In 2020, Maryland saw a 28.8% increase in business applications. It’s a growing hub of new start-ups and small businesses, making it a great place to become an entrepreneur.
If you’re looking into how to register an LLC in Maryland, below we cover everything from how to get an LLC in Maryland to the costs involved. You can also download a Maryland LLC Operating Agreement template to make the process easier.
Is an LLC Operating Agreement Required in Maryland?
Maryland does not require businesses to have an LLC Operating Agreement. Although you don’t legally need an operating agreement, you should still create one for internal use. The operating agreement outlines:
- Distribution of profits and ownership
- Company goals, regulations, and structure
- LLC member obligations
- Restructuring or bankruptcy procedures
- Decision-making processes
Operating agreements are especially critical for multi-member LLCs. In the event of any legal proceedings, operating agreements provide a framework for handling issues.
Maryland Operating Agreement Laws
The laws for Maryland are published in Article 5A-402 for Corporations and Associations. But let’s take a quick look at some LLC requirements specific to Maryland:
Types of LLCs
Most states allow single-member (SMLLC) and multiple-member LLCs (MMLLC). But Maryland is the only state that only registers MMLLCs. You’ll need a team of at least two members to apply for an LLC.
Like most states, Maryland has set rules for creating your LLC’s name. It must contain one of the following:
- Limited Liability Company
The name cannot resemble that of another business registered with the Maryland Department of Assessments and Taxation. Save yourself the hassle and check your name on the Maryland Business Name Database first.
By law, every LLC registered in Maryland requires a registered agent. They are the legal representative for your business. Your agent must be:
- A Maryland citizen
- Over 18 years of age
- Have a physical address in the state
An agent can also be a corporation or another LLC. Registered agents, known as resident agents in Maryland, receive and process legal notices for your business.
To register your LLC in Maryland, you need to file your articles of organization. This document can be easily submitted to the Maryland Department of Assessments and Taxation. There are both online and in-person filing options.
Some states require annual reports, and Maryland happens to be one of them. You can file the Annual Report and Personal Tax Form online through the Maryland Business Express portal. Alternatively, you can submit your documents by mail or in person.
How Much Does it Cost to Form an LLC in Maryland?
The cost of registering an LLC is low compared to other states. Here’s a breakdown of the filing costs:
- Domestic Filing Fee: $100
- Foreign Filing Fee: $100
- Annual Report and Tax Return: $300
- Personal Property Tax Return: $0
Regardless of the method, online and paper filing are the same cost. Your filing fee is a one-time fee paid upon the registration of your LLC. The Personal Property Tax Return is an annual, free submission.
How to Form an LLC in Maryland?
If you need to know how to start an LLC in Maryland, you’ll be happy to note that the process is quick and simple. With these six steps, you can enjoy the freedom of entrepreneurship:
Step 1 – Name Your Company
The first step to creating a company is using the above-mentioned guidelines to select a name. There’s no extra name registration step when creating an LLC in Maryland. Your company name is submitted along with the articles of organization.
Another option is to register a trade name. This is a good choice if you want to operate under a different name or change the name of your business. You’ll have to file a Trade Name Application with the Maryland Department of Assessments and Taxation if you want to go this route.
Step 2 – Choose a Registered Agent
The next step is nominating a registered agent using the guidelines we covered above. An interesting thing to note is that any member of the LLC can also become a registered agent. Another option is using a professional registered agent service for a fee.
Step 3 – Submit Articles of Organization
Submitting your articles of organization is the next crucial step in the process. If you choose to apply in person or by mail, you need to create the articles of organization. Submit the filled-out application to:
Department of Assessments and Taxation
301 West Preston Street
Baltimore, MD 21201
Of course, applying online through the Maryland Business Express reduces the waiting time and hassle of applying in person. Just head to the site, set up an account, and file the digital form.
Step 4 – Create an Operating Agreement
The good news is you can draft a Maryland LLC Operating Agreement yourself. If you don’t know where to start, head to our Maryland LLC Operating Agreement template at the bottom of this page. It provides a comprehensive outline for your entire team to follow and sign.
Step 5 – Stay On Top of Taxes and Regulations
Once the state approves your articles of organization, you’ll need to apply for an Employer Identification Number (EIN). An EIN is mandatory for all companies with two or more employees and is obtained through the IRS website. You’ll also be able to choose your LLC’s tax structure during the application.
Step 6 – File the Annual Report and Tax Return Form
Your report and tax return form is due every year in mid-April. You can easily file online or send the form and your payment to:
Maryland Dept. of Assessments and Taxation
Annual Report PO Box 17052
Baltimore, Maryland 21297-1052
The government of Maryland website provides all the details for your submission. And be sure to file on time as the late fees range from $50 to $500.
Maryland LLC Operating Agreement Template
Ready to enter the world of entrepreneurship? Get started now with our Maryland LLC Operating Agreement template below:
LLC Operating Agreeement