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How to Start a Business in Maryland

Are you planning on starting a new business in Maryland, but aren’t sure how to get started?

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Maryland is one of the smallest U.S. states in area, but one of the most densely populated states with its 6 million residents. With close proximity to Washington, D.C., and a diversified economy, Maryland has the highest median household income of any state. Nicknamed “America in Miniature,” Maryland has a wide variety of topography ranging from sandy dunes, low marshlands, and pine grove mountains. Maryland blue crabs have been an integral part of dinner since the 1800s, not to mention the economy. There are a few resources for small businesses in the form of free on-site technical consultations, low-interest loans, grants, and business mentoring.

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How to Start a Business

Starting a business can be both exhilarating and challenging. It requires your full attention and energy. It all begins with an idea, an observation that there is a problem and the belief that you have a new solution – or a better one. Allow us to walk you through the steps in this free guide: How to Start A Business.

General resources for starting a business in Maryland

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Fun facts about starting a business in Maryland

Famous business headquartered in Maryland The Ritz-Carlton Hotel Company

The Ritz-Carlton Hotel Company is the parent company to the luxury hotel chain, The Ritz-Carlton Hotels. Ritz-Carlton operates 87 luxury hotels and resorts in major cities and resorts in 29 countries. It’s headquartered in Chevy Chase, Maryland.

Famous entrepreneur born in Maryland Johns Hopkins

Johns Hopkins (1795–1873) was an entrepreneur, abolitionist and philanthropist of 19th-century Baltimore, Maryland. He was born in Anne Arundel County, Maryland. Numerous institutions have been founded bearing his name, most notably Johns Hopkins Hospital, and Johns Hopkins University.

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Which type of legal structure is best for my business in Maryland?

You must consider the tax, legal, and liability implications carefully before deciding on the best structure. We strongly recommend you incorporate.

Here are five helpful steps to determine the best legal structure for your business:

Click one of the buttons below to learn more about the different types of business legal structures and how to start them in the state of Maryland.
LLC (Limited Liability Company)
A limited liability company (LLC) is a hybrid legal structure that provides the limited liability features of a corporation with the tax efficiencies and operational flexibility of a partnership.

Steps to starting an LLC in Maryland:

  • Step 1 — Name your LLC.
  • Step 2 — File Articles of Organization.
  • Step 3 — Appoint a Registered Agent.
  • Step 4 — Prepare an Operating Agreement.
  • Step 5 — Comply with any publication requirements.
  • Step 6 — Comply with other tax and regulatory requirements.
  • Step 7 — File Annual Reports.
  • Step 8 — Register foreign LLCs doing business in Maryland.

For help forming your LLC in Maryland we recommend CorpNet (they have fees for their service).
Alternatively, you can visit the Maryland Secretary of State website.

Other Maryland resources for LLCs:

Secretary of State Business Name Database: Search for the availability of your LLC name here.
File your “Trade Name Application” here.
File your “Articles of Incorporation” here.
File your “Annual Reports” here.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your LLC here. If your LLC has more than one member, you must get an EIN, even if you have no employees.

Comptroller of Maryland: If you will be selling goods or will have employees, you’ll need to register here.

Sole Proprietorship
A sole proprietorship is an unincorporated business. A sole proprietorship has one owner who pays personal income tax on all profits from the business. With little government regulation, they are the simplest business to set up or take apart, making them popular among individual business owners or self contractors.

Steps to starting Sole Proprietorship in Maryland:

  • Step 1 — Choose a business name.
  • Step 2 — File an application to register a trade name with the Department of Assessments and Taxation.
  • Step 3 — Obtain licenses, permits, and zoning clearance.
  • Step 4 — Obtain an Employer Identification Number (EIN).

For help forming your sole proprietorship in Maryland we recommend CorpNet (there are fees for their service).
Alternatively, you can visit the Maryland Secretary of State website.

Other Maryland resources for Sole Proprietorship:

Secretary of State Business Name Database: Search for the availability of your business name here. A sole proprietor may use his or her given name, or an assumed business name.

Maryland Department of Assessments and Taxation: File your trade name here.

U.S. Patent & Trademark Office: Federal database for existing trademark registrations. Click on the “TESS” link to conduct a search.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your sole proprietorship here. If you hire employees, you will need an EIN.

Comptroller of Maryland: If you will be selling goods or will have employees, you’ll need to register here.

Partnership
A partnership is created from two or more people doing business together for profit and share ownership. There doesn’t have to be a written agreement to form the partnership. Each partner contributes to all aspects of the business, and shares in the profits and losses of the business.

Steps to starting Partnership in Maryland:

  • Step 1 — Name your partnership.
  • Step 2 — File an assumed name certificate with the city or town clerk.
  • Step 3 — Create a partnership agreement.
  • Step 4 — Obtain licenses, permits, and zoning clearance.
  • Step 5 — Get an Employer Identification Number (EIN).

For help forming your partnership in Maryland we recommend CorpNet (they have fees for their service).
Alternatively, you can visit the Maryland Secretary of State website.

Other Maryland resources for Partnership:

Secretary of State Business Name Database: Search for the availability of your business name here. A partnership may use the surnames of the individual partners, or a fictitious business name.

Maryland Department of Assessments and Taxation: File your trade name here.

U.S. Patent & Trademark Office: Federal database for existing trademark registrations. Click on the “TESS” link to conduct a search.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your partnership here. Partnerships must have an EIN, whether you have employees or not.

Comptroller of Maryland: If you will be selling goods or will have employees, you’ll need to register here.

S Corporation
An S corporation (or S Corp) is a special type of corporation created through an IRS tax election. An eligible domestic corporation can avoid double taxation (once to the corporation and again to the shareholders) by electing to be treated as an S corporation. The corporation's income or losses are divided among and passed through to its shareholders. The shareholders must then report the income or loss on their own individual income tax returns.

Steps to starting S Corporation in Maryland:

  • Step 1 — Name your corporation.
  • Step 2 — File an Articles of Incorporation.
  • Step 3 — Find a registered agent.
  • Step 4 — Set up a corporate records book.
  • Step 5 — Prepare corporate bylaws.
  • Step 6 — Appoint initial corporate directors.
  • Step 7 — Hold your first Board of Directors meeting.
  • Step 8 — Issue stock.
  • Step 9 — Comply with annual report requirements.
  • Step 10 — Comply with other tax and regulatory requirements.
  • Step 11 — Register foreign corporations doing business in Maryland.

For help forming your S corporation in Maryland we recommend CorpNet (they have fees for their service).
Or, you can visit the Maryland Secretary of State website.

Other Maryland resources for S Corporation:

Secretary of State Business Name Database: Search for the availability of your corporate name here.
File your “Trade Name Application” here.
File your “Articles of Incorporation” here.
File your “Annual Reports” here.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your partnership here. Partnerships must have an EIN, whether you have employees or not.

IRS S corporations: Specific instructions for your tax requirements as an S corp.

Comptroller of Maryland: Register here to fulfill your business tax obligations.

C Corporation
A C corporation (or C corp for short), refers to any corporation that is taxed separately from its owners. A C corporation is distinguished from an S corporation, which generally is not taxed separately. There is no limit to the number of shareholders a C corporation can have. It is the most common type of corporation in the U.S.

Steps to starting C Corporation in Maryland:

  • Step 1 — Choose a corporate name.
  • Step 2 — Prepare and file Articles of Incorporation.
  • Step 3 — Appoint a registered agent.
  • Step 4 — Set up a corporate records book.
  • Step 5 — Prepare corporate bylaws.
  • Step 6 — Appoint initial corporate directors.
  • Step 7 — Hold your first Board of Directors meeting.
  • Step 8 — Issue stock.
  • Step 9 — Comply with annual report requirements.
  • Step 10 — Comply with other tax and regulatory requirements.
  • Step 11 — Register foreign corporations doing business in Maryland.

For help forming your C corporation in Maryland we recommend CorpNet (they have fees for their service).
Alternatively, visit the Maryland Secretary of State website.

Other Maryland resources for C Corporation:

Secretary of State Business Name Database: Search for the availability of your corporate name here.
File your “Trade Name Application” here.
File your “Articles of Incorporation” here.
File your “Annual Reports” here.

IRS EIN Online: Apply for an Employer Identification Number (EIN) for your partnership here. Partnerships must have an EIN, whether you have employees or not.

Comptroller of Maryland: Register here to fulfill your business tax obligations.

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Why choose Maryland for my business?

  • 1

    Maryland Small Business Development Center
    “If you are an aspiring entrepreneur or an existing small business owner planning to successfully take your business to new levels, The SBDC has a variety of programs to help you meet your goals.”

  • 2

    Maryland Entrepreneurs Resources List
    “The Maryland Entrepreneurs Resource List is a listing of entrepreneurs who are available in the Maryland area to assist with technology or biotechnology start-up companies. The list can be used by innovators who need an entrepreneur to commercialize their technology or by university and federal laboratory technology transfer professionals who want to identify management for a start-up opportunity being developed at their institution. The list can also provide entrepreneurs their next start-up opportunity or a chance to network with and mentor other entrepreneurs.”

  • 3

    Maryland Business Assistance Providers
    “A wide variety of services are available to help Maryland businesses improve both their financial and environmental performance. This assistance comes in the form of free on-site technical consultations, low-interest loans, awards and recognition, business-to-business mentoring, training and seminars all focusing on reducing costs and increasing productivity through greater efficiency.”

  • 4

    Maryland Business Incubation Association
    “The Maryland Business Incubation Association (MBIA) was founded in 2002 to advance business incubation in Maryland. Representing 22 incubators, MBIA supports nearly 550 companies across the state in both urban and rural areas. Since its inception, our incubators have generated 11,800 jobs, making it equivalent to one of the state’s largest employers.”

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