Is a Maryland Resident Agent Required?
Before you can form a corporation, Limited Liability Company (LLC), Limited Liability Partnership (LLP), or Limited Partnership (LP) in Maryland, you need to appoint an official point of contact so that the Maryland State Department of Assessments & Taxation and others can get in touch with your business, especially for legal notices that must be delivered in person.
That person (or company) is called a resident agent, which is called a registered agent or statutory agent in some states.
Here I’ll explain what the resident agent is, their duties, the requirements to be one, and more.
Resident Agent Overview
A resident agent (also referred to as a registered agent or statutory agent in some states) is a person or company that is designated to be the official point of contact between the government and your business entity.
Only Maryland corporations, LLCs, LLPs, or LPs are required to appoint a resident agent. Sole proprietorships and general partnerships do not need one.
Resident Agent Duties
Under Maryland state law, Statute § 2-108, all registered entities must appoint and maintain a resident agent, which may (but doesn’t have to) be its place of business in the state of Maryland.
The agent’s primary role is to accept important legal documents on behalf of the business. This position is necessary because it ensures that the correct people are notified in the event of time-sensitive events such as service of process for lawsuits, garnishment notices against employees, notice of annual report renewal, and more.
If a resident agent isn’t appointed, there are several potential outcomes. A few of these include:
- Not Receiving Legal Notices – If the listed resident agent cannot receive legal notices, this lawsuit will still proceed. If a process server is unsuccessful in reaching the company’s resident agent, the court can proceed with the case. This could result in a judgment being placed against the business without the owners knowing.
- Penalties and Fees – By not maintaining a current resident agent, penalties and state fees can be levied against the entity and, in some cases, the business owners too. Once an entity is no longer in good standing with the state, the owners may lose their liability protection and are at risk personally.
- Administrative Dissolution – In Maryland, if the business doesn’t have a resident agent, the state can eventually dissolve the entity.
Common Questions About Maryland Resident Agents
Does Maryland require a registered agent?
A registered agent, which is officially referred to as a resident agent in Maryland, is required by the State Department of Taxes & Assessments – Charter Division when forming an LLC, LLP, LP, or corporation in Maryland.
What is required of a resident agent in Maryland?
A resident agent must be available during normal business hours at a specific address in Maryland to forward any service of process, notice, or demand pertaining to the entity to the appropriate individuals in the business.
Who can be a registered agent for an LLC in Maryland?
A registered agent in Maryland can be any resident of the state who is 18 years or older, a registered Maryland domestic business entity, or a foreign business entity authorized to do business in the state. An entity may not be its own agent.
The resident agent needs to have a physical street address (often referred to as a registered office or principal office) in the state of Maryland. This can be your home address, the address of a family member, an accountant or attorney, the address of the business, or a professional resident agent service. Any physical address in the state may be used, but PO Boxes and mail drop services are not acceptable since someone has to be available to sign for documents.
Provided one of the members or officers lives in Maryland, they can be the resident agent for the entity, however there are some reasons to hire a resident agent service.
Privacy – The address of the resident agent becomes public record and is available for anybody to see. This can be especially concerning if someone is doing business on the side, and they don’t want their employer to know about the business. Also, if the business is sued, the notice will be delivered to the address on file. This could mean employees, customers, or even neighbors witnessing the event. There is also the remote possibility of a vindictive litigant or upset customer showing up at your house.
Availability – Maryland requires the resident agent to be available at the principal address during regular business hours. The biggest issue with availability, especially if a home address is used, is if the agent goes on vacation or is otherwise away for some period of time and can’t be reached.
If the Business Expands to Additional Locations – If the business has a physical presence in multiple states (offices, warehouses, employees, etc.), a foreign entity registration will often need to be filed with those states. A resident agent will need to be appointed with a physical address in each state.
Due Date Reminders – Resident agent services provide annual report reminders and updates on any state requirements.
How much does a Maryland resident agent service cost?
Depending on the services provided, a commercial registered agent service typically costs between $100-$150 per year. Northwest Registered Agent is a popular service that charges $125 per year and offers several extras such as document scanning and mail forwarding and Harbor Compliance has a basic service starting at $99.
Some entity formation companies, like IncFile, includes registered agent service at no cost for the first year when you register your corporation or LLC with them.
How do you appoint a resident agent in Maryland?
A resident agent is required by the Maryland State Department of Assessments & Taxation when forming an LLC, LLP, LP, or corporation in Maryland.
The resident agent’s appointment is first made in the entity formation documents, but can be changed at any time by filing the Resolution to Change Principal Office or Resident Agent Form.
After filing the form, be sure to update LLC operating agreement or corporation bylaws with the new agent’s information.
Can a resident agent be changed in Maryland?
If the resident agent changes, the entity is required to file a change of resident agent.
A Resident Agent can be changed by submitting the Resolution to Change Principal Office or Resident Agent Form along with the filing fee to the Maryland State Department of Assessments & Taxes. This form can be filed through the Maryland Business Express website or mailing in the paper form.
Can a resident agent sign on behalf of an LLC?
Unless the resident agent is also authorized to sign on behalf of the entity, they are not legally allowed to sign.
