activities that would not constitute “doing business” are outlined in the Annotated Code of Maryland, Section 4A-1009.
The filing fee for the Foreign Limited Liability Company Registration in Maryland is $100.See more about registering a foreign LLC in Maryland →