How to Get a Maryland Business License

Do you need a business license in Maryland?

Most Maryland businesses need a business license. Whether you need local, state, or federal business licenses depends on your location and the nature of your business. 

Maryland state

Maryland requires most businesses to have a business license to operate in the state. 

Types of Maryland business licenses include the following:

• Trader’s license: Applicable businesses that buy and sell goods will need to obtain a trader’s license. 
• Eastern Shore slot machine license: This license is for certain organizations that run slot machines on the Eastern Shore’s nine counties.
• Chain store license: Businesses that operate two or more retail stores under the same ownership or management in Maryland need to have a chain store license.
• Scrap metal processor, junk dealer, and agent license: Entities or individuals that buy, sell, or barter for scrap metal or junk must obtain a scrap metal processor, junk dealer, or agent license.
• Peddler’s license: The Maryland State Peddler's License Law requires peddlers or hawkers who sell goods while traveling in the state to obtain a peddler’s license before operating.
• Vending machine license: Anyone who sells products through a vending machine in Maryland must have a vending machine license. 
• Construction license: Contractors need a construction license to enter into commercial contracts.
• Storage warehouse license: Businesses that provide storage warehouse space for a fee need a storage warehouse license. 
• Micro market license: Anyone running a micro market must have a micro market license.

Depending on your industry, you may also need to acquire occupational and professional licenses.

You can check with the Maryland Department of Labor or call the Maryland State License Bureau at 410-260-6240 to find out about state licensing requirements for your specific business. 

Local

Figuring out exactly what local licenses or permits your particular business needs can be time-consuming, as requirements can vary by location, and there may be overlap between state and federal requirements.

For instance, anyone wishing to run a bed and breakfast in Annapolis must get a city-level bed and breakfast license in addition to obtaining any necessary state-level licenses, such as a sales and tax use license.

Check with your local Clerk of Court to find out your local license requirements. 

Federal

Businesses in certain industries may be required to obtain federal licenses. For example, businesses that sell firearms must obtain a federal license from the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF). 

How to get a business license in Maryland in 7 steps

Getting a business license in Maryland can involve setting up your business, getting an employer identification number (EIN), applying for tax accounts, and applying for necessary licenses and permits on the local, state, and federal levels. 

Step 1. Set up your business

You’ll need to set up your business before applying for a Maryland business license. The steps for setting up a Maryland business can include choosing a business structure, naming your business, and registering your business with the Maryland Department of Assessments and Taxation (SDAT).

Popular forms of business organization include the following:

• Sole proprietorships
• Partnerships
• Limited liability companies (LLCs)
• Corporations

The name you choose for your business should be distinctive and comply with Maryland business naming guidelines. You can check Section 1-502 of the Corporations and Associations article of the Maryland Code to find business naming requirements for Maryland corporations and LLCs. 

Once you’ve chosen your business structure and decided on a name, you can register your business online via the Maryland Business Express online portal. 

You can register the following business types online:

• Sole proprietorship
• General partnership
• Maryland LLC
• Foreign LLC
• Maryland stock corporation
• Maryland tax-exempt nonstock corporation
• Maryland religious corporation
• Maryland close corporation
• Foreign corporation

If your business type is not listed above, you can contact the SDAT for more information. 

Step 2. Get an EIN 

The IRS requires businesses that intend to hire employees or those structured as LLCs, partnerships, corporations, or tax-exempt organizations to get an EIN.

You’ll need an EIN to hire employees, pay taxes, change your business structure or ownership, or administer certain trusts, retirement plans, or estates. 

You can apply for an EIN for free on the IRS website, or use an online EIN service.

Step 3. Apply for tax accounts 

The types of tax accounts you need to apply for depending on your industry and business activities.

New businesses can file a Combined Registration Application (CRA) online for the following types of tax accounts:

• Sales and use tax license. This license is necessary if you make sales and collect sales tax in Maryland.
• Employer’s withholding tax account. This account is for Maryland employers who must withhold income tax.
• Unemployment insurance account. Employers who are subject to the unemployment insurance law need an unemployment insurance account. 
• Admissions and amusement tax account. Businesses that charge admission are required to have an admissions and amusement tax account. 
• Tire recycling fee account. This account is for businesses that sell tires in Maryland.
• Transient vendor license. Anyone who makes sales at roadside or temporary locations in Maryland needs a vendor license.

The CRA also serves as initial registration for businesses that sell fuel, alcohol, or tobacco, or operate an Uber, Lyft, or Sidecar business.

You can find out more about different kinds of tax accounts on the Maryland Comptroller’s Information for Business Taxpayers website.

You can get a physical copy of the CRA by visiting one of the Maryland Comptroller’s offices.

Step 4. Apply for state licenses

You can apply for state business licenses by contacting your local Clerk of the Circuit Court. If you are a first-time applicant, you are required to register with the SDAT before contacting your Clerk of Court.

The Maryland OneStop Portal enables users to browse and register for state-level licenses and permits. You can browse by professional, organizational, or personal licenses, or by state agencies. 

Step 5. Obtain a trader’s license

Most businesses must obtain a trader’s license and open a sales tax account before they can sell goods in Maryland.

However, some businesses are not required to have a valid trader’s license. 

Exceptions to the law include the following:

• Growers
• Manufacturers
• A private individual who sells personal effects on his or her own property (as long as only one sale is conducted within a period of 14 consecutive days per year). 
• Businesses selling goods in shows put on by certain entities, such as those promoted by a volunteer fire department or a model train collectors' association 

Contact the Clerk of Circuit Court to find out how to get a trader’s license.

Step 6. Apply for local permits 

Depending on your location and the nature of your business, you may need to apply for local licenses or permits. Contact your local Clerk of the Court for info on state and county licenses or your county’s office of inspections, licenses, or permits for local licensing requirements. 

Step 7. Apply for federal licenses

Businesses in certain industries must acquire a license from a federal agency before engaging in business activities. For example, agriculture businesses or businesses that sell guns or alcohol must obtain a federal license. 

After getting your Maryland business license

It’s important to keep track of renewal dates and comply with any additional requirements to ensure your business license remains valid.

For instance, if you hold a license issued by any of the following state agencies, you must file necessary tax returns and pay all state taxes due (or set up a payment plan) before renewing your license:

• Department of Labor, Licensing and Regulation
• Comptroller of Maryland
• Clerks of the Circuit Court
• Department of Health and Mental Hygiene
• Motor Vehicles Administration 
• Department of Natural Resources
• Department of the Environment

In addition to keeping your business license up to date, you should ensure your license is displayed prominently to avoid fines or penalties. 

Getting an MD business license the easy way

Finding out exactly what licenses your business needs and the steps you need to take to stay compliant can be a hassle. Using an online business license management service can help you reclaim time spent on compliance research so you can focus on building your business.

LegalZoom’s business license service identifies and manages your required business licenses, saving you time and reducing stress. We provide a customized summary of the local, state, and federal business licenses your business needs, as well as ongoing notifications about license requirement updates and renewal deadlines. 

FAQs

What should I do before getting a business license? 

The following steps will help ensure you’re ready to get a Maryland business license:

• Choose a business structure 
• Conduct a Maryland business search  
• Register your business
• Obtain an EIN
• Apply for Maryland tax accounts
• Contact relevant local, state, and federal license departments 

How much is a business license in Maryland?

The cost of a business license in Maryland depends on the type of license you need.

For example, the cost of a trader’s license is determined by a business’ inventory value. You can download a Declaration of Inventory form to determine the price of your license. 

License fee information can be found in the Code of Maryland, Title 17, Miscellaneous State Business Licenses.

How long does it take to get a business license in Maryland?

The amount of time it takes to get a business license in Maryland depends on the license type.

For instance, most Maryland Alcohol, Tobacco, and Cannabis Commission (ATCC) license and permit applications take 30 to 60 days to process.   

What happens if I don’t pay the required license fees?

If you don’t pay the required license fees, you run the risk of losing your business license. 

What if I don’t get a required license on time?

If you don’t get a required license on time, you may face penalties.

For instance, if you are required to get a business license from the Maryland Department of Labor and don’t get the license on time, you may be charged a late fee. Section 1-206 of the Business Regulation article of the Maryland Code details how late fees are calculated.