How To Start A Nonprofit In Maryland
To start a nonprofit in Maryland, you must file the Articles of Incorporation for a Nonstock Corporation with the Maryland State Department of Assessments and Taxation (SDAT). You can file the articles in person, online, or by mail. The articles of incorporation cost at least $170 in combined state fees (a $100 state filing fee, a $20 organization and capitalization fee, and $50 that goes to the Maryland Not-For-Profit Development Center Fund, though the state also charges additional fees for expedited processing and other services). Once filed with the state, your articles of incorporation officially create your Maryland nonprofit corporation, but truly preparing a nonprofit to pursue its mission involves several additional steps.
Starting a Maryland Nonprofit Guide:
- Choose your MD nonprofit filing option
- File MD nonprofit articles of incorporation
- Get a Federal EIN from the IRS
- Adopt your nonprofit's bylaws
- Apply for federal and/or state tax exemptions
- Apply for any required business licenses
- Open a bank account for your MD nonprofit
- Submit the MD nonprofit annual report
Maryland Nonprofit Filing Options
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Download the Maryland Nonprofit Articles of Incorporation. Fill out the form and submit to the state.
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MD Articles of Incorporation for a Nonstock Corp.
To incorporate a Maryland nonprofit, you must complete and file the Articles of Incorporation for a Tax-Exempt Nonstock Corporation with the Maryland State Department of Assessments and Taxation (SDAT). See the document below and click on any number to see what information is required in the corresponding section.
Your nonprofit’s name should contain “Corporation,” “Incorporated,” or “Limited” (or their abbreviations), and the name should be distinguishable from other organizations on record in the State of Maryland. You can do a business entity search at Maryland.gov to see if your nonprofit’s name is already taken.
If you are using Maryland’s form (the Articles of Incorporation for a Tax-Exempt Corporation), the form already includes a statement of purpose with the tax-exempt language required by the IRS. In that case, you only need to provide an additional sentence or two specifying your nonprofit’s purpose. If you’re writing your own Articles of Incorporation, you’ll need to include the IRS language yourself.
Include the Maryland street address (no PO Boxes) of your nonprofit’s principal place of business. When you hire Northwest as your Maryland registered agent, you can replace your Maryland address with ours.
List the name and Maryland street address of the individual or business authorized to receive services of process on behalf of your nonprofit. When you hire Northwest, our name and Maryland street address go here.
Maryland’s form includes a provision that your nonprofit “corporation has no authority to issue capital stock” (a particularly important provision for nonprofit’s seeking tax-exempt status). If you use Maryland’s form, leave this section as it is. If you’re writing your own Articles, be sure to include your own provision against issuing capital stock.
Identify your nonprofit’s initial directors (at least one), and specify how many directors your nonprofit will have once incorporated.
If you hope to obtain 501(c)(3) tax-exempt status for your nonprofit, you will need to show that you properly limited your activities to tax-exempt purposes recognized by the IRS. Roughly, this means staying out of politics and making sure your nonprofit’s income gets devoted exclusively (and perpetually) to tax-exempt purposes. If you’re using the form provided by Maryland for tax-exempt nonstock corporations, the form already contains the required IRS language.
Your Articles should close out with the signature(s) of your incorporators (the person or persons forming your nonprofit corporation), the signature of your registered agent, and the filer’s return address. When you hire Northwest to form your nonprofit, the return address can be ours, and we’ll serve as your nonprofit’s incorporator and registered agent.
How Much Does It Cost To Incorporate a Maryland Nonprofit?
For basic filing, you’ll pay a $100 state filing fee and a $20 organization and capitalization fee, along with an additional $50 that goes to the Maryland Not-For-Profit Development Center Fund. If you want to receive notice in the mail that you’re filing went through, you’ll pay an additional $5 return mail fee. If you want to speed up the processing time from 4-6 weeks to 3 days, you’ll pay a $50 expedite fee. And if you want to file online and/or pay with a credit card, you’ll pay a 3% credit card processing fee (usually around $6).
Starting a nonprofit in Maryland, in other words, comes with a dizzying number of options and potential fees, so there’s no shame in getting a little outside help. Hire Northwest to form your Maryland nonprofit and the total cost, which includes a full year of registered agent service, is $452 for 3 day filing, a total that includes every fee listed above.
How Long Does It Take to Start a Maryland Nonprofit?
Maryland provides a whirlwind of processing times for different fees. If you hand deliver your documents between 8:30 a.m. and 4:30 p.m. to the Baltimore office of the State Department of Assessments and Taxation and pay a $50 expedite fee (in addition to the other filing fees), Maryland will process your articles of incorporation that day. If you file online or by mail and pay a $50 expedite fee, Maryland will process your articles within a few business days of receipt. Lastly, if you mail in your unexpedited articles, you can expect a wait time of around 4-6 weeks.
When you hire Northwest to incorporate your Maryland nonprofit, we’ll file your documents online and typically get your articles processed within three business days.
Does a Maryland Nonprofit Need a Registered Agent?
Yes, your nonprofit corporation needs to appoint a Maryland registered agent. Often called a “resident agent” in Maryland, your registered agent is the person or business authorized to receive services of process (legal notices and lawsuits) on your behalf. You can be your own registered agent, appoint someone you know, or hire a commercial registered agent service like Northwest.
We don’t recommend doing the job yourself. Your registered agent’s Maryland street address must appear on your nonprofit’s Articles of Incorporation, a document that goes into the public record. This means less privacy, more junk mail, and the possibility of unannounced solicitors knocking at your door. A registered agent also must be available at this street address during normal business hours. If you appoint yourself, you can’t hold lengthy meetings, travel to meet with potential donors, or do pretty much anything else that might prevent you from being available to accept services of process. It’s simply difficult to manage and grow a nonprofit corporation while stuck at a desk.
These problems evaporate when you sign up for Northwest’s registered agent services. You’ll get to use our address in place of yours on your nonprofit’s Articles of Incorporation, and we’ll be the ones waiting at our desks all day. If and when we receive a service of process on your behalf, we’ll scan it and send it to you on the same day.
Get a Federal EIN from the IRS
Do I Need A Tax ID Number (EIN) For A MD Nonprofit?
Definitely. A federal employer identification number (EIN) is crucial to managing your nonprofit’s finances, applying for 501(c) tax-exempt status with the IRS, registering as a Maryland charity, and opening a bank account in your nonprofit’s name (among numerous other financial necessities). You can apply for an EIN after the State Department of Assessment and Taxation approves your nonprofit’s Articles of Incorporation.
The IRS accepts EIN applications online. But if you don’t have the time or don’t want to deal with the IRS, you can add our convenient EIN service for an additional fee when you hire Northwest.
Hold Your Organizational Meeting & Adopt Bylaws
Does A Maryland Nonprofit Need Bylaws?
Maryland requires a nonprofit corporation to adopt bylaws at its first official meeting. You can hold this meeting before or after submitting your Articles of Incorporation, but you should do so before applying to the IRS for 501(c)(3) tax-exempt status. The IRS only wants to deal with a fully formed nonprofit, and you you’ll also include your bylaws when applying for certain Maryland state tax exemptions. In the official sense, in other words, bylaws are must.
But your nonprofit would want bylaws even if they weren’t required by the state. Bylaws are your nonprofit’s internal rules, and without them your nonprofit wouldn’t have consistent answers to questions like “Will we have voting members?”, “How does someone become a director?”, and “What are the vice-president’s responsibilities?” Hire Northwest, and you won’t have to write your bylaws from scratch. We provide a free template for writing nonprofit bylaws, as well as numerous other free nonprofit forms, to get you started.
Apply for Federal and/or State Tax Exemptions
Will My Maryland Nonprofit Be Tax-Exempt?
Unfortunately, incorporating your Maryland nonprofit doesn’t mean your organization is automatically tax-exempt. To obtain tax-exempt status, you’ll first need to apply for federal tax-exempt status with the IRS. This involves submitting an Application for Recognition of Exemption and waiting around 6 months for the IRS to finish examining your nonprofit’s finances, organization, and purpose. There are more than two dozen types of exempt organizations, but most nonprofits seek 501(c)(3) status for public charities and private foundations. If your nonprofit intends to go this route, make sure your articles of incorporation include the specific language and tax-exempt provisions required by the IRS.
If or when your Maryland nonprofit corporation obtains 501(c)(3) status from the IRS, you can register with the Maryland Comptroller’s office and apply for the available state tax exemptions. Visit our Maryland state tax exemptions page for details.
Obtain Maryland Licenses and Tax Accounts
Does A Maryland Nonprofit Need A Business License?
Maryland doesn’t require businesses to purchase a single statewide business license, but most Maryland counties license certain business activities, and some cities and towns add on their own licensing requirements. Contact your county’s Clerks of the Circuit Court for details. Nonprofits that have obtained federal tax-exempt status from the IRS are not required to obtain business licenses.
Do I Have To Register My Nonprofit As A Charity In Maryland?
Most organizations that solicit charitable donations in Maryland must register as a charity with the Maryland Secretary of State’s Charitable Organization Division, though the registration and renewal fees, the forms to file, and the additional paperwork required vary depending on how much your Maryland nonprofit receives in contributions each year. In any case, you should wait to solicit donations until after the Charitable Organization Division has approved your registration.
Here are the general fees to register and renew your Maryland charity:
|Annual Charitable Contributions||Registration & Renewal Fees|
|Less than $25,000||$0|
|$25,000 – $50,001||$50|
|$50,001 – $75,000||$75|
|$75,001 – $100,000||$100|
|$100,001 – $500,000||$200|
|$500,001 or more||$300|
Visit our Maryland Charity Registration page for a detailed discussion of the forms, fees, and paperwork required to maintain a nonprofit charity in Maryland.
Open a Bank Account for Your MD Nonprofit
To open a bank account for your Maryland nonprofit, you will need to bring the following items with you to the bank:
- A copy of your Maryland nonprofit’s articles of incorporation
- A copy of your nonprofit’s bylaws
- Your Maryland nonprofit’s EIN
It’s usually wise to call your bank ahead of time to check its requirements. Some banks may require you to bring a resolution authorizing you to open a bank account in your nonprofit’s name (particularly if your nonprofit has several directors and/or officers).
Submit the MD Nonprofit Annual Report
What Is The Maryland Nonprofit Annual Report?
Maryland requires nonprofit corporations to file an annual report updating their contact and organizational information with the state. However, if your nonprofit owns, leases, or uses personal property located in Maryland, you’ll need to file the combined Annual Report and Personal Property Tax Return form instead.
Both forms are available at the Maryland Department of Assessments and Taxation’s website, there are no filing fee for nonprofits, and both deadlines are April 15th each year. You can file online or by mail.