Think of all the people you communicate with regularly to run your LLC. Business partners, employees, banks, lawyers, and financial advisors all probably come to mind. But what about the state? It may not be at the top of your list, but running a successful LLC in Maryland requires consistent interaction with the state.
Formation documents, business information changes, lawsuits, professional licenses, and Annual Reports – all of these (and more) require you to work with state agencies. The good news is that you don’t need to do it yourself.
Introducing the resident agent. A Maryland resident agent is an intermediary for your LLC, a person or company that handles your communication with the state. They’re a vital part of any LLC’s success. Before you file your Articles of Organization, you’ll need to have a designated resident agent. How? Why? Who? Read on to find out.
Special Offer: You can get a free registered agent service and have the LLC formation paperwork filed for you by hiring an online LLC service. While there are a lot of options available and LegalZoom is the most well known, two of the top options that offer excellent prices and features are IncFile and ZenBusiness.
What is a Maryland Resident Agent & is it Necessary?
An LLC cannot be formed or do business in Maryland without first having a resident agent on file with the Secretary of State. This is required by law and the penalties can be serious. Maintaining a resident agent doesn’t just keep you in good standing. It also provides an important service.
Think of your resident agent as your ambassador to the state, handling all your LLC’s important legal, tax, and compliance information. This can either be an individual, company or resident agent service, as long as they meet the state’s requirements (see below) and consent to the appointment by signing the Articles of Organization.
As soon as they’re appointed, your resident agent must be consistently available in Maryland to receive and act on mailed documents and service of process. Here’s how the Articles of Organization defines the role:
Ensure that you have a valid resident agent on file at all times, because the state isn’t messing around – it will administratively dissolve your LLC if it goes more than 30 days without an agent.
What are the Requirements of a Resident Agent?
The state doesn’t have a lengthy list of restrictions on your who can serve as your resident agent, but it does have a few, and they’re inflexible. They state that your agent must:
- Be an individual Maryland resident or a business entity authorized to do business in Maryland.
- Have a physical address in Maryland (no P.O. boxes allowed)
- Have a mailing address in Maryland (can be identical to the physical address)
- Be at least 18 years old
You can even appoint yourself or one of your LLC’s members to serve as the resident agent. However, an LLC cannot be its own agent.
No matter who you choose, you’ll need to include their information on your Articles of Organization. Here’s a screenshot from the form:
When you’ve got potential options for your resident agent, review each one to make sure that they meet these requirements. If they do, you’re good to go! If not, you’ll need to keep looking.
Who can be a Resident Agent in Maryland?
Maryland’s resident agent requirements are pretty broad, so you’ll have no shortage of options. On top of that, your agent can be either an individual or a professional service. But think carefully before choosing, because each option has its own pros and cons. Let’s take a closer look.
You may choose to appoint a single person as your resident agent. Some LLC owners take on resident agent duties themselves. Others appoint one of their partners or managers. Some will even appoint a family member. As long as the proposed agent fulfills the state’s requirements, they’re a valid option.
In addition to being a Maryland resident, your agent must not currently be establishing residency or receiving benefits in another state, even if that residency is still forthcoming.
Some smart resident agent choices include attorneys, accountants, or other LLC partners, people who understand the ins and outs of business operations.
- Convenience – Having familiarity and mutual trust with your resident agent is extremely beneficial, and appointing an acquaintance can provide both. Plus, you’ll always know how to contact them.
- Cost – Hiring someone you know often won’t cost a dime. It’s certainly cheaper than a professional service.
- Scheduling – Part of a resident agent’s duty is being consistently available to receive mailed documents and service of process. If your agent goes on vacation or moves out of state, it will throw a wrench in your plans.
- Punctuality Risks – Some state communications and filings are very time-sensitive. If your agent is unavailable when documents are delivered, it could slow down the entire process and put you at risk for late fees and penalties. Even worse, a friend or family member could lose or misplace a document. So if you’d rather not interrogate Aunt Louise about the location of a particular tax form, you might consider using a resident agent service instead.
Resident Agent Service
If safety and reliability is your goal, hire a resident agent service. A business acting as your resident agent must be either a domestic entity in Maryland or a foreign entity that has foreign qualified in Maryland.
- Privacy – Some documents delivered to your resident agent will contain sensitive information. Do you want details about your lawsuit or taxes lost out there in the world? Definitely not. A friend or family member might misplace these documents, but a professional service will not. Plus, in Maryland, all resident agent names and addresses are available to the public. This might make an individual uncomfortable, but hiring a company will keep this personal information off the record.
- Reliability – Handling and processing time-sensitive documents is a resident agent service’s specialty, its area of expertise, its main game. Hire a professional service and you can be sure that your filings will be submitted properly and punctually, so you’ll never have to deal with late fees or other penalties.
- Location – Many resident agent companies offer service in most or all 50 states, so if business is booming and you decide to expand outside Maryland, you won’t need to find a new agent for each state.
- Cost – There’s no getting around it – hiring a service costs more than appointing an individual who’s willing to do it for free. However, for a reasonable price (roughly $100/year), you’ll receive premium services. Taking your car to a mechanic costs more than letting your neighbor try to fix it, but the mechanic gives you peace of mind that the job will get done right, and that may very well be worth the cost.
All of the other steps in the LLC formation process will keep you busy, but take some time to ensure you find a resident agent that fits with your business model, goals, and values. Do this, and your LLC will reap the benefits for years to come.
How to get a Free Resident Agent in Maryland
Here’s a pro tip: you can get the reliability of a resident agent service and the cost-effectiveness of an individual. The best of both worlds. When you hire certain LLC services to start your business, they’ll throw in free resident agent service.
How it Works
Hire a company like IncFile or ZenBusiness to form your Maryland LLC. In addition to taking care of your Articles of Organization and other formation requirements, they will automatically include a resident agent. It’s a great two-for-one deal.
And an LLC service is pretty affordable – $100 for the Maryland LLC formation fee, plus a $49 or $79 service fee. That’s great value for the number of benefits you receive. Some services will even cover and consolidate your LLC formation costs.
Take this route and you’ll sweep all formation paperwork and resident agent duties off your plate. Plus, to keep track of everything, these services provide user-friendly online dashboards, so you can follow everything they’re doing to keep your LLC in good standing.
Resident Agent Changes and Resignation
You may have a wonderful resident agent, someone who takes care of everything efficiently and who you trust completely. But you know what they say: all good things must come to an end. At some point in the life of your LLC, you may need to change your Maryland resident agent.
Make this change through the Maryland Business Express website or by mailing/hand-delivering a Resolution to Change Principal Office or Resident Agent form to:
State Department of Assessments and Taxation, Charter Division
301 W. Preston Street; 8th Floor
Baltimore, MD 21201‐2395
Of all the reasons you might need to change your resident is if your current agent resigns.
Your resident agent has no legal obligation to inform you before resigning. However, they will be required to retain resident agent duties for 30 days after submitting their official resignation. This will give you ample time to find a replacement.
But if that 30-day window closes and you don’t have a new agent, you have 30 more days to appoint one. If you don’t, the state will administratively dissolve your LLC.
Have Questions or Concerns?
This guide contains almost everything there is to know about Maryland resident agents. However, you might have a unique situation that requires additional information. Reaching out to the Department of Assessment and Taxation is easy, and they’ll have the answers you need. Here’s how to go about it:
Visit Their Website
The Department of Assessment and Taxation Business page and the Business Resources page of Maryland.gov have plenty more information on the LLC formation process.
Give Them a Call
If you’d prefer to call, reach out to their Baltimore office at (410) 767-1184. If you’re outside the Baltimore area, call (888) 246-5941 instead.