Maryland is a great place to start an LLC. This guide will show you how to form an LLC in Maryland. We will guide you step-by-step through the process and highlight important considerations.
Maryland LLC Formation
While the process for forming an LLC can be quite straightforward, there are some things you need to do before you file with the state.
Find out if your preferred name is available
You should use the Business Entity Search state website option before you attempt to file for a company name not available in Maryland. This is a good time to verify if there is a website domain that matches yours.
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Keep a long-term budget in mind
Maryland LLC formation costs $100. However, there are additional fees. Maryland LLCs are required to file an annual report, and pay a $300 fee. You must file a personal property tax return if your LLC uses, owns, leases, or has personal property in Maryland.
To set up your LLC, you may need to pay an accountant, lawyer or other professional. You may also be charged an annual fee to serve as a resident agent.
Cost of setting up an LLC in Maryland
Maryland charges $100 to create an LLC. There is an additional $50 charge if you wish to expedite your filing. Additional fees for a Certificate Status are $20 at the time you file.
Maryland LLC Setup
Once you have all the information you need, you can begin the process of setting your LLC up. Your business will be ready in no time if you have everything necessary.
Name your business entity
You can still hold your LLC name for 30 days if you have confirmed your LLC name availability but are not ready to create your LLC. To do this, file a Corporate name reservation application. You will need to pay a $25 standard fee and an additional $20 for expediting the process.
Note that your business name must contain the words “limited liability corporation” or one of the acceptable abbreviations “LLC,” L.L.C.,” L.C.” or “LC.”
A resident agent (also known as a registered agents) is required to form an LLC in Maryland. A resident agent can be either an owner or employee of the business, provided that they are at least 18 years old and a Maryland resident. An LLC or Maryland corporation can also serve as resident agent.
You can also hire a company that specializes in acting as your agent. The service is usually between $100 and $300 per annum, although some companies offer it for as low as $50. To ensure that you are getting the best value for your money, do as much research as possible.
Send your Articles of Organization
Online registration is the fastest and most convenient way to create your LLC. It is important to have a street address when forming your LLC. PO boxes are not acceptable.
Alternately you can fill out an Articles of Organization Form. Make sure to include your resident agent’s signature. Send the completed form to:
Department of Assessments and Taxation301 W. Preston Street
Baltimore, MD 21201-2392
The fee for forming an LLC in Maryland is $100 Online submissions can be processed in seven business days. Paper filings can take up to six weeks. For $50 more, paper filings can be expedited to be processed in seven days. For $20, you can get a certified copy of your document. Each additional page costs $1. A Certificate of Status can be purchased at the time you file your document for $20.
Maryland LLC Formation
There are some additional steps that you need to take even after your LLC has been established. While they may not be legally required, they are strongly recommended to ensure the long-term success and viability of your business.
Make an LLC Operating Agreement
The operating agreement is basically a set of rules that govern how your LLC will operate. It covers everything, from the way the business will operate day-to-day to how much each member will contribute. An LLC operating agreement, although not mandatory, is a useful guideline and can help to avoid future disputes with business partners. It is also necessary to lend legitimacy to your company.
Register for an Employer Identification Number (EIN).
EINs are required for most businesses. Also known as Federal Tax Identification Numbers (FTIN) or Federal Employer Identification Numbers (FEIN), an EIN is also called a Federal Tax Identification Number. If your LLC is single-member and does not have employees, your Social Security Number can be used instead. An EIN protects your Social Security number’s privacy even though it is not necessary. You can get one free of charge through , the official IRS website.
Make an annual report
Maryland requires that you file an annual report outlining information about your business activities and gross sales. This form must be submitted by April 15th. There is a $300 annual fee. The cost of the LLC’s annual $300 fee is the same, regardless of whether it is located in the United States or abroad.
Correction of Maryland LLC Filing Errors
If you submit LLC documents and later discover there were errors, you can file Articles for Amendment. It is recommended that you use a typewriter or computer to complete the documents. Handwritten submissions are more likely be rejected.
Articles of Amendment cost $100. Standard processing takes 6-8 weeks. You can pay $50 more to speed up the process. If you submit your application online, the state will charge you the expedited rate. You can avoid this by sending your application to Maryland State Department of Assessments and Taxation.
Change your Resident Agent
You should follow the steps above to create your Maryland business entity. Also, double-check with Maryland about the current laws, forms, and fees associated with LLC filing. Things can change at any moment, so you must be fully informed about the process.
Frequently Asked Questions
What is an LLC?
LLC stands for Limited Liability Company. These entities offer owners liability protection and pass-through taxation.
What is the cost of forming an LLC?
The cost of an LLC varies from one state to the next. The fee for Kentucky is $40 and Massachusetts $500, respectively. To find the fee schedule for your state, it is best to visit the website of your state’s Business Formation.
What’s the difference between an LLC & a DBA?
DBA is shorthand for “doing business under” and it’s a registered trade name. This does not provide the same legal protection as an LLC.
What tax flexibility can an LLC offer?
LLCs can be taxed in a variety of ways: as partnerships, sole proprietorships, C corporations, or S corporations. This allows LLC members to reduce their tax burden.