How to start a business in Maryland: 2026 step-by-step guide

How to start a business in Maryland in 2026. Starting a business in Maryland requires four state-level steps plus optional local and trade-specific licenses. This guide walks through every step. Step 1: Choose a business entity. Most Maryland small businesses form as a Maryland LLC or a Maryland Corporation. The LLC is the more common choice for single-owner or small-team operations because it provides liability protection with minimal ongoing formalities. The Maryland LLC filing fee is $100 plus a $300 annual personal property return filing fee. The Maryland Corporation filing fee is $100 plus annual report fees. Step 2: File with the Maryland Department of Assessments and Taxation. Every Maryland business must register with the Maryland Department of Assessments and Taxation (SDAT). The SDAT filing creates the legal entity, assigns the Maryland business entity number, and registers the business for Maryland taxes. Online filing: egov.maryland.gov/businessexistence. Step 3: Apply for an EIN. The federal Employer Identification Number is required for any business with employees, any LLC with multiple members, and any business with a bank account in the business name. Apply free at irs.gov/lein. Step 4: Open a business bank account. Maryland business banks include M&T Bank, Atlantic Union Bank, Sandy Spring Bank, and the national banks. Most require the EIN, the SDAT articles of organization, and a copy of the operating agreement or bylaws. Trade-specific licensing. Maryland has more than 100 state-issued trade and professional licenses. The most common for small businesses: Maryland Home Improvement Commission (MHIC) license for general contractors performing work over $1,000. Maryland Board of Physicians license for medical practices. Maryland Board of Dental Examiners for dental practices. Maryland State Bar admission for law firms. Maryland Real Estate Commission license for real estate brokerages. Maryland Board of Cosmetologists for salons. Maryland Board of Barbers for barbershops. Maryland Department of Agriculture licenses for certain food and plant businesses. Maryland Alcohol and Tobacco Commission license for any business selling alcohol. Local business licenses. Most Maryland counties require a local business license in addition to the state registration. Montgomery County, Frederick County, Howard County, and Prince Georges County all have their own licensing processes. Zoning approval. Every Maryland business must operate in a properly-zoned location. For home-based businesses, the local zoning ordinance determines whether you can run the business from your home. Check with the county planning department. The first 90 days. After registration, the priority list is: open a business bank account, set up bookkeeping, get business insurance (general liability, professional liability, and workers comp as needed), register for Maryland sales tax if selling taxable goods, register with the IRS for any federal taxes, and claim your business at https://301businessdirectory.com/register so Maryland residents can find you.