To form a corporation in Maryland, you need to take the steps set forth below. You can also use Nolo's Online Corporation service, which will form a corporation for you with everything you need.
Your corporation's name must contain one or more of the following words (or an abbreviation thereof): "Incorporated," "Corporation," or "Limited."
Your corporation's name must be recognizably different from the names of other business entities already on file with the Maryland Department of Assessments and Taxation. Names may be checked for availability by searching the Maryland business name database. You may reserve a name for 30 days by filing an Application for Reservation of Name with the Secretary of State. The reservation must be filed by mail.
Your corporation is legally created by filing Articles of Incorporation for a Stock Corporation with the Maryland Department of Assessments and Taxation. The articles must include: the name and address of the incorporator; the corporate name; its purpose; the street address of the principal place of business in Maryland; the name and street address of agent for service of process; the number of shares the corporation is authorized to issue and the par value; the number and names of the initial directors; and the consent of the resident agent.
The articles may be filed online or by mail. The basic filing fee is $100 plus a $20 organization and capitalization fee for a total of $120, unless the aggregate par value of the stock exceeds $100,000 or, if no par value stock is used, the corporation has authority to issue more than 5,000 shares. If stock exceeds these amounts, call 410-767-1340 for the fee. There is an additional $50 expedited fee and 3% service fee for online filings.
Every Maryland corporation must have an agent for service of process in the state. This is an individual or corporation that agrees to accept legal papers on the corporation's behalf if it is sued. The agent must be either an adult citizen of Maryland or another existing Maryland corporation. The registered agent must have a physical street address in Maryland. The agent should agree to accept service of process on your corporation's behalf prior to designation.
Bylaws are an internal corporate document that set out the basic ground rules for operating your corporation. They are not filed with the state. Your corporation is not legally required to have corporate bylaws, but you should adopt them because they (1) establish your corporation's operating rules, and (2) help show banks, creditors, the IRS, and others that your corporation is legitimate. For corporate bylaw forms, see Nolo's website or Incorporate Your Business, by Anthony Mancuso (Nolo). Corporate kits also typically contain sample bylaws.
The incorporator—the person who signed the articles—must appoint the initial corporate directors who will serve on the board until the first annual meeting of shareholders (when the board members who will serve for the next term are elected by the shareholders). The incorporator must fill in an "Incorporator's Statement" showing the names and addresses of the initial directors. The incorporator must sign the statement and place a copy in the corporate records book. The statement need not be filed with the state. For a sample Incorporator's Statement, see Incorporate Your Business, by Anthony Mancuso (Nolo).
At the first board meeting, the directors appoint corporate officers, adopt bylaws, select a corporate bank, set the corporation's fiscal year, authorize issuance of shares of stock, and adopt an official stock certificate form and corporate seal. Share issuances by small privately held corporations are usually exempt from federal and state securities laws--see the Nolo Corporations FAQ.
Record the directors' actions in corporate minutes prepared by the incorporator or any of the directors. For corporate meeting minute forms, see Nolo's website or refer to Incorporate Your Business, by Anthony Mancuso (Nolo).
All corporations doing business in Maryland must file an Annual Report with the Maryland Department of Assessments and Taxation Personal Property Division. The report is due by April 15 each year and the annual filing fee is $300 (the fee does not include any state tax liability of the corporation).
If your business owns, leases, or uses personal property in Maryland or has a trader's license with a local government unit, you must also file a Personal Property Tax Return. Both reports can be filed online or by mail.
Your corporation must obtain a federal employer identification number (EIN). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.