Frequently asked questions about starting and running an LLC, or limited liability company.
Under Maryland law, an LLC name must contain one of the following: "limited liability company" or the abbreviation "L.L.C.," "LLC," "L.C.," or "LC.'
Your LLC's name must not be misleadingly similar to 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.
Every Maryland LLC must have an agent for service of process in the state (called a resident agent in Maryland). This is an individual or business entity that agrees to accept legal papers on the LLC's behalf if it is sued. A registered agent may be any Maryland citizen who is over eighteen, a Maryland corporation, or a Maryland LLC. The registered agent must have a physical street address in Maryland.
A Maryland LLC is created by filing Articles of Organization with the Maryland Department of Assessments and Taxation. The articles must include:
The articles may be filed by mail or online. The basic filing fee is $100 (an additional $50 expedited fee and 3% service fee is charged for online filings).
An LLC operating agreement is not required in Maryland, but is highly advisable. This is an internal document that establishes how your LLC will be run. It is not filed with the state. It sets out the rights and responsibilities of the members and managers, including how the LLC will be managed. It can also help preserve your limited liability by showing that your LLC is truly a separate business entity. In the absence of an operating agreement, state LLC law will govern how your LLC operates.
The operating agreement should include the following:
Additional tax and regulatory requirements may apply to your LLC. These may include:
EIN: If your LLC has more than one member, it must obtain its own IRS Employer Identification Number (EIN), even if it has no employees. If you form a one-member LLC, you must obtain an EIN for it only if it will have employees or you elect to have it taxed as a corporation instead of a sole proprietorship (disregarded entity). You may obtain an EIN by completing an online application on the IRS website. There is no filing fee.
Business Licenses: Depending on its type of business and where it is located, your LLC may need to obtain other local and state business licenses.
Comptroller of Maryland: In some cases, for example if you have employees or will be selling goods and collecting sales tax, you'll need to register with Comptroller of Maryland. Currently, you can register for some state tax purposes online, but other registrations (such as for sales tax) must be done on paper. For more information on state LLC tax registration, see Nolo's article, Maryland LLC Annual Filing Requirements.
All LLCs doing business in Maryland must file an Annual Report and Personal Tax Return (Form 1) with the Maryland Department of Assessments and Taxation Personal Property Division. The report and return may be filed electronically through Maryland Business Express (MBE) or by mail. It is due by April 15 each year (you can request an extension). The annual filing fee is $300 (the fee does not include any state tax liability of the LLC).