Maryland corporation landscape
Maryland’s corporate statutes mirror Delaware flexibility but keep filing costs low: $100 articles, scalable charter fees, and a well-understood annual report/personal property regime. Whether you are issuing QSBS-friendly shares, forming a benefit corporation, or converting from LLC status, everything flows through SDAT’s charter division.
Need a Maryland LLC playbook instead? Jump to the Maryland LLC guide.
| Entity | Statutes | Use cases | Highlights |
|---|---|---|---|
| Stock corporation (C-corp) | Title 2 | Growth companies, QSBS planning, institutional investors. | Multiple share classes, board governance, 8.25% state corporate tax. |
| S-corporation | Title 2 + IRC subchapter S | Owner-operated firms seeking pass-through treatment. | Same charter as C-corp; PTET election satisfies nonresident withholding. |
| Benefit corporation | Title 5, Subtitle 6C | Mission-driven ventures needing statutory stakeholder duties. | Annual public benefit report; board considers broader stakeholders. |
| Professional corporation | Corporations & Ass’ns §§5-101 et seq. | Law, medical, dental, engineering groups. | Ownership limited to licensed professionals; malpractice exposure carved out. |
| Nonstock corporation | Title 5, Subtitle 2 | Associations, nonprofits, cooperatives. | No shares; governed by members/directors; same $300 annual report. |
Formation workflow & first 90 days
Most Maryland corporations form online within a day, but the heavy lifting happens immediately afterward: organizing the board, issuing stock, and preparing for the April 15 annual report.
Articles & share planning
Sample share structures
- Bootstrap plan: 10,000 no-par common shares (base fee only); reserve 2,000 for incentives.
- Seed-ready: 10M authorized ($0.0001 par) split between common and Series Seed Preferred; pay ~$1,120 charter fee to avoid early amendment.
- Professional corp: 100 par-value shares to match ownership percentages across licensed shareholders.
Conversions & domestications
Maryland supports statutory conversions between LLCs and corporations. When moving into Maryland from another state, file articles of domestication along with a Maryland charter. Moving out requires foreign qualification in the destination plus Maryland articles of conversion.
First 90-day corporate implementation
Governance, professional & benefit structures
Maryland corporations can be stock, nonstock, professional, or benefit corporations. Governance is board-driven unless you elect close-corporation treatment via shareholder agreements.
Professional corporations
Law, medical, dental, engineering, and other licensed professions may form professional corporations. Shareholders, directors, and officers generally must hold active licenses in the profession. The entity shields contractual liabilities, but malpractice claims remain personal. Many practices compare PC vs PLLC: I analyze insurance requirements, ownership restrictions, and S-election eligibility before deciding.
Benefit corporations
Add “general public benefit” to your articles and specify any particular benefits (e.g., affordable housing, sustainability). Directors must consider stakeholders, and an annual benefit report goes to shareholders and (optionally) SDAT. Benefit status does not change tax treatment, but it impacts investor expectations, so I pair the articles with bylaws/policies that define metrics and reporting cadence.
Nonstock corporations
Homeowners’ associations, nonprofits, and cooperatives often use nonstock charters. There are no shares; membership and board rules go into bylaws. Charitable organizations still need to register with the Office of the Secretary of State and may qualify for 501(c)(3) status. Annual report obligations remain the same.
Close corporations & shareholder agreements
Maryland allows corporations to eliminate or restrict the board through unanimous shareholder agreements (close corporation treatment). Use this cautiously—lenders and future investors prefer board-controlled governance, but for closely held family businesses it can simplify operations.
Taxes, filings & ongoing compliance
Every Maryland corporation—stock, nonstock, professional, or foreign—files the annual report/personal property return and pays $300. On the tax side, decide between C-corp treatment (8.25% rate) and S-corp/PTET pass-through. Missing filings leads to forfeiture and blocked transactions.
C-corp taxation
File Form 500 and pay 8.25% of Maryland-allocable net income. Credits exist for R&D, enterprise zones, and film production. City-level corporate income tax does not apply, but counties levy personal property tax through the annual return.
S-corp & PTET
S-corps remain subject to Maryland’s replacement of nonresident withholding unless the entity elects PTET (Form 511). PTET is paid at 8% for individual owners and 8.25% for entity owners, with credits flowing through shareholder returns.
Annual report & personal property
File Form 1 by April 15 (or earlier if you need a certificate of good standing). Even asset-light corporations file the cover page and pay $300. Owning property or trader’s licenses means completing the full schedules, which counties use to assess tax.
Corporate formalities
Hold regular board/shareholder meetings, keep minutes, and adopt resolutions for major actions (loans, stock issuances, significant contracts). Maryland courts pierce easily if you commingle or skip formalities.
| Task | Deadline | Notes |
|---|---|---|
| Articles of Incorporation | Day 0 | $100 filing + $20 organization fee (more for additional shares/par value). |
| Organizational meeting | Within first 30 days | Adopt bylaws, elect directors/officers, authorize stock and bank accounts. |
| Annual report & personal property return | April 15 | $300 fee plus county personal property tax where applicable. |
| PTET / 2553 election | Within 75 days of incorporation or start of tax year | File IRS Form 2553 + Maryland PTET election if desired. |
| Nonresident withholding or PTET estimates | Quarterly | 8%/8.25% withholding on nonresident shareholders unless PTET made. |
| Licenses & trader’s taxes | County-specific (often July 1) | Keep proof of payment for annual report preparations and bank diligence. |
Charter fee & annual cost snapshot
Use the slider-style inputs to estimate base charter fees (simplified) and the recurring $300 obligation.
This calculator assumes you stay near the base thresholds. If you authorize millions of shares or high par values, expect the charter fee to approach $3,000.
CTA, foreign qualification & pitfalls
Maryland-formed corporations currently fall outside FinCEN’s CTA reporting requirements, but foreign-formed companies registering here remain “reporting companies.” Meanwhile, most reinstatement cases I handle stem from neglected annual reports or resident agent resignations.
CTA / BOI status
Domestic Maryland corporations (stock, nonstock, benefit, PC) are exempt from BOI reporting under the March 2025 interim rule. Maintain ownership ledgers anyway—the rule could be reinstated after litigation. Foreign corporations qualifying in Maryland must still file BOI within 30 days unless another exemption applies.
Foreign qualification checklist
Doing business via an HQ, employees, or inventory requires registration. File the Foreign Corporation Qualification, attach a recent certificate of existence, appoint a Maryland resident agent, and budget for the same $300 annual report.
Docs I gather
- Certificate of existence dated within 30 days.
- Certified charter or articles if banks request them.
- Board resolution authorizing Maryland registration.
- Maryland personal property account numbers for each location.
Common pitfalls: (1) Missing the April 15 report, triggering forfeiture that halts financings and real estate closings. (2) Combining corporate and personal funds—Maryland courts pierce fast. (3) Authorizing too few shares, forcing an amendment before your first financing. (4) Letting the resident agent resign; SDAT administratively dissolves if you ignore the notice. I address these in every client onboarding.
My services for Maryland corporations
I run a boutique, attorney-led practice—no paralegal handoffs. I scope each engagement, draft the documents myself, and coordinate with your CPA, investors, and licensing boards.
Formation + bylaws
- Articles of incorporation, resident agent consent, and charter fee planning.
- Custom bylaws, organizational minutes, stock ledger, and share certificates.
- Initial compliance calendar with annual report reminders.
Growth & financing
- Preferred stock or SAFE/convertible note structuring.
- Benefit corporation amendments, shareholder agreements, and investor rights letters.
- QSBS and PTET coordination with tax advisors.
Reinstatement & clean-up
- Catch-up annual reports/personal property returns and fee negotiations.
- Reinstatement filings, resident agent updates, and lender-good-standing packets.
- Board/shareholder meeting templates to re-establish formalities.
Review-only
- Attorney redline of client-prepared charter/bylaws.
- Memo on Maryland corporate defaults & PTET/withholding issues.
- 30-minute Zoom consult + follow-up edits.
Schedule a Maryland corporate consult
Book a 30-minute Zoom via Calendly or email me. I limit active matters so I can stay directly involved.