How to Form an LLC in Maryland

This guide to starting an LLC in Maryland provides step-by-step instructions on filing formation documents, obtaining tax IDs, and setting up company records.

Overview

LLCs are the most popular business structure because they are inexpensive to form, provide flexibility to the owners, and are easy to run. Forming your LLC legally establishes your business, limits your personal liability, and gains tax flexibility. The following step-by-step will help you as you undertake this process.

Fast Facts: Your Budget and Timeline

Here is an overview of the total paperwork, cost, and time it takes to form an LLC in Maryland. Be sure to read the final step in this guide - "Ongoing Filings" - to understand your ongoing costs to maintain a compliant Maryland LLC.


Paperwork
  • Form ARTORGAN: Articles of Organization
  • Operating Agreement
  • IRS Form SS-4: Obtain an EIN
  • Form CRA: Maryland Combined Registration Application
Cost
  • Formation: $100 + optional $5 returned mail fee + optional $50 expedited service fee. The expedite fee is required to file online, by fax, or in-person.
Time
  • Formation: ~10+ weeks. ~7 business days with expedite fee online or by fax. Same-day if filed in-person with expedite fee by 4:15pm.

Step-by-Step Maryland LLC Instructions

Warning

Maryland LLCs must pay a $300 Annual Report/ Personal Property fee each year to Maryland SDAT by April 15th.

  1. Check Name Availability

    The legal name of your LLC may not conflict with any other registered name. Check availability of your desired name by conducting a name search.

    Name Search: Maryland State Department of Assessments and Taxation (SDAT)
    Name search
    Name Reservation: Optional
    Suffix:

    Limited liability companies.- The name of a limited liability company must include: (1) The words "limited liability company"; (2) "L.L.C."; (3) "LLC"; (4) "L.C."; or (5) "LC". 
    Maryland Code §1-502(b)

  2. Appoint a Registered Agent

    Before you officially file to create your Maryland LLC, you will need to decide who your Maryland registered agent will be. A registered agent is a business's legal appointee to receive notice of lawsuit and other legal or government notices.

    State law requires every LLC to have a registered agent. The registered agent is designated when you file Maryland articles of organization with the Maryland State Department of Assessments and Taxation (SDAT).

    Our reliable registered agent service fulfills this requirement. You get:

    • Same-day documents from our local office in Oakland
    • Immediate online access to state forms with our address and, where required, our signature
    • Annual fees from $89 to $99 per state with no additional charges

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  3. File Maryland Certificate of Formation

    File the articles of organization to create your limited liability company.

    Agency:Maryland State Department of Assessments and Taxation (SDAT)
    Form:

    Articles of Organization for Limited Liability Company

    Filing Method:

    Mail, fax, in-person, or online.

    Agency Fee:

    $100 + optional $5 returned mail fee + optional $50 expedited service fee. The expedite fee is required to file online, by fax, or in-person.

    Turnaround:

    ~10+ weeks. ~7 business days with expedite fee online or by fax. Same-day if filed in-person with expedite fee by 4:15pm.

    Law:

    Code of Maryland - Corporations and Associations - Title 5: Special Types of Corporations

    Notes:
    • If you do not pay the expedite fee, you could wait 10+ weeks for the secretary to process your articles.
    • Upon processing, you will only receive notice of filing if you pay the $5 return mail fee. Otherwise, look in the secretary's online records ~10 business days after processing to see your entity record.
    Fact Checked:6/13/17
  4. Establish Company Records

    Your LLC must keep correct and complete books and records. Your filed articles of organization are the first documents for your LLC’s records. Your LLC will generate many other official records such as:

    • Meeting minutes
    • Operating agreement
    • EIN verification letter
    • Amendments and other filings made to the LLC throughout its lifetime

    Organizations need a secure, centralized tool for managing and accessing sensitive records. Our Records Manager software offers a simple, efficient way for LLCs to store records, track members and managers, and customize meeting notifications.

  5. Create the Operating Agreement

    Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. It defines the formalities of how the LLC will run itself such as holding an annual meeting. You will review and adopt the agreement at your organizational meeting.

  6. Hold the Organizational Meeting

    The first meeting of the members of the LLC is the organizational meeting. You will need your filed articles of organization and your operating agreement in order to conduct this meeting. Keep minutes of this meeting and store them in your company record book.

  7. Get a Federal Employer Identification Number (EIN)

    If your LLC has more than one member or will hire employees, it must obtain an EIN. An EIN is also often required to open a bank account.

    Agency:Internal Revenue Service (IRS)
    Form:

    IRS Form SS-4

    Filing Method:

    Mail, phone, fax, or online.

    IRS fee:

    $0

    Turnaround:

    Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.

    Notes:

    The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.

    Fact Checked:8/28/19
  8. Get Maryland State Tax Identification Numbers/Accounts

    Newly formed organizations are automatically enrolled in Maryland property tax.

    Register for a Maryland tax accounts and licenses by filing:

    Submit to:
    Comptroller of Maryland
    http://www.comp.state.md.us/
    Form:
    Form CRA: Maryland Combined Registration Application
    Filing Method:
    Mail or online
    Fee:
    $0
    Notes:
    This registration includes an admissions and amusement tax account, alcohol tax license, income tax withholding account, motor fuel tax account, sales and use tax license, use tax account, transient vendor license, sales and use tax exemption certificate (for nonprofit organizations), tire recycling fee account, tobacco tax license, and/or unemployment insurance account.

    Other local taxes in Maryland require no additional registration. Questions can be directed to Maryland local taxing agencies.

  9. Consider Electing S-Corp or C-Corp Taxation

    By default, your LLC receives pass-through taxation and the vast majority of LLCs keep this tax classification. Some LLCs benefit from electing S-Corp or C-Corp tax treatment:

    • S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
    • C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment. File Form 8832: C-Corp Election.
  10. Obtain Business Licenses & Permits

    To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.


    Maryland Business License

    Not required



    General Business License licensure is not required on the State level in Maryland.

    Maryland does not have a general business license at the state level, but local licenses are often required.

  11. Ongoing Filings to Maintain Your LLC

    You must file federal and state tax returns.

    Many states also require business entities to file an annual report to maintain good standing with the secretary of state. If an annual report is required for LLCs formed in Maryland, view the table below.


    Maryland Corporation Annual Report Requirements:

    Agency:Maryland State Department of Assessments and Taxation (SDAT)
    Form:

    Form 1 - Annual Report and Personal Property Tax Return

    Instructions:

    Instructions for Form 1

    Filing Method:

    Mail or online

    Agency Fee:

    $300 + $9 credit card fee.

    Due:

    Annually; must be postmarked by April 15.

    Law:

    Md. TAX-PROPERTY Code Ann. § 11-101.

    Penalties:

    If your business has property in Maryland, then the late fee is a percentage of your county assessment plus interest. If your business does not have property in Maryland, then there is no late fee. All businesses risk dissolution or revocation.

    Notes:
    • Must be signed by officer or principal.
    • Original signatures are required.
    Fact Checked:1/11/21

    For more details, see our Maryland annual report information center page.

    As your LLC grows, you will need to demonstrate your company’s good standing to banks, customers, and other state agencies. After all the work involved in forming your Maryland LLC, don’t let a missed annual report filing cause your new business to fall out of compliance.

    Tracking and filing annual reports on your own can be time consuming and lead to accidental lapses. Protect your LLC’s good standing with Managed Annual Report Service, which tracks and automatically files reports on time, every time, so you can focus on your business.

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