A small business in Maryland is one that has fewer than 500 employees and less than $7 million in annual revenues. Additionally, a small business must be independently owned and operated, not be dominant in its field, and have a purpose that is not solely profit-driven. Military veterans make up 6.9% of Maryland’s small business owners. Racial minorities represent 42.5% of all small business employees in the state.
Starting a Small Business in Maryland
Steps to Launch a Small Business
Key steps:
- Choose a business structure such as LLC or corporation
- Register your business
- Obtain licenses and permits
- Arrange financing
- Understand tax obligations
- Comply with regulations
- Connect with small business resources
The Maryland Small Business Development Center provides free counseling and assistance to entrepreneurs. Online resources are also available through the Maryland Department of Commerce.
Benefits of an LLC structure in Maryland include pass-through taxation. An LLC’s profits pass directly to owners, avoiding corporate double taxation. However, owners must still report overall business profits on personal returns.
Maryland supports small business growth through scientific innovation, a skilled workforce, and business development programs. Leaders still face challenges like regulatory compliance and access to capital and talent.
Forming an LLC in Maryland
How does Maryland classify an LLC business? A limited liability company (LLC) in Maryland offers liability protection to its owners. LLCs are easy to set up and maintain, offering flexibility in structure and operation. Requirements for an LLC are in the Maryland LLC Act. To form an LLC, steps include:
- Choose a name
- Appoint a resident agent
- File articles of organization
- Pay $100 filing fee
- Draft operating agreement
The fastest way to form an LLC is online through the Maryland Business Express website. Use a street address. Expedited processing is available.
Ongoing requirements exist like annual reports, but an LLC in Maryland provides owners liability protection and tax flexibility. Entrepreneurs can successfully establish an LLC with proper planning.