Business Law Maryland

BUSINESS LAW

FORMS OF BUSINESS ORGANIZATION

A business organization in Maryland may be of the following types:

A sole proprietorship requires no legal entry formalities except compliance with State and local licensing and taxation requirements.

A general partnership is association of two or more persons to carry on as co-owners, a business, for profit.
A partnership exists if a contract to act as partners exists, even if it is not called a partnership.
A written agreement is not necessary to form a general partnership.

A limited partnership has one or more general partners and one or more limited partners.
Limited partners are liable only for the amount, which they invest in the limited partnership.
All limited partnerships are required to file a certificate of limited partnership with the State Department of Assessments and Taxation.

A limited liability partnership may be formed by any existing legal partnership without dissolving or otherwise changing its form of organization.
It generally protects a partner from personal liability for debts and obligations of the partnership arising from negligence, wrongful acts, or omissions of the limited liability partnership.
To create one limited liability partnership, a certificate of limited liability partnership that includes the name, address, and purpose of the limited liability partnership must be filed with the State Department of Assessments and Taxation.

A limited liability limited partnership protects the assets of general partners from judgments against other general partners.
A limited partnership may register as a limited liability limited partnership by including in its certificate of limited partnership the purpose of the limited liability partnership and by including in its name the words "limited liability limited partnership".

A joint venture is a business undertaking by two or more persons engaged in a single defined project.
There are no formal registration requirements for joint ventures.

A domestic corporation is organized and exists under the laws of this State.
A foreign corporation is organized under the laws of the United States, the laws of another state, a territory, possession, or district of the United States, or a foreign country.
To form a corporation in Maryland, one or more adult individuals must sign and file articles of incorporation with the State Department of Assessments and Taxation and pay all relevant taxes and fees.
When the department accepts the articles of incorporation for record, the proposed corporation becomes a corporate body under the name and subject to the purposes, conditions, and provisions stated in the articles.
Before conducting business in Maryland, a foreign corporation must qualify or register to do business with the State Department of Assessments and Taxation.
Special types of corporations in Maryland include professional service corporations, non-stock corporations, private foundations, and cooperatives.

A limited liability company is an unincorporated business organization with limited duration and limited liability for all members.
Incorporated under Maryland law, it may conduct activities in any state related to any lawful business or activity, whether or not for profit, except the business of acting as an insurer.
To create a limited liability company, articles of organization must be executed and filed for record with the State Department of Assessments and Taxation.

A real estate investment trust is an unincorporated trust or association in which property is acquired, held, managed, administered, controlled, invested, or disposed of for the benefit and profit of any person who may become a shareholder in the real estate investment trust.
To create a real estate investment trust, a declaration of trust must be filed for record with the State Department of Assessments and Taxation.

A statutory business trust is an unincorporated business, trust, or association created by a trust instrument uader which:

property is or will be held, managed, administered, controlled, invested, reinvested, or operated by a trustee for the benefit of persons as are or may become entitled to a beneficial interest in the trust property; or
Business or professional activities for profit are carried on or will be carried on by a trustee for the benefit of persons as are or may become entitled to a beneficial interest in the trust property. To create a statutory business trust, a certificate of trust must be filed with the State Department of Assessments and Taxation.