As you are planning to start an LLC in Maryland, there are essential steps to take to successfully form your LLC.
To make starting an LLC easier for you, go through this guide on how to start an LLC in Maryland.
So this article will expose you to the simple steps on how to start an LLC in Maryland and what LLC formation in the United States requires.
How to start an LLC in Maryland.
Here are the steps you need to take to form an LLC in Maryland:
- Choose a Name for Your LLC
- Appoint a Registered Agent
- File Articles of Organization
- Prepare an Operating Agreement
- Comply With Other Tax and Regulatory Requirements
- File Annual Reports
Choose a Name for Your LLC
According to 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.’
Also, your LLC’s name must not be similar to the names of other business entities already on file with the Maryland Department of Assessments and Taxation.
However, you may check for the availability of the name by searching the Maryland business name database.
In addition, you can carry out any business transaction with your tradename known as (DBA)
With this, you don’t have to use your LLC’s official legal name registered in your articles of the organisation when you do business out in the real world.
Meanwhile, you can register a trading name with the Maryland Department of Assessments and Taxation by filing a Trade Name Application.
The filing fee is $25 or $75 for expedited service. However, registration is not mandatory but is recommended.
Appoint a Registered Agent
Your LLC in Maryland must have an agent for service of process in the state. These agents are called registered agents in Maryland.
This Individual,s or business agrees to accept legal papers on the LLC’s behalf if it is sued.
However, a registered agent may be any Maryland citizen over eighteen, a Maryland corporation, or a Maryland LLC.
Meanwhile, the registered agent must have a physical street address in Maryland.
File Articles of Organization
All Maryland LLCs are required to file Articles of Organization with the Maryland Department of Assessments and Taxation.
The articles of organisation must include:
- the LLC’s name
- the LLC’s purpose
- the LLC’s address in Maryland; and
- the name, address, and signature of the LLC’s registered agent in Maryland.
These articles may be filed by mail or online.
The filing fee is $100, and an additional $50 expedited fee and 3% service fee are charged for online filings).
Prepare an Operating Agreement
An operating agreement is not required for LLCs in Maryland but is highly advisable.
An operating agreement is an internal document that establishes how your LLC will be run.
It is not filed with the state and sets out the members’ and managers’ rights and responsibilities, including how the LLC will be managed.
Also, it can help preserve your limited liability by showing that your LLC is indeed a separate business entity.
However, the state LLC law will govern how your LLC operates in the absence of an operating agreement,
More so, the operating agreement should include the following:
- the members’ percentage interests in the LLC
- the members’ rights and responsibilities
- the members’ voting powers
- how profits and losses will be allocated
- rules for holding meetings and taking votes, and
- buyout, or buy-sell, provisions determine what happens when a member wants to sell his or her interest, dies, or becomes disabled.
Comply With Other Tax and Regulatory Requirements
Your Maryland LLC may require additional tax and regulatory requirements, which may include:
Employer’s Identification Number (EIN): A must to obtain an EIN with the IRS if your LLC has more than one member, even if it has no employees yet.
Also, you may need an Employer Identification Number (EIN) if you form a one-member LLC.
Meanwhile, you may obtain an EIN by completing an online application on the IRS website with no filing fee.
Business Licenses: Depending on its type of business and location, your LLC in Maryland may need to obtain other local and state business licenses.
Comptroller of Maryland: If you have employees or will be selling goods and collecting sales tax, you’ll need to register with the Comptroller of Maryland.
You can register for some state tax purposes online, but other registrations (such as for sales tax) must be done on paper.
File Annual Reports
All LLCs in Maryland must file an Annual Report and Personal Tax Return with the Maryland Department of Assessments and Taxation Personal Property Division.
However, the report and return may be filed electronically through Maryland Business Express (MBE) or by mail.
Furthermore, it is due by April 15 each year.
The annual filing fee is $300, and the fee does not include any state tax liability of the LLC.
The first step to take on how to start an LLC in Maryland is to do a name search and reserve your name.
However, you must note that the name you choose for your LLC must not have been used by another business and ensure that the domain name is also available.
Also, you have to choose a registered agent, file an article of organisation, prepare an operating agreement and file an annual report.
In addition, you must comply with all the additional tax and regulatory requirements.
We hope you find this guide on how to start an LLC in Maryland helpful.
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How to start an LLC in other states of the United States
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