Forming an Maryland LLC
(2025 Guide)
2025 LLC Guide
How to Start an LLC in Maryland (Step-by-Step Guide)
Discover how to start an LLC in Maryland, our step-by-step guide. Learn the essential requirements and process to form your business today.
To establish an LLC in Maryland, you need to submit the Articles of Organization to the Maryland Department of Assessments and Taxation (SDAT). The filing fee is $150, and approval typically takes about two weeks.
Here are the five steps to complete the process:
Choose a Name for Your LLC
Select a Registered Agent
File the Articles of Organization
Draft an Operating Agreement
Obtain an EIN
If you prefer to form your LLC independently, follow our complimentary guide below.
For those who prefer assistance, we suggest hiring Northwest Registered Agent.
What is the cost to establish an LLC in Maryland?
The initial fee to start an LLC is $150, followed by an annual cost of $300.
These fees cover specific requirements: the $150 is for filing the Articles of Organization, which officially forms the LLC, while the $300 annual fee is for the Annual Report, a necessary submission to maintain your LLC’s good standing. For more details, refer to LLC Costs in Maryland.
How long does it take to form an LLC in Maryland?
Filing by mail results in approval within 5-8 weeks, including mailing time. However, filing online leads to approval in just 2 weeks. For updates on any potential delays, visit How long does it take to get an LLC in Maryland.
Here’s how to establish an LLC in Maryland
1. Search for Your LLC Name
First, search for your desired LLC name to ensure it is available in the state.
This is crucial, as two businesses cannot have the same name in Maryland. Begin by checking your business name against existing ones in the state. Use the Business Entity Search tool to confirm the uniqueness of your chosen LLC name compared to current businesses.
Next, make sure you understand the state’s naming guidelines to ensure your LLC name gets approved. We’ll provide more detailed information here: Maryland LLC Name.
2. Select a Maryland Registered Agent
The following step involves selecting a Registered Agent. A Maryland Registered Agent is an individual or company responsible for receiving legal mail and state notices on behalf of your Maryland Limited Liability Company.
Who is eligible to be an LLC Registered Agent? You have three options for appointing a Registered Agent:
You
A friend or family member
A Registered Agent Service
Maryland mandates that LLC Registered Agents must maintain a physical street address within the state. PO Boxes are not permissible. The name and address of the Registered Agent will be included in public records.
If you lack an address in Maryland or desire increased privacy, you can opt for a Registered Agent Service for your LLC.
We suggest Northwest Registered Agent
One of the aspects we appreciate most about Northwest is their willingness to allow you to use their office address for your LLC filing. This ensures your personal address is not listed in public records.
Additionally, they provide a service to scan any mail addressed to your LLC and upload it to your online account. Northwest offers exceptional customer service, and we trust them as our own Registered Agent.
3. Submit Articles of Organization
To establish an LLC, you must submit the Articles of Organization to the Maryland Department of Assessments and Taxation (SDAT).
Filing the Maryland Articles of Organization online via Maryland Business Express costs $150. This fee is a one-time payment required to set up your LLC. If you prefer to handle this on your own, refer to our detailed guide: Maryland LLC Articles of Organization. Alternatively, you have the option to hire a company to manage the process for you.
4. Draft an LLC Operating Agreement
An LLC Operating Agreement acts as a complementary document to the Certificate of Formation. While the Certificate of Formation establishes your LLC, the Operating Agreement identifies the owners of the LLC.
Moreover, many banks require an Operating Agreement when setting up an LLC bank account. It is also invaluable if legal issues arise, as it demonstrates the proper management of your LLC. For these reasons, we advise all LLCs, including Single-Member LLCs, to have an Operating Agreement.
Additionally, an Operating Agreement is considered an “internal document.” This means you don’t need to file it with the state or the IRS (Internal Revenue Service). Simply keep a copy with your business records. You can download a free template below. Then, watch our Maryland Operating Agreement video for a step-by-step guide on how to complete it.
5. Obtain an EIN for Your LLC
The following step is to secure a Maryland EIN from the IRS for your LLC. Note: An EIN, also known as a Federal Tax ID Number or Federal Employer Identification Number, is essential.
An EIN is needed to:
– Identify your LLC for tax purposes
– Open a business bank account
– Apply for business licenses and permits
How much does an EIN cost? The IRS provides an EIN at no charge.
How long does it take to receive an EIN? Online applications are processed in 15 minutes, while mail or fax applications may take 1-3 months.
How can I obtain an EIN?
– US Citizens/Residents: With an SSN or ITIN, apply online. Follow these instructions: Apply for an EIN online.
– Non-US Residents: You can’t apply online, but you can obtain an EIN via fax or mail. See these instructions: How to get an EIN without an SSN or ITIN.
What should I do after my LLC is approved?
Once your LLC gets the green light, there are a few more actions to consider.
Open an LLC business bank account
Setting up a business bank account for your LLC is crucial. It simplifies accounting and record-keeping for your business finances. A separate business account also fortifies your personal liability protection by distinguishing business finances from personal ones.
Get business licenses and permits
The good news is Maryland doesn’t require a state general business license. However, your LLC may need a local business license or permit based on its location. For instance, starting a daycare might require a city or county business license. More information is available on our Maryland Business License page.
File your Annual Report & Personal Property Tax Return
All Maryland LLCs must submit an Annual Report each year to maintain good standing with the state. Additionally, some LLCs need to file a Personal Property Tax Return. This tax applies to tangible personal property owned, leased, consigned, or used by the LLC. Examples include furniture, equipment, electronics, or tools, provided they are in Maryland.
How much does a Maryland Annual Report & Personal Property Tax cost?
The Annual Report filing fee is $300 annually, though the Personal Property Tax Return may incur additional costs.
When are the Annual Report & Personal Property Tax due?
Both are due by April 15th each year. The first report and tax return are due the year following your LLC’s approval. For instance, if approved on February 3, 2025, your first reports are due by April 15, 2026.
How do I file my LLC Annual Report & Personal Property Tax Return?
These documents can be filed online or by mail. The Personal Property Tax Return can be complex, so if only the Annual Report is required, online filing is recommended for simplicity. For both documents, consider consulting an accountant. For questions, contact the Maryland Business Personal Property unit. Follow our guide here: Maryland LLC Annual Report.
File and pay taxes
LLCs themselves don’t pay federal taxes; instead, the LLC Members handle taxes as part of their personal returns. How your LLC is taxed depends on the number of owners: A Single-Member LLC is taxed like a Sole Proprietorship, while a Multi-Member LLC is taxed like a Partnership. Alternatively, the IRS can tax your LLC as a C-Corporation or S-Corporation. In addition to federal taxes, there are state, local income taxes, and sales tax. Learn more in Maryland LLC Taxes.
Helpful Resources
How to Start an LLC in Maryland FAQs
Can I start an LLC online in Maryland?
Yes, you can establish your LLC online in Maryland. The fee for filing the Articles of Organization is $150. Once you file online, your LLC will be approved within 2 weeks.
What are the benefits of an LLC?
One major advantage of an LLC is the protection of personal assets. This means that if your business faces a lawsuit, your personal belongings—such as your home, vehicles, and bank accounts—are safeguarded. This protection extends to all LLC owners, known as LLC Members, whether it’s a Single-Member or Multi-Member LLC. LLC owners are shielded from business debts and liabilities, unlike those in Sole Proprietorships or Partnerships. These informal business structures do not offer such protection in legal matters. Consequently, Limited Liability Companies (LLCs) are a more popular choice. Additionally, LLCs benefit from pass-through taxation, where the LLC itself doesn’t pay federal income taxes. Instead, the profits are passed to the Members, who then pay taxes on their personal returns. State income taxes usually follow the federal tax treatment of your LLC. For further details, see How are LLCs taxed.
Is Maryland a good state to start an LLC?
Whether Maryland is a suitable state to start an LLC depends on your residence and business location. If you live or operate your business in Maryland, it’s advisable to start your LLC there. Although some websites highlight tax benefits in certain states, these don’t apply if they aren’t the state where you reside and work. For instance, forming an LLC in Delaware while living and conducting business in Maryland means you’ll need to register your Delaware LLC in Maryland, incurring extra fees and still paying Maryland taxes. This process results in additional costs and complications without benefits. In conclusion, if you reside and conduct business in Maryland, it is indeed a good state for starting a business. Conversely, if you don’t live or do business in Maryland, it isn’t an ideal state to start a business.
Real estate exception: If you’re buying real estate outside Maryland, consider forming your LLC in the state where the property is located. For more insights, please see Best State to Form an LLC.
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