Maryland LLC Costs
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A limited liability company, or LLC, provides business owners with liability protection, unique tax breaks, and a management structure that is flexible. Business owners often think the LLC formation process in Maryland is costly and overly complicated. However, it is a straightforward process worth investing in for some companies.
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Costs to start an LLC in Maryland
1
LLC Articles of Organization ($100)
- You must file your Articles of Organization with the Maryland Department of Assessment and Taxation.
- The LLC costs for your Maryland LLC Articles of Organization is $100.
- Maryland does offer expedited services for mail filings for an additional $50.
2
Maryland annual report fee ($300)
- Your LLC must file an annual report and pay your yearly franchise tax of $300 to the Maryland Secretary of State.
- You can file your annual report fee online using the Maryland Business Express website.
- Or, you can complete the annual report form and submit it by mail to the Maryland Secretary of State.
- Your annual fee is due April 15th every year. The state of Maryland charges a penalty of 1/10 of 1% of the county assessment and 2% interest every 30 days that the fees are late.
3
Maryland registered agent fee (varies between $50 to $300)
- In Maryland, you must appoint a registered agent when forming an LLC.
- Obtaining a registering agent helps to ensure the state of Maryland that someone is available to receive phone calls, tax notices, and other government correspondence.
- The cost of a registered agent will vary depending on the service, the LLC’s business needs, and state fees.
- You can act as your own registered agent in Maryland. However, professionals advise you to appoint an experienced agent or service to avoid late fees and deadlines.
4
Fees to form a foreign LLC in Maryland ($100)
- You must register an LLC as a foreign LLC if you have an existing one in another state.
- The cost to form a foreign LLC in Maryland is $100.
- You will complete the Foreign LLC Registration online.
- Or, you can complete the Foreign Limited liability Company Registration form and submit it to the Maryland Secretary of State.
5
LLC name reservation fee ($25)
- Maryland does not require that you reserve an LLC name.
- Reserving an LLC name in Maryland ensures that no one can obtain the same company name before you finish forming your LLC.
- You can reserve your Maryland LLC name for up to 30 days prior to formation.
- You must renew your name reservation if you wish to maintain the LLC name past 30 days.
- You will complete the Corporate Name Reservation Application and submit it to the Maryland State Department of Assessments and Taxation to reserve an LLC name.
- The cost for a Maryland LLC name reservation and renewal is $25.
6
DBA filing fees in Maryland ($25)
- The abbreviation DBA stands for ‘doing business as.’ A DBA, or assumed name, is any registered name a person or LLC uses to do business that is not the legal name.
- You must register your DBA if you are using a business name that is not the company’s legal name.
- You can file a trade name application online through the Maryland Business Express portal.
- Or, you can complete the Trade Name Application and submit it by mail or in person to the Department of Assessments and Taxation.
- The cost to file your Maryland DBA is $25.
7
Cost of certified document copies ($20)
- You will order your Maryland certified document copies through the Maryland business Express portal.
- The cost for certified documents in Maryland is $20 for the first page and an additional $1 per page.
8
Certificate of Status ($20 online)
- Financial institutions and banks require a Certificate of Status when you open a new business banking account.
- You can use the Maryland Business Express website to order your Certificate of Status.
- Or, you can visit the Maryland Department of Assessments and Taxation website for instructions on how to file by paper.
- The LLC filing fee for your Certificate of Status is $20 online and $40 by mail or in person.
Steps to start an LLC in Maryland
1
Choose a business name
When choosing an LLC name in Maryland, you will want to consider a few things.
- Your LLC name must be unique and available in Maryland.
- The business name must meet Maryland name requirements and restrictions.
- The recommendation is to check for web domain availability to keep branding simple.
You will use the Maryland Business Entity Search to conduct a name check for the availability of an LLC name.
LLC name reservation fee
The state of Maryland does not mandate that you reserve an LLC before formation.
LLC name reservation is good for up to 30 days and must be renewed.
You must complete the Maryland Corporation Name Reservation Application and submit it to the State Department of Assessments and Taxation.
The cost for a name reservation in Maryland is $25.
The cost for reserving a Maryland LLC name is $25, and is good for up to 30 days. Maryland does not require you to reserve a company name.
2
Appoint a Maryland registered agent
The Maryland Secretary of State requires that you appoint a registered agent when forming an LLC in the state.
The price for a Maryland registered agent or service varies beetween $50 and $100 a year. The cost depends on the state and your LLC needs.
A registered agent in Maryland is an individual or business entity that receives tax forms, legal documents, subpoenas, civil notices, service of process, and other official government correspondence on behalf of a sole proprietorship, corporation, or LLC.
The registered agent you choose must be a Maryland resident or a registered agent service authorized to conduct business in the state.
ZenBusiness
- Starter Plan – $39 a year plus State Fees
- Pro Plan – $149 a year plus State Fees
- Premium Plan – $249 a year plus State Fees
ZenBusiness offers a stand-alone registered agent service. The price is $99 per year.
Northwest
- Total Out The Door Maryland LLC Formation Service Package – $50 a month and includes:
- Maryland State Fee
- Filing Service Fee
- Registered Agent
- Tax ID
- Annual Plan – $225 plus State Fees a year
LegalZoom
- Economy – $79 plus $153 Maryland filing fees
- Standard – $329 plus $153 state filing fees
- Express Gold – $349 plus $255 state filing fees
3
File Maryland Articles of Organization
Your LLC Articles of Organization, or Certificate of Formation, is a document you file with the Maryland Department of Assessment and Taxation when forming an LLC.
You can submit your Articles of Organization online using the Maryland Business Express or by completing the Articles of Organization form and submitting it by mail.
The filing costs for your Articles of Organization in Maryland are $100.
Mailing address:
Maryland Department of Assessments and Taxation
301 W. Preston St.
Baltimore, MD 21201
The Articles of Organization form ask for specific information about your Maryland LLC.
- LLC name and address
- Purpose of your LLC
- Registered agent information
The fee in Maryland for filing your LLC Articles of Organization is $100.
4
Get a Maryland LLC EIN
An Employer Identification Number, or EIN, can also be referred to as a Federal Employer Identification Number (FEIN) or Federal Tax ID Number (FTIN).
The IRS, or Internal Revenue Service, will assign you an EIN free once you apply. The 9-digit number acts as a Social Security Number for LLCs for income tax purposes.
In Maryland, the IRS mandates that you get an IEN if you convert a business from a sole proprietorship to an LLC.
Applying for an EIN is a simple process online through the IRS website.
Business banking for a Maryland LLC
Your business banking account and personal banking account should always be separate. It ensures that your private assets and credit scores are protected.
In Maryland, banking institutions require your Articles of Organization, an operating agreement, and the assigned EIN before you conduct business banking.
Business banking accounts are generally free, and do not have additional charges or fees.
Business attorney fees in Maryland
A business attorney is helpful when forming LLCs because it helps make the formation process straightforward and will help you handle future business-related issues.
Typically, business attorneys will offer first-time clients free consultations upon request.
Professional services such as LegalZoom and Rocket Lawyer offer LLC formation packages that include comprehensive legal services.
On average, a business lawyer in Maryland will cost $300 per hour.
LLC taxes in Maryland
- In Maryland, your LLC is considered a pass-through entity, meaning members file personal tax returns instead of the LLC’s state tax return.
- You must obtain a seller’s permit through the Comptroller of Maryland if you plan on selling physical products and services.
- The Maryland state sales tax rate is 6.00%. The state has no maximum tax rate for county and local taxes.
- If you hire employees in Maryland, you must register for Unemployment Insurance Tax through the Maryland Department of Labor, Licensing and Regulation.
- You will use the Comptroller of Maryland website to register for Employee Withholding Tax.
- Maryland state taxes and federal are complicated, which makes hiring a professional worthwhile for many LLCs.
Business licenses and permits in Maryland
The business licenses and permits you will need will depend on where the business is in Maryland and the type of business it is.
You will use the Maryland Business Express Website to search for and obtain the specific business license you need.
A business license in Maryland varies between $80 and $800. The cost will depend on the type of business it is and where it is located.
Maryland counties and towns will have different requirements and rules for licenses and permits. It is always a good idea to call the head and ask about the process, price, and business hours.
Notary public
In Maryland, you may find some of your LLC formation documents require a notarization from the notary public.
If you cannot find a notary on your own, most government offices have at least one on staff.
Per Maryland law, a notary public can only charge a max of $4 per notorial act.
Employer obligations in Maryland
- When you hire employees in Maryland, you have specific employee obligations.
- The federal government requires a business to verify all employees are eligible to work in the United States. You will file Form I-9 from the USCIS Website.
- Maryland requires you to obtain worker’s compensation insurance.
- You must report all new hires using the Maryland State Directory of New Hires.
- You can find a complete list of employer obligations in Maryland.
Benefits of a Maryland LLC
- Forming an LLC in Maryland makes business banking easier. Financial institutions and leaders require business owners to open a bank account separate from their personal banking account. The business structure reduces your personal liability.
- You have different complicate requirements when you form an LLC. Incorporations have stockholders and shareholders that they answer to anytime they make business decisions. LLCs in Maryland do not have the same requirements.
- In Maryland, LLCs are considered pass-through entities. Your business earnings are only taxed once through a member’s tax returns.
- You help to avoid double taxation when you form an LLC in Maryland. Other business structures such as C-corporations are taxed twice. LLCs are not.
FAQs
How long does it take to register an LLC in Maryland?
LLC registration in Maryland takes 5 to 7 days if you file online and 4 to 6 weeks if you file by mail.
If you file by mail, Maryland does offer expedited services for an additional $50.
How do I dissolve my Maryland LLC?
You must file your Articles of Cancellation with the Maryland Department of Assessments. You can file online or complete the Articles of Cancellation form and submit it by mail.
The Maryland filing fee for your LLC cancellation is $100.
Do I need a business operating agreement for my LLC in Maryland?
Maryland law does not require you to create or file an LLC operating agreement.
However, a lot of LLCs opt to have one file. An operating agreement can be verbal or written and helps minimize future issues with management and finances.
Are there publication requirements for an LLC in Maryland?
Unlike Arizona, Maryland has no publication requirements for LLCs. Instead, you file an annual report with the state.
Publishing a notice of your business is always a good idea. It helps new LLCs, small businesses, and entrepreneurs introduce themselves to the public.
Does Maryland have an annual franchise tax?
Maryland does not have an annual or biennial franchise tax or privilege tax.
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