How To Start An LLC In Maryland

It is easy to start a Limited Liability Company (LLC) in Maryland. You can do the whole process online within a few minutes. 

The Articles of Organization must be filed with the Maryland Department of Assessments and Taxation for a set fee to incorporate a Maryland LLC. 

You can submit your application online, by mail, or in person. The Maryland Limited Liability Company’s Articles of Organization are the legal documents that establish the company.

StateMarylandPennsylvaniaVirginiaDelawareUS Average
Population6,165,12912,964,0568,642,274989,9486,619,825
LLC Filing Fee$100$125$100$90$130.38
LLC Annual/Biennial Fee$300 (every year)$70 (every 10 years)$50 (every year)$300 (every year)$89.34 (every year)
Corporate Tax Rate8.25%9.99%6.00%8.70%5.60%
Nominal GDP per capita$71,083$64,751$68,483$80,446$64, 773.08

Before Setting Up An LLC In Maryland

To set up an LLC in Maryland, there are several requirements you must put in place first. It is advisable to set aside these requirements before you embark on the process. The basic needs are as follows.

  • Create a company name.
  • Have Articles of Organization in place.
  • Hire an appointed agent.

Cost Of Starting An LLC In Maryland

It costs $100 to register an LLC in Maryland. If you are wondering how to start an LLC in Maryland for free, you will be disappointed. You must pay this registration fee. 

Additional costs may arise from hiring experts to write articles of association and articles of organization for you. These can further raise your costs.

Steps To Start An LLC In Maryland

Steps To Start An LLC

You must go through the following steps to create your LLC in Maryland.

Pick A Name For Your LLC

This is a crucial step in commencing the registration of your company. The name is the identifier with which the company will be known. It is also the brand with which your company will be recognized. 

The name should therefore capture what the company is all about as much as possible. It should be catchy but not too wordy. One to three words are enough for a company name. 

In addition, you will add Limited Liability Company or LLC to the name for it to be complete.

The steps to creating a name are as follows.

  1. Choose the name you want.
  2. Conduct a name search to see if the one you choose is unique. You can search the Maryland Business Entity Search site.
  3. Once you confirm the name, then you can use it for registration.

Find A Registered Agent In Maryland

Do you need a registered agent in Maryland? Yes, you do require a registered agent in Maryland. The registered agent has an obligation to accept papers in case the LLC is sued. 

ZenBusiness – $49 + state fees to register your LLC (read review)
Incfile – $0 + $50 state fees to register your LLC (read review)

Articles Of Organization

Rules that govern the LLC you are forming are called Articles of Organization. The Articles of Organization must be filed with the state authorities for you to register the LLC legally. 

The articles must include the LLCs name, purpose, physical location address in Maryland, and the registered agent’s name, address, and signature. 

For guidelines on the specific requirements in the Articles of Organization, you can refer to the Maryland Articles of Organization site.

Articles Of Organization

Other Required Documents

The main items you need to register an LLC in Maryland are the ones above.

Operating Agreement

You may, however, be required to prepare an operating agreement for your LLC. This is not an essential requirement for registration in Maryland. However, the agreement will help to define how the organization will operate. It includes the following.

  1. The percentage interest of members in the LLC
  2. Rights and responsibilities of members
  3. Voting powers of members
  4. Allocation of profits and loses
  5. Rules of meetings and taking votes rules
  6. Buyout and sale of shares rules

Get An EIN

You should also get an Employer Identification Number (EIN) because you may need to hire personnel for your business. 

Every employer in the United States is required to have this number. You can quickly get the number for your LLC at the IRS website.

The Forms You Need To Register An LLC In Maryland

You only need a single form (Articles of Organization) to register your LLC in Maryland. The form is readily available at the Maryland Departmental Forms & Applications

You can fill out the form online and file it without downloading it. If you are not ready with all the requirements, you should prepare them in advance to ease the filling process. You can also download the form if you want.

Did You Know?
Maryland is one of the states with the fewest requirements to register an LLC. You can easily breeze through forming an LLC in Maryland in a few minutes. Maryland has over 300,000 registered LLCs mainly because of their ease of registering, liability protections, flexible tax laws, and friendly management policies.LLCs only became a business structure in Maryland in 1991. However, it has become a prevalent form of business.

LLC Taxes In Maryland

Maryland LLC taxes are very friendly. The taxes are not only lenient, but they are also flexible. So, how much do LLCs have to pay in taxes in Maryland? The taxes are divided into two categories.

  • State taxes. These are taxes remitted to the state by the LLC. Generally, LLCs are not charged taxes by the state. However, the LLC can set taxes as a corporate entity. This applies when there are members who are not residents of the state. The corporate tax rate is 8.2% for LLCs eligible to pay.
  • The IRS levies federal taxes. Unless an LLC fills IRS form 8832 and elects to be treated as a corporation, it will not be eligible to pay tax. However, the individual members will be required to pay taxes independently. The corporate tax is levied at 21%. These returns are filed once every year. For more information, you can visit the IRS website.
Corporate Tax Rate

Is Maryland a good place to start an LLC?

Given the difference in tax levels, Maryland is an excellent state to start an LLC. The taxes are comparatively lower in Maryland. Moreover, the process of creating an LLC in the state is straightforward. So, starting and running an LLC in Maryland is more accessible and less expensive.

How Long To Form An LLC In Maryland

The process of preparing all the documentation can take you a couple of days. You will need to create a name and conduct a name search. This can take 2 hours. 

You also need to research the applicable laws and write articles of association. This can take you a whole day. Once you have all these ready, you can start the filing process, which will take 2 hours. 

How Much Does It Cost To Run An LLC In Maryland?

The cost of running an LLC in Maryland depends on several factors. You will need $100 to register the LLC and a $300 annual renewal fee. 1. 

Once you know how much to start an LLC in Maryland, there are other factors to consider. They include the location, the LLC’s size, and the business’s nature. 

Considering all these factors, you will determine how much your operations will cost.

What To Do After Formation?

Creating an LLC in Maryland is just the beginning. After that, you need to run the organization to ensure it succeeds. There are some things you must do to ensure this success.

  • Create a logo. This will act as the symbol of your business. Businesses are recognized by their name and also by their logo. It is important to create a logo that is as unique as possible.
  • Build a website/eCommerce store. Ensure that you have a website for your business. It will facilitate finding some of your customers and present an opportunity to explain more about your business. If you are doing e-commerce, your website can also be a shop.
  • Bank account. You will need to receive and pay out money for your business operations. A bank account is therefore compulsory to carry out your business. Moreover, you may need to get a loan or overdraft constantly. The bank account will enable financial institutions to assess your viability for financial assistance.
  • Business insurance. Ensure your business covers you in case of any unforeseen disasters that may happen. Insurance will help get you back if you undergo such problems.
  • Annual reports. Always file your yearly accounts and clear any taxes. This will enable your LLC to operate without unnecessary hitches.

You should take these steps to ensure that the business runs successfully. If you don’t, you will soon run into operational problems.

Resources To Start A Successful LLC In Maryland

To start an LLC in Maryland, you can visit the following sites to get the resources you need.

Start Marketing Your LLC In Maryland

It would be best if you aggressively marketed your LLC in Maryland to attain success. A new business can market in the following ways.

  • Reach your friends and acquaintances by word of mouth to tell them about your business and what it offers.
  • Social media networks. Try to reach as many people as possible through social media networks like Facebook, Twitter, and Instagram, among others. Inform them about your business and what it offers.
  • Organize advertisement campaigns using extensive ad networks such as Google.

How To Dissolve An LLC In Maryland

To dissolve your LLC in Maryland, you need to follow three simple steps:

a) Follow your LLC operating agreement for dissolution rules.

b) Close the tax accounts of your business.

c) File Articles of Cancellation.

Once you take these steps, your company will cease to exist.

Conclusion

Creating an LLC in Maryland is easier than you may think. Once you have all the prerequisites, you will be well on your way. 

The requirements include a name and articles of organization. Ensure you have $100 for the registration fee. You can then proceed to register your LLC online within a few hours. 

After that, you can begin operating your LLC. Create a good marketing plan to get the business running. At the end of the year, you should remember to file returns to ensure that you don’t have problems with the regulating authorities.

Frequently Asked Questions (FAQ)

Provided you have all your requirements ready, it only takes a few minutes to register an LLC online in Maryland. You will need to pay the requisite fee, about $100, plus any other charges to speed up the process. These payments can also be made online. The whole process should not take more than 1 hour.

LLCs are not taxed in Maryland. It is the members who pay tax individually. However, if members are not Maryland residents, then the LLC will have to pay tax on their behalf. Otherwise, it is the responsibility of the members to file their tax returns with the IRS.

Yes, you must file returns yearly for your LLC in Maryland. This is a requirement for all registered business entities in the state and other parts of the United States. Once you file these returns, you will have automatically renewed your LLC.

The business license you will be given lasts for a year. The duration runs from May 1st to April 30th. Once the license expires, you will need to get a new one for the subsequent year. You should always renew your license promptly to avoid problems with the authorities.

The fees for Maryland annual reports range from $100 to $175 per state plus filing fees. It doesn't take a long time to file an annual report in Maryland. At most, it will take you a couple of hours if you have all the requirements ready. The process can be done online, so you don't have to go physically if you don't want to.

Matija Kolaric

Amazing content is the core of what we do. With more than 5 years of experience in branding, name development, and business, Matija helps create and manage content production.

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