LLC Cost in Maryland | How Much Does It Cost to Start an LLC

Steve Bennett
Business Formation Expert  |   Fact Checked by Editorial Team
Last updated: 
WebinarCare offers informative content for educational purposes only, not as a substitute for professional legal or tax advice. We may earn commissions if you use the services we recommend on this site.
WebinarCare is led by Steve Bennett, a seasoned expert in the business world. He's gathered a team that's passionate about giving you reliable advice on everything from starting a business to picking the right tools. We base our tips and guides on real-life experience, ensuring you get straightforward and proven advice. Our goal is to make your business journey smoother and more successful. When you choose WebinarCare, you're choosing a trustworthy guide for all things business.
LLC Costs in Maryland

Forming a Limited Liability Company (LLC) in Maryland is a popular choice for entrepreneurs and small business owners who want to protect their personal assets and enjoy flexibility in their business operations. LLC formation costs vary from state to state, and it is essential to understand the costs involved in forming and maintaining an LLC in Maryland.

If you would like to know more about the Maryland LLC Cost, read the whole article until the end. Webinarcare Editorial Team will help you gain knowledge on how much an LLC Costs in Maryland. You must be guided by all the factors gathered in this article.

How to Start an LLC?

Before we dive into the LLC Cost in Maryland, you should know the step-by-step process of starting an LLC, including selecting a unique business name, appointing a Resident Agent, filing the necessary documents, and fulfilling any additional requirements, such as obtaining licenses or permits that are specific to your industry or location.

Here are the steps in starting an LLC in Maryland:

  • Step 1: Choose a Unique Business Name
    The first step in starting an LLC in Maryland is to select a unique business name for your company. The name should be distinguishable from any other registered businesses in the state. You can check the availability of your desired business name by searching the state’s business name database. Once you’ve found an available name, you may need to include “LLC” or “Limited Liability Company” at the end of the name to comply with state requirements.
  • Step 2: Appoint a Resident Agent
    A Resident Agent is someone who will receive official legal and tax documents on behalf of your LLC. The Resident Agent must have a physical address in Maryland and be available during normal business hours. You have the option to appoint yourself as the registered agent or hire a professional registered agent service.
  • Step 3: File the Articles of Organization
    To officially form your LLC, you need to file the Articles of Organization with the Maryland Secretary of State or the appropriate state agency. The Articles of Organization typically requires basic information about your LLC, such as its name, address, Resident Agent details, and the name and address of the LLC’s members or managers.
  • Step 4: Create an Operating Agreement
    Once your LLC is formed, it’s highly recommended to create an operating agreement in Maryland. Although not required by Maryland law, an operating agreement is a crucial internal document that outlines the ownership, management, and operating procedures of your LLC. It helps establish clear guidelines and expectations among members, and it can be especially useful in the event of disputes or disagreements in the future. The operating agreement can be customized to fit the specific needs and goals of your LLC.
  • Step 5: Obtain Required Licenses and Permits
    Depending on the nature of your business, you may need to obtain specific licenses or permits at the federal, state, or local level. Research the licensing requirements in Maryland and apply for business licenses in Maryland related to your industry or activities. Common examples include professional licenses, health or safety permits, and sales tax permits.
  • Step 6: File for an Employer Identification Number (EIN)
    An Employer Identification Number (EIN) is a unique nine-digit number issued by the Internal Revenue Service (IRS) that is used to identify your LLC for tax purposes. Even if you don’t have employees, obtaining an EIN is typically required if you plan to open a business bank account, hire contractors, or file certain tax forms. You can easily apply for an EIN in Maryland through the IRS website.
  • Step 7: Comply with Ongoing Requirements
    Once your LLC is established in Maryland, it’s important to stay in compliance with any ongoing requirements. This may include filing periodic reports, paying Annual Report fees, and renewing licenses or permits. Familiarize yourself with the specific obligations for maintaining your LLC’s good standing in Maryland.

Remember, starting an LLC in Maryland involves some specific steps and requirements that may differ from other states. It’s advisable to hire an LLC Services in Maryland that specializes in business formation to ensure that you follow all the necessary procedures accurately and efficiently. We reviewed the Best LLC Services for you to check out.

LLC Cost in Maryland

It is crucial to consider the costs associated with the formation and maintenance of your business. The costs of establishing and operating an LLC in Maryland can vary based on several factors, including the initial formation fees, ongoing compliance requirements, and optional expenses.

Initial LLC Costs

When starting a limited liability company (LLC), knowing the initial costs associated with forming and registering your new business entity is essential. Understanding and preparing for these expenses can help you budget effectively and set your Maryland business on a path to success. Some common initial costs associated with forming an LLC include Articles of Organization filing fees, Resident Agent fees, and additional services, such as business name reservation fees.

Articles of Organization Filing Fee

The first step in forming an LLC in Maryland is to file the Maryland Articles of Organization with the Maryland Secretary of State. This document officially creates the LLC and includes essential information about the business, such as its name, address, and Resident Agent.

This document includes essential information about your LLC, such as:

  • The name of your LLC
  • The address of your LLC’s principal office
  • The name and address of your Resident Agent
  • The purpose of your LLC (optional in some states)

You can typically file the Articles of Organization online, by mail, or in person. A filing fee is associated with this process, which costs around $100. You can also file by mailing it to Maryland Secretary of State, which is located at CoState Department of Assessments and Taxation, Charter Division 301 W. Preston Street; 8th Floor, Baltimore, MD 21201-2395.

Recommended: Filing formation papers is easy and hassle-free if you hire a professional service. We recommend using –

LegalZoom ($0 + State Fee)

Resident Agent Fee

An LLC in Maryland must designate a Resident Agent who will be responsible for receiving legal and government documents on behalf of the business. You can act as your own Resident Agent or appoint someone you know. Professional Resident Agent in Maryland typically charge an annual fee ranging from $50 – $200.

In Maryland, your Resident Agent must:

  • Be a resident of Maryland or a business entity authorized to do business in the state.
  • Have a physical address in Maryland (P.O. boxes are not acceptable)

Choosing a reliable and responsible Resident Agent is essential, as failure to receive and respond to legal documents can seriously affect your business.

We reviewed some of the Best Registered Agent Services in Maryland and provided features as an add-on with their packages for you to check out.

LLC Service

Rating & Pricing

Top Features

Learn More

#1 Recommendation

$299 Per Year

  • Free LLC Formation

  • RA service in all states

  • Legal consultation

$125 Per Year

  • Flat price for RA service

  • LLC formation package

  • Fast service

Business Name Reservation Fee

If you have a specific business name in mind and want to ensure it is available when you are ready to file your Articles of Organization, you can reserve the business name with the Maryland Secretary of State.

In Maryland, your LLC name must:

  • Include the words “Limited Liability Company,” “LLC,” or “L.L.C.
  • Not contain any words or phrases that are prohibited by state law
  • Be distinguishable from the names of other businesses registered in the state

However, if you do not wish to file your LLC right away but want to hold the name that you have decided on, then you can reserve your LLC name for 30 days. You must file a name reservation application in the Maryland Secretary of State to keep the name.

The online name reservation fee is $25, while the mail name reservation fee is $25. You can register your business under a different legal name if your preferred name isn’t available. Once you have chosen a name, you can submit an application for a DBA (doing business as). If you have decided to file for a DBA, you can file it in three methods, online, by mail, and in person filing.. However, before filing Maryland DBA, you should know that you need to renew your DBA for up to five years, which cost $25 Filing Fee and $50 Expedited Fee.

Recommended: Embark on your entrepreneurial journey confidently and affordably with LegalZoom’s DBA service, the beacon that guides businesses to credible branding and comprehensive compliance. Discover how effortless success can truly be!

LegalZoom ($99 + Filling Fees)

Ongoing LLC Costs

After you know the initial costs of forming an LLC in Maryland, you should also know the ongoing costs once you have filed for an LLC. Here are the involved costs that you need to know.

Annual Report Filing Fee

To keep your LLC in good standing, you must file Annual Report with the Maryland Secretary of State. The Annual Report provides updated information about your LLC, such as changes in address, members, or Resident Agent.

In Maryland, the Annual Report fee costs $300 which can be paid every 1 year (15th April).

Franchise Tax or Annual LLC Tax

Some states require LLCs to pay an annual franchise or LLC tax, separate from the Annual Report filing fee. Franchise tax, or annual tax, is a fee imposed by Maryland on businesses, including LLCs and Maryland Corporations, for the privilege of operating within their jurisdiction. This tax is separate from income taxes and is usually based on factors such as the company’s net worth, assets, capital, or a fixed dollar amount, depending on the Maryland’s specific tax regulations.

Maryland LLC Taxes To Be Paid

The State of Maryland is one of those rarest states in the United States that does not levy any personal income tax on businesses. However, the business LLCs must file other taxes with the State authorities.

  • Sales Tax: A sales tax is a government-imposed tax on the sale of goods and services. It is generally added to the price of a product or service at the point of sale and paid by the consumer. The tax is collected by the retailer or service provider, who then remits the collected tax amount to the relevant government authority. In Maryland, the sales tax rate is 6.00%.
  • State Income Tax: Considering other taxes in Maryland, you should pay for the state income tax, with a rate of 8.25%.
  • LLC Federal Self-Employment Tax: Federal self-employment tax rates are the same across all states. Self-employment taxes are imposed on self-employed individuals or members of a Limited Liability Company (LLC) taxed as a sole proprietorship or partnership.
  • Property Tax: The property tax is fixed at 1.10% of industrial, commercial, residential, agricultural, and all other properties.

Business Licenses and Permits

Depending on the nature of your Maryland business and the location of your operations, you may need to obtain permits and business licenses in Maryland. The costs of these licenses and permits will vary based on your specific business and location. In Maryland, the business license ranges from $50 – $300. However, research the requirements for your LLC in Maryland and budget for these expenses accordingly.

Optional LLC Costs

Here are the optional costs you must consider if you will form an operating agreement or hire a professional service.

Operating Agreement

Although not required by law, it is highly recommended that LLCs create an operating agreement in Maryland. This document outlines the LLC’s ownership structure, management, and operating procedures. Hiring a business attorney to draft an operating agreement can cost anywhere from $500 to $2,000, or you can use online resources and templates to create one yourself.

Professional Services

You may hire professionals such as attorneys, accountants, or business consultants to help you establish and run your Maryland LLC. These services can provide valuable expertise and guidance but come at an additional cost. Consider the potential benefits and weigh them against the costs when hiring professional assistance.

You may check out the Best Business Attorney Services in Maryland that offer their professional services to form your business.

Can I Set Up an LLC For Free?

It’s impossible to set up an LLC entirely for free, as state filing fees and other costs are associated with establishing an LLC. However, you can save money by handling the formation process instead of hiring a professional service. Here are some steps to help you minimize the cost of setting up an LLC:

  • Choose your LLC’s name and check for availability in your state. This can generally be done through the Secretary of State’s website.
  • Prepare and file the Articles of Organization yourself. Maryland offer an online filing option or downloadable forms on their websites. By completing this process independently, you can avoid paying additional fees for a professional service.
  • Act as your own Resident Agent if permitted within Maryland. It allows the business owner to serve as the Resident Agent, saving you the cost of hiring a professional registered agent service.
  • Create your own Operating Agreement using online resources and templates. Although not required in every state, an Operating Agreement is highly recommended to outline your LLC’s ownership structure and management. By drafting this document yourself, you can save on legal fees.
  • Research and apply for any required licenses and permits on your own. Depending on your business type and location, you may need specific permits or licenses. These costs can vary, but handling the application process yourself can save you the expense of hiring a professional service.

While you can’t set up an LLC for free, taking a do-it-yourself approach and minimizing the use of professional services can help you save money during the formation process. However, handling these tasks requires time and effort, and there may be additional legal or financial risks if mistakes occur.

FAQs

What are the filing fees for forming an LLC in Maryland?
The filing fee for forming an LLC in Maryland is $100.
How much does it cost to file Articles of Organization in Maryland?
It costs $100 to file Articles of Organization in Maryland.
Are there any additional fees for forming an LLC in Maryland?
You may need to pay for a name reservation and registered agent service, which can increase the overall cost.
How much does it cost to reserve an LLC name in Maryland?
It costs $25 to reserve an LLC name in Maryland.
Is there a fee for filing the Annual Report in Maryland?
Yes, the fee for filing the Annual Report in Maryland is $300.
Are there any penalties for not filing the Annual Report on time in Maryland?
Yes, there is a $100 late fee for not filing the Annual Report on time in Maryland.
Do I need to hire a Maryland attorney to form an LLC?
No, you do not need to hire a Maryland attorney to form an LLC, but it can be helpful.
What are the costs associated with hiring a Maryland attorney to form an LLC?
The costs can vary based on the attorney’s fees and services provided.
What is the cost of obtaining an EIN for an LLC in Maryland?
Obtaining an EIN for an LLC in Maryland is free.
Can I form an LLC online in Maryland?
Yes, you can form an LLC online in Maryland using the Maryland Business Express website.
How long does it take to form an LLC in Maryland?
It typically takes around 7-10 business days to form an LLC in Maryland.
Is expedited processing available for LLC formation in Maryland?
Yes, expedited processing is available for an additional fee.
What is the cost of expedited LLC formation in Maryland?
The cost of expedited LLC formation varies based on the level of service requested.
Is publication required for forming an LLC in Maryland?
No, LLCs do not require publication upon formation in Maryland.
What is the cost of a Registered Agent in Maryland?
The cost of a Maryland Registered Agent varies based on the provider and level of service.
Do I need to use a Registered Agent service in Maryland?
Yes, LLCs in Maryland are required to have a Registered Agent.
Can I act as my own Registered Agent in Maryland?
Yes, you can act as your own Registered Agent in Maryland if you meet the requirements.
What is the annual fee for a Maryland Registered Agent?
The annual fee for a Maryland Registered Agent varies based on the provider and level of service.
What is the fee for converting an existing business to an LLC in Maryland?
The fee for converting an existing business to an LLC in Maryland is $100.
Is forming an LLC in Maryland more expensive than in other states?
Maryland’s LLC formation fees are relatively affordable compared to other states.
Is there a fee waiver available for small businesses forming an LLC in Maryland?
No, there is no fee waiver available for small businesses forming an LLC in Maryland.
What are the ongoing costs of maintaining an LLC in Maryland?
The ongoing costs of maintaining an LLC in Maryland include the Annual Report fee, hiring a Registered Agent, and any required business licenses or permits.
What is the cost of an Operating Agreement in Maryland?
The cost of an Operating Agreement in Maryland can vary based on your provider and level of service.
Is an Operating Agreement required for LLCs in Maryland?
No, an Operating Agreement is not required for LLCs in Maryland, but it is highly recommended.
How much does it cost to file for Dissolution of an LLC in Maryland?
It costs $100 to file for the dissolution of an LLC in Maryland.
What happens if I do not file for Dissolution of an LLC in Maryland?
If you do not file for Dissolution of an LLC, you may still be liable for legal and tax obligations.
Is there a penalty for not filing for Dissolution of an LLC on time in Maryland?
Yes, there is a late fee of $100 for not filing for Dissolution of an LLC on time in Maryland.
What factors should I consider when determining LLC costs in Maryland?
You should consider the filing fees and ongoing costs, such as Registered Agent and Annual Report fees, when determining LLC costs in Maryland.
What is the cost to file an LLC in Maryland?
The cost to file an LLC in Maryland is $100.
Can I file my LLC online in Maryland?
Yes, you can file your LLC online in Maryland.
What is the processing time for filing an LLC in Maryland?
The processing time to file an LLC in Maryland is usually around 4-6 weeks.
How many members are required to form an LLC in Maryland?
Only one member is required to form an LLC in Maryland.
What is the annual maintenance cost for LLCs in Maryland?
The annual maintenance cost for LLCs in Maryland is $300.
Are there any additional taxes for LLCs in Maryland?
Yes, LLCs in Maryland are subject to State Income Tax and Sales & Use Tax.
What is the deadline for filing annual reports for LLCs in Maryland?
The deadline to file annual reports for LLCs in Maryland is April 15th.
Is a registered agent required for Maryland LLCs?
Yes, Maryland LLCs are required to have a registered agent.
Can I be my own registered agent for my Maryland LLC?
Yes, you can be your own registered agent for your Maryland LLC.
Does Maryland require an operating agreement for LLCs?
Although it’s not required, it’s always recommended to have an operating agreement for your Maryland LLC.
Are there any franchise taxes for LLCs in Maryland?
Yes, LLCs in Maryland are subject to franchise taxes.
How much is the franchise tax for LLCs in Maryland?
The minimum franchise tax for LLCs in Maryland is $300.
Is it possible to dissolve an LLC in Maryland?
Yes, it’s possible to dissolve an LLC in Maryland.
Can I cross-register an out-of-state LLC in Maryland?
Yes, out-of-state LLCs can be cross-registered in Maryland.
What is the cost to cross-register an out-of-state LLC in Maryland?
The cost to cross-register an out-of-state LLC in Maryland is $100.
Can I change my LLC name in Maryland?
Yes, you can change your LLC name in Maryland.
What is the cost to change an LLC name in Maryland?
The cost to change an LLC name in Maryland is $100.
Are non-residents allowed to form LLCs in Maryland?
Yes, non-residents are allowed to form LLCs in Maryland.
Do I need a lawyer to file an LLC in Maryland?
No, you don’t need a lawyer to file an LLC in Maryland, but it’s always recommended to consult with one.
Are there any residency requirements for LLC owners in Maryland?
No, there are no residency requirements for LLC owners in Maryland.
Can LLCs in Maryland be managed by members or managers?
LLCs in Maryland can be managed by members or managers.
What is the cost to hire a registered agent in Maryland?
The cost to hire a registered agent in Maryland varies depending on the company.
Can I amend my articles of organization in Maryland?
Yes, you can amend your articles of organization in Maryland.
What is the cost to amend articles of organization in Maryland?
The cost to amend articles of organization in Maryland is $100.
Are there any annual meetings required for LLCs in Maryland?
No, there are no annual meetings required for LLCs in Maryland.
Can LLCs in Maryland own property?
Yes, LLCs in Maryland can own property.
What is the annual personal property tax for LLCs in Maryland?
The annual personal property minimum assessment is $300, which is due each year by April 15th.
Is a business license required for LLCs in Maryland?
Yes, a business license is required for LLCs in Maryland.
What is the cost to purchase a business license in Maryland?
The cost to purchase a business license in Maryland varies depending on the type of business activity.

Also Read

How to Save Money While Starting Your Business LLC in Maryland

First and foremost, take advantage of the various free resources available to entrepreneurs. The state of Maryland offers numerous programs and services geared towards assisting small business owners in their endeavors. Maryland’s Small Business Development Center (SBDC) provides free guidance on developing a business plan, accessing funding, and understanding legal requirements. Additionally, they organize workshops and training sessions to equip potential business owners with vital skills. By tapping into these free resources, you can avoid unnecessary costs typically associated with obtaining professional advice.

Careful budgeting is crucial when starting a business. It may be tempting to splurge on luxurious office spaces and fancy equipment right from the beginning. However, this can quickly drain your financial resources and put unnecessary strain on your business. Instead, start small and focus on what is most essential. Think about renting affordable shared office spaces or utilizing co-working spaces to minimize rental costs. Consider purchasing used equipment or leasing instead of buying brand new. Remember, it is far more important to have a solid foundation for your business than to focus on appearances alone. Once your business starts generating profit, you can then invest in upgrading your premises and equipment.

Furthermore, make shrewd decisions about the services you require. Every business needs certain services to operate effectively, such as bookkeeping, legal advice, or marketing assistance. Rather than hiring full-time employees for these roles, which can be expensive, explore alternatives. Many talented professionals offer their services on a freelance or consultancy basis. This approach allows you to benefit from their expertise without the ongoing costs associated with full-time employees. Contracting with specialized professionals not only saves money but also allows you to tap into a diverse pool of talent.

Leverage the power of technology to reduce expenses and streamline operations. Nowadays, there are countless software applications and digital tools specifically designed for small businesses. Research and invest in these tools wisely to automate repetitive tasks, manage inventory efficiently, and optimize your online presence. For instance, cloud-based accounting software can help you keep track of your finances without the need for pricey accounting services. Moreover, embrace the use of social media platforms for marketing your business as they are cost-effective and provide a wide reach.

Lastly, don’t forget to network effectively. Building connections and relationships within your business community can provide various cost-saving opportunities. Join local business associations, attend conferences and events, and create meaningful partnerships. Networking can help you access discounts on products or services, find cheaper suppliers, and learn from the experiences of others. Additionally, you may even come across potential investors or business partners who are willing to contribute to your venture.

Starting your business LLC in Maryland doesn’t have to break the bank. With careful planning, prudent decision-making, and astute use of available resources, it is possible to save money while on this exciting entrepreneurial journey. By taking advantage of free resources, budgeting carefully, outsourcing services, leveraging technology, and networking effectively, you can establish a flourishing business in a financially sound manner. Remember, every penny saved in the early stages will contribute to the long-term success of your business.

Conclusion

Forming and maintaining an LLC in Maryland involves various costs, including initial filing fees, ongoing annual report fees, and taxes. Understanding and planning for these costs is essential when establishing your LLC. Additionally, consider any optional expenses, such as hiring professional services or drafting an operating agreement, to ensure the success and longevity of your LLC in Maryland.

Leave a Comment