What Is an LLC in Maryland?
A limited liability company organized in Maryland is a flexible business entity that combines personal asset protection for its owners with the management simplicity of a partnership. The entity is governed by the Maryland Limited Liability Company Act (Md. Code, Corps. & Ass’ns §§ 4A-101 through 4A-1103), which authorizes any person to form an LLC by filing articles of organization with the State Department of Assessments and Taxation.
Members of a Maryland LLC are shielded from personal liability for the company’s obligations. Under Md. Code, Corps. & Ass’ns § 4A-301, “no member shall be personally liable for the obligations of the limited liability company, whether arising in contract, tort, or otherwise, solely by reason of being a member.” By default, every member acts as an agent of the LLC and may bind it in the ordinary course of business (Md. Code, Corps. & Ass’ns § 4A-401). A single-member LLC is treated as a disregarded entity for federal tax purposes, and a multi-member LLC is taxed as a partnership, unless the members elect corporate classification through IRS Form 8832. Maryland imposes no entity-level franchise tax or gross receipts tax on LLCs that retain pass-through status, though the LLC must file an annual report with SDAT each year, and members report their share of income on Maryland individual returns.
Maryland LLC Name Search
The name of a Maryland LLC must be distinguishable from the records of the State Department of Assessments and Taxation from the name of every other entity organized or authorized to do business in the state. Md. Code, Corps. & Ass’ns § 1-504 establishes this standard, and Md. Code, Corps. & Ass’ns § 1-502 specifies the designators that must appear in every LLC name: “Limited Liability Company,” “L.L.C.,” “LLC,” “L.C.,” or “LC.” An entity name may not contain language implying the LLC is organized for a purpose other than what its articles of organization allow (Md. Code, Corps. & Ass’ns § 1-503). Words such as “bank,” “trust,” “savings,” and “insurance” are restricted and generally require approval from the relevant regulatory authority before SDAT will accept them in a formation filing.
An organizer can check name availability using the Maryland Business Express Business Entity Search. This tool compares the proposed name against all existing entities on file. A clear result, however, is not a guarantee—SDAT makes the final determination when it reviews the articles of organization.
Name Reservation: To hold a name before filing, an organizer may submit the Corporate Name Reservation Application to SDAT with a $25.00 fee. Under Md. Code, Corps. & Ass’ns § 1-505, SDAT reserves the name for 30 days. The reservation is transferable to another person but cannot be renewed; once the 30-day period expires, the name becomes available again.
Choosing an LLC Registered Agent in Maryland
Maryland uses the term resident agent rather than “registered agent,” but the role is the same: the resident agent accepts service of process and official correspondence on behalf of the LLC. Under Md. Code, Corps. & Ass’ns § 4A-210, every domestic LLC must maintain both a principal office in the state and a resident agent.
The Maryland Business Express registration page identifies four categories of eligible resident agents: an adult citizen of Maryland, a Maryland corporation, a Maryland LLC, or a Maryland limited partnership or LLLP. The LLC itself cannot serve as its own resident agent. The principal office must be a real street address in Maryland; a P.O. Box, UPS store, or virtual office address is not acceptable, and using one can result in rejection of the filing.
The resident agent’s name and address are required fields in the articles of organization. If the LLC needs to change its resident agent after formation, it files a statement signed by an authorized person with SDAT and pays a $25.00 fee per entity. A resident agent who wishes to resign may file a signed resignation with SDAT; unless the LLC has already appointed a successor, the resignation becomes effective 10 days after filing (Md. Code, Corps. & Ass’ns § 4A-210(d)). An LLC that fails to maintain a resident agent risks falling out of good standing and losing the ability to conduct business or maintain lawsuits in Maryland courts.
LLC Filing Requirements in Maryland
An LLC is formed in Maryland when the State Department of Assessments and Taxation accepts its articles of organization for recording, or, if the organizer elects a delayed effective date, on a later date specified in the document. Md. Code, Corps. & Ass’ns § 4A-202 permits any person to form an LLC by causing articles of organization to be executed and filed for record with SDAT. The base filing fee is $100.00, as set by the SDAT fee schedule, plus a $20.00 organization and capitalization fee.
Under Md. Code, Corps. & Ass’ns § 4A-204, the articles of organization must set forth:
- The name of the LLC, including a required designator
- The address of the LLC’s principal office in Maryland and the name and address of its resident agent
- Any other provisions the members elect to include, such as a statement limiting the authority of members to bind the LLC solely by virtue of being members
The formation filing can be submitted in two ways:
- Online: File through Maryland Business Express, SDAT’s online portal for business formation. Online filings include a 3% service/convenience fee on electronic payments. Expedited review online (7 to 10 business days) costs an additional $50.00. Same-day rush service online (submitted by 2:30 p.m.) costs an additional $325.00.
- By Mail: Send the completed articles and filing fee (check or money order payable to SDAT) to the State Department of Assessments and Taxation, Corporate Charter Division, 700 E. Pratt Street, Suite 2700, Baltimore, MD 21202-6377. Non-expedited mail filings take approximately 4 to 6 weeks to review. Expedited paper filing (7 to 10 business days) adds $50.00; same-day paper rush adds $425.00.
Note: Maryland requires every LLC to file an annual report and, when applicable, a personal property tax return by April 15 each year. The annual report fee is $300.00 for domestic LLCs. The first report is due by April 15 of the year following the calendar year in which the LLC was formed, and it may be filed online through Maryland Business Express.
How Much Does it Cost to Create an LLC in Maryland?
| Cost | Mandatory or Optional | Amount | When It Applies | Official Source |
| Articles of Organization (base filing fee + organization & capitalization fee) | Mandatory | $100.00 + $20.00 = $120.00 | At formation | SDAT Fee Schedule for Charter Services |
| Name Reservation | Optional | $25.00 | Before formation, to hold a name for 30 days | Corporate Name Reservation Application |
| Expedited Processing (7–10 business days) | Optional | $50.00 (in addition to the filing fee) | At filing, if a faster review is requested | SDAT Fee Schedule for Charter Services |
| Same-Day Rush (online, by 2:30 p.m.) | Optional | $325.00 (in addition to the filing fee) | At filing, if same day review is requested online | SDAT Fee Schedule for Charter Services |
| Same-Day Rush (paper, by 10:00 a.m.) | Optional | $425.00 (in addition to the filing fee) | At filing, if same day review is requested by paper | SDAT Fee Schedule for Charter Services |
| Online Convenience/Service Fee | Conditional | 3% of the payment amount | When filing electronically through Maryland Business Express | SDAT Forms & Applications |
| Annual Report — Domestic LLC | Mandatory | $300.00 | By April 15 of the year after formation, then annually | Maryland Business Express — Good Standing |
| Certificate of Good Standing | Optional | $20.00 | When proof of good standing is needed | SDAT Fee Schedule for Charter Services |
| Federal EIN | Mandatory (if employees or elected corporate classification) / Recommended otherwise | $0 | After formation | IRS—Get an Employer Identification Number |
LLC Operating Agreement in Maryland
Maryland law does not require an LLC to adopt an operating agreement, but it expressly authorizes one and provides a robust statutory framework for it. Under Md. Code, Corps. & Ass’ns § 4A-402, “members may enter into an operating agreement not inconsistent with the articles of organization to regulate or establish any aspect of the affairs of the limited liability company, the conduct of its business, or the relations of its members.” The initial operating agreement requires the consent of all persons who are then members. Unless the articles of organization specifically require otherwise, the operating agreement need not be in writing—it is never filed with SDAT.
The statute enumerates a broad range of matters the operating agreement may address: management and control structure, including the authority to delegate management to non-members; profit and asset sharing among members; restrictions or procedures for assigning membership interests; conditions for admitting new members; voting rights, quorum requirements, and proxy voting; and procedures for amending the agreement itself. The operating agreement binds every person who is or becomes a member or assignee, whether or not they signed it (Md. Code, Corps. & Ass’ns § 4A-402(d)(5)).
Without an operating agreement, statutory defaults govern. Decisions on ordinary business matters require the consent of members holding a majority of the interests in profits, as allocated in proportion to capital contribution values (Md. Code, Corps. & Ass’ns § 4A-403 and § 4A-503). Disposing of substantially all the LLC’s property or approving a merger requires a two-thirds vote. Actions like filing for bankruptcy or altering profit allocations require unanimous consent. Only a member’s economic interest is transferable, and the transferee does not become a member unless separately admitted (Md. Code, Corps. & Ass’ns § 4A-603).
A sole-member LLC benefits from a written operating agreement as well, because it documents the separation between the member and the entity—a factor courts may consider when evaluating whether the liability shield should be respected.
How to Get an EIN for an LLC in Maryland
A federal Employer Identification Number is a nine-digit number the Internal Revenue Service assigns to identify a business entity for tax purposes. Every LLC that has employees, elects corporate tax classification, or withholds taxes on income paid to a nonresident alien must obtain an EIN. A single-member LLC with no employees is not required to have one, but most financial institutions will not open a business account without it, and obtaining one avoids the need to use the sole member’s Social Security number on business forms.
The IRS EIN Online Application is the fastest method the number is issued at the end of the session. The tool is available Monday through Friday, 7:00 a.m. to 10:00 p.m. Eastern Time, and requires a valid Taxpayer Identification Number (SSN or ITIN) for the responsible party. The responsible party is the individual who owns, controls, or directs the LLC and its funds and assets; for a single-member LLC, this is typically the sole member.
An applicant may also complete IRS Form SS-4 and submit it by fax (approximately four business days for a response) or by mail (approximately four to five weeks). There is no charge for an EIN regardless of application method.
Note: The IRS online EIN application is accessible only during the hours listed above. Requests submitted outside those hours will not be processed until the next available window.
Registering for State Taxes in Maryland
Maryland imposes a personal income tax on its residents and on nonresidents with Maryland-source income, but the state does not levy a separate entity-level tax on LLCs that retain default pass-through classification. Each member reports the member’s distributive share of the LLC’s income on an individual Maryland return. An LLC that elects C-corporation status through IRS Form 8832 becomes subject to Maryland’s corporate income tax, which has a flat rate of 8.25%.
If the LLC sells tangible personal property or taxable services in Maryland, it must obtain a sales and use tax license. Maryland’s general sales tax rate is 6%. The LLC registers for sales tax, employer withholding, and other state tax accounts through the Comptroller’s Combined Registration Application or through Maryland Tax Connect. The CRA is a single application that covers the sales and use tax license, employer’s withholding tax account, admissions and amusement tax account, tire recycling fee account, and transient vendor license — whichever accounts apply to the LLC’s operations.
| Tax Type | Agency | Registration Method | Fee |
| Individual Income Tax (member-level) | Comptroller of Maryland | Members file Form 502/505 individually | — |
| Sales and Use Tax License | Comptroller of Maryland | Combined Registration Application or Maryland Tax Connect | $0 |
| Employer Withholding Tax | Comptroller of Maryland | Combined Registration Application or Maryland Tax Connect | $0 |
| Annual Report (SDAT) | State Department of Assessments and Taxation | Maryland Business Express | $300.00 |
Registering as an Employer in Maryland
An LLC that hires employees in Maryland must establish accounts for unemployment insurance, state income tax withholding, and workers’ compensation insurance before or promptly after the first employee begins work.
Unemployment Insurance: The Maryland Department of Labor, Division of Unemployment Insurance, administers the state’s unemployment insurance program. An employer with one or more employees must register for an employer account through the BEACON Employer Portal by selecting “Register an Account” and following the prompts. Employers report quarterly wages and pay unemployment insurance taxes through the same portal.
Income Tax Withholding: Because Maryland levies a personal income tax, every employer must register to withhold state and local income tax from employee wages. This registration is completed through the Comptroller’s Combined Registration Application or through Maryland Tax Connect. The employer files quarterly withholding returns and remits withheld amounts to the Comptroller.
Workers’ Compensation Insurance: Maryland law requires virtually all employers with one or more employees to carry workers’ compensation insurance. Coverage is obtained through a licensed private insurance carrier or through a self-insured group. The Maryland Workers’ Compensation Commission oversees compliance and provides a coverage verification tool.
New Hire Reporting: Maryland law requires employers to report newly hired or rehired employees within 20 days of the hire date. Reports are submitted electronically to the Maryland Department of Human Services through the Maryland State Directory of New Hires.
| Obligation | Agency | Registration Method |
| Unemployment Insurance | Maryland Department of Labor | BEACON Employer Portal — Register an Account |
| State Income Tax Withholding | Comptroller of Maryland | Combined Registration Application or Maryland Tax Connect |
| Workers’ Compensation Insurance | Licensed private carrier / Maryland WCC | Obtain policy from licensed insurer; verify coverage at Maryland WCC |
| New Hire Reporting | Maryland Department of Human Services | Maryland State Directory of New Hires |
The LLC must also fulfill federal employer obligations, including filing IRS Form 941 (Employer’s Quarterly Federal Tax Return), paying FUTA taxes under the Federal Unemployment Tax Act, and completing Form I-9 (Employment Eligibility Verification) for each new hire.