To start a business in Maryland, you pick a legal structure, register it with the State Department of Assessments and Taxation (SDAT) through Maryland Business Express, get a free EIN from the IRS, open state tax accounts with the Comptroller, and secure any county trader's license or permits. Forming an LLC or corporation costs $100 at SDAT, and both pay a $300 Annual Report fee every April 15 after that.

This guide walks through the seven steps the state itself lists, in order, with the official source for every fee and deadline. It also covers what is new for 2027 (Maryland's paid leave program) and the free programs that help Maryland founders get funded.

Get the weekly list of DMV startup events, grants and deadlines. Join the StartDMV list at https://startdmv.org.

Maryland business startup costs at a glance

Red lighthouse on the Baltimore harbor waterfront in Maryland

Photo via Magnific

ItemCostWho needs itSource
LLC Articles of Organization$100New LLCsSDAT fee schedule
Articles of Incorporation (stock corporation)From $100New corporationsSDAT fee schedule
Expedited review+$50Optional, 7 to 10 business daysSDAT fee schedule
Online same-day service+$325Optional, submit by 2:30 PMSDAT fee schedule
Trade name registration$25Anyone operating under a different nameSDAT fee schedule
EINFreeMost businessesIRS
Annual Report (Form 1)$300 per yearLLCs, stock corporations, LPs and LLPsSDAT 2026 Form 1
Trader's or local licenseVaries by county and inventoryBusinesses that resell goods, plus regulated tradesClerk of the Circuit Court

Maryland Business Express also adds a 3% convenience fee to online payments, according to the SDAT fee schedule. Budget for the $300 Annual Report from day one: it is due even in a year with no revenue.

Step 1: Choose your business structure

Your structure decides what you file, what you pay each year and how much personal liability protection you get. Maryland Business Express notes that sole proprietorships and general partnerships are not separate legal entities the way LLCs and corporations are.

  • Sole proprietorship: the simplest option for one owner, with no formation filing and no liability shield. You still follow state and local licensing and tax rules.
  • General partnership: two or more owners sharing profits and liability, again without a separate entity.
  • LLC: the default for most small businesses and many early startups. It separates business debts from your personal assets and costs $100 to form.
  • Corporation: the usual choice for founders planning to raise venture capital, since investors typically expect stock and a board. Many venture-backed founders incorporate in Delaware and then register in Maryland as a foreign corporation, so talk with a startup attorney before you file.

If you are forming an LLC specifically, our step-by-step guide to starting an LLC in Maryland covers naming rules, resident agents and operating agreements in more detail.

Step 2: Register with SDAT through Maryland Business Express

SDAT is the state agency that forms Maryland entities. The fastest path is online through Maryland Business Express, which forms most Maryland businesses and registers out-of-state (foreign) businesses. You can also mail paper forms from the SDAT forms page to SDAT Charter, 700 E. Pratt St., Suite 2700, Baltimore, MD 21202.

When you register, SDAT issues an SDAT ID: a letter (D, F, W, L, T or Z) followed by eight numbers. Business Express points out that even sole proprietors and general partnerships need an SDAT ID to open a business bank account. If you will operate under any name other than your own legal name or your entity's exact name, file a trade name registration for $25.

Timing tip: standard paper processing can take weeks. If you need your entity quickly to sign a lease or open a bank account, pay the $50 expedite fee or the $325 online same-day option listed on the SDAT fee schedule.

Step 3: Get a free EIN from the IRS

Most businesses need a Federal Employer Identification Number to open a bank account, hire employees and register for state taxes. Apply directly on IRS.gov. The IRS never charges for an EIN, so skip any website that asks you to pay for one.

Step 4: Open Maryland tax and insurance accounts

Next, register with the Comptroller of Maryland using the Combined Registration Application, which issues your Central Registration Number (CRN) for state filings. According to Maryland Business Express, the accounts most new businesses need are:

  • Sales and use tax license: if you sell taxable goods or services in Maryland. Keep sales and purchase records for four years, because the Comptroller puts the burden of proof on you.
  • Employer withholding: required once you pay wages to employees.
  • Unemployment insurance: registered through the Maryland Department of Labor, with quarterly tax payments and wage reports.

Specialty accounts such as motor fuel, alcohol and tobacco go through Maryland Tax Connect instead. Questions go to the Comptroller at 1-800-MDTAXES.

Step 5: Get your county licenses and permits

Maryland's state business licenses, including the trader's license you need if you buy goods and resell them, are issued by the Clerk of the Circuit Court in the county where your business is located. The Comptroller's new business page says first-time license applicants must register with SDAT before contacting the Clerk.

  • Find your clerk on the Comptroller's list of Circuit Court Clerks.
  • Check state occupational licenses (contractors, real estate, cosmetology and more) on the Maryland OneStop portal.
  • Ask your county's permits office about zoning, health and building permits, which vary widely between jurisdictions.

The state's licenses and permits guide gives a useful example: a restaurant in one county may need very different permits than a retail store in another.

Step 6: Insurance and the new FAMLI paid leave program

Maryland Business Express lists business insurance and employee health insurance as separate startup steps. If you plan to hire in Maryland, the biggest change on the calendar is the Family and Medical Leave Insurance program. Per the state's FAMLI page:

  • All employers with at least one employee working in Maryland must register, with no exceptions under state law.
  • Payroll withholding begins January 1, 2027, and employers may deduct up to half of the required contribution from employees.
  • Contributions are first due in April 2027.
  • Benefits start January 1, 2028, with up to 12 weeks of paid leave for eligible employees.

Employers can apply to use an approved private plan instead. Details are on paidleave.maryland.gov.

Step 7: Stay in good standing every April 15

Every Maryland LLC, stock corporation, limited partnership and LLP files Form 1, the Annual Report and Personal Property Return, with SDAT by April 15. The fee is $300 for those entity types and $0 for nonstock corporations (2026 Form 1). Late filers owe a penalty of one tenth of one percent of the county assessment plus interest for each 30-day period, and businesses approved through MarylandSaves may qualify for a fee waiver.

Free help and funding for Maryland founders

Once you are registered, these StartDMV directory listings are the best next stops:

Looking for non-dilutive money? Start with our list of small business grants in Maryland. Then meet investors in person: upcoming picks on the StartDMV events calendar include TEDCO's 2026 Entrepreneur Expo (October 27, Baltimore), A VC's Perspective: How Investors Really Decide (November 13, Baltimore) and Community Connect #9 (November 18, Germantown).

Maryland business startup checklist

  1. Choose a structure: sole proprietorship, partnership, LLC or corporation
  2. Register with SDAT on Maryland Business Express and save your SDAT ID
  3. Register a trade name ($25) if you use a different business name
  4. Get a free EIN from the IRS
  5. File the Combined Registration Application for sales tax and withholding
  6. Register for unemployment insurance and FAMLI before you hire
  7. Get your trader's license and county permits
  8. Buy business insurance
  9. File Form 1 by April 15 every year

This guide is general information, not legal or tax advice. Confirm your situation with a Maryland attorney or CPA.

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Get the weekly list of DMV startup events, grants and deadlines. Join the StartDMV list at https://startdmv.org.