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Step 3: Determine Your Business Legal Entity

The SBDC cannot register a business, that is the role of the Maryland Department of Assessment and Taxation. We can, however, redirect you to the web site where you can download the form and print it.

Department of Assessment and Taxation at www.dat.state.md.us

At the very top banner click on the link for "Forms and Applications". In the Charter Division there, scroll down to select the business structure entity you desire. We are prohibited from offering legal advice.
If you need to research whether or not your business needs a business license, go to

Business License Information at www.blis.state.md.us/

Use the drop down box on the side of the page, and select the county you will operate your business in. Contact the office or person listed to determine your status.


The Plan
When you have performed a self-assessment and gone through our Smart Start training, it will then be important to research and determine your business type and go through the registration process for the chosen business type. There are three general forms of business organizations of which the State of Maryland recognizes:

  1. sole proprietorships
  2. partnerships
  3. corporations
In addition with several hybrid forms including the limited liability partnership, limited partnership, limited liability limited partnership, and limited liability company. Determining your business type will lead you to the correct registration process for the State. As a note: although most businesses are operated as sole proprietorships, corporations usually conduct more business based on dollar value of sales. Small Business in Maryland is over 95% of the economy's wealth.


Maryland Recognized Business Entities
Sole Proprietorship
General Partnership
Limited Partnership (LP)
Limited Liability Partnership (LLP)
Limited Liability Limited Partnership (LLLP)
Incorporation (C-corp., S-corp., Close Corporation)
Limited Liability Company

It is very important that you take the time to start your organization the way you want; therefore, weighing the advantages and disadvantages of each business type becomes crucial. You may want to think about starting as a corporation or a LLC if you plan to expand your business in the future. Check out www.bizfilings.com for a business entity comparison chart or www.incorporateinanystate.com to see the advantages and disadvantages of the different business entities. The Web site IANR.unl.edu will give you some publications on all small business entities and their variations (including s-corp. and limited partnership) under the small business section. These publications go over the advantages and disadvantages and the tax implications of each entity. Be reminded it is the best to consult a lawyer when setting up legal entities. The Website MDbusiness.state.md.us will link you to The Guide to Legal Aspects of Doing Business in Maryland written by the Maryland Attorney General Curran Jr. (to find it from the home page, link under the tab Business Assistance then link to Starting a Business). This document reviews each business entity recognized by Maryland, their formation, taxation and liability issues. The document will then go one to introduce other legal issues when doing business in Maryland. For further information regarding the laws relating to Maryland legal entity types, consult the Corporations and Associations Article of the Annotated Code of Maryland