Obtaining a Certificate of Compliance in Maryland

When you run a business, you’ll find there are many requirements that the state sets out that you must comply with. These requirements can involve submitting filings, making payments, and obtaining permits or licenses. A Maryland Certificate of Status (COS) is also known as a Certificate of Good Standing, Certificate of Existence, or Certificate of Compliance in other states. It allows you to show business partners, investors, and governmental agencies that your business has fulfilled these obligations.

Failure to maintain good standing can lead to specific negative consequences, such as penalties and late fees. It can also hurt your organization’s reputation and cause critical business delays.

In this guide, we’ll explain how to obtain a Certificate of Status, when you’ll be asked for one, and what types of businesses can receive one. We’ve also got resources for you and answers to some frequently asked questions.

What is a Maryland Certificate of Status?

A Certificate of Status is a legal document that’s issued by the Maryland Department of Assessments and Taxation verifying that a business is in good standing. This means that the entity is active, allowed to conduct business in the state, and in compliance with state laws.

Running a business requires a lot of multitasking. Sales, marketing, HR, legal, and similar things all take up time and attention. We know things can accidentally get overlooked or missed. ZenBusiness’s worry free compliance service can help your business stay in good standing. We alert you when compliance events and deadlines are approaching, as well as help you get your annual filings ready for submission.

What does a Certificate of Status confirm?

A Maryland Certificate of Status confirms that your organization is following the business-related rules and regulations of the state. This includes conditions such as:

• Your organization being active/in existence and authorized to do business in the state.
• Maryland annual reports and property tax returns (if applicable) having been properly filed.
• The existence of an active registered agent (known as a resident agent in Maryland).
• Any penalties having been paid.
• All payment for fees and franchise taxes being up to date.

The certificate will list a specific date and time of which your business is in good standing. It’s important to take note of this since it can determine how long the certificate is effective. We’ll discuss COS validity in more detail below.

Why might a business need a Maryland Certificate of Status?

The state doesn’t require businesses to have a COS on hand; it’s not a mandatory document. Some organizations choose to have a copy in their corporate records, as a COS can be a way of generating confidence in or creating legitimacy for new or small businesses.

However, you may need a Certificate of Status for administrative activities such as opening a business bank account, buying business insurance, or renewing certain permits and licenses. Additionally, it’s generally required when you’re establishing an agreement with another company or state or registering your business outside of Maryland.

If growing your business is in your plans — whether by securing more funding or selling part of it to an investor — you’ll likely be asked for one.

What Maryland entities can obtain a COS?

In general, only registered business entities such as corporations or Maryland limited liability companies (LLCs) can get a Maryland Certificate of Status. The other business types that require registration in the state are limited partnerships (LPs) and limited liability partnerships (LLPs). Because a good standing status requires a business to be active, any firm that has been closed will have a status of not in good standing.

Sole proprietorships and general partnerships aren’t required to register in Maryland and, as such, can’t qualify for a COS.

Government entities and special entities aren’t eligible for a COS and should contact the Department of Assessment and Taxation Charter Business Services division.

Unlike in some other states, certificates aren’t issued for a business’s trade name or a “doing business as” name.

How to get a Maryland Certificate of Status

Check your current compliance status

It’s a good idea to check your business’s current status before purchasing a COS. You can look this up on Maryland’s Business Express site using your organization’s name.

If your business isn’t in good standing, you’ll need to figure out what’s non-compliant (for example, outstanding taxes, unfiled annual report, or no active registered agent) and act accordingly.

Address any noncompliance issues

The state recommends addressing any issues before requesting a Certificate of Status. Many such issues can be resolved via the Maryland Business Express site; however, issues with the Maryland Office of the Comptroller or the Maryland Department of Labor will need to be handled directly with the relevant office. If your organization doesn’t have an active registered agent on record, you can file a resolution listing one.

If your business has lost the right to do business in Maryland and is no longer authorized to use its name — a status known as forfeited — check and correct the issues as described above. Next, you’ll need to file one of the following documents depending on your business type:

• Articles of Revival for a Maryland corporation.
• Articles of Reinstatement for a Maryland LLC.
• Certificate of Reinstatement for a Maryland LLP or LP.
• Foreign Corporation Requalification for a non-Maryland corporation.
• Foreign Re-registration for a non-Maryland LLC.
• Foreign Re-registration for a non-Maryland LLP.
• Foreign Re-registration for a non-Maryland LP.

Foreign (out-of-state) organizations will need to include a Certificate of Status from the state in which the business was originally formed along with the appropriate document listed above.

If your business has personal property or requires a license issued by a county, there may be additional actions required. In either of these cases, it’s best to reach out to the Maryland Department of Assessments and Taxation for help.

Request a COS

To obtain a COS online, search for your organization using Maryland’s Business Express entity search, follow the instructions, and submit the payment.

If you prefer using the mail, you can send a letter of request and a check or money order to the following address:

SDAT – Corporate Charter Division
301 W. Preston St., Room 801
Baltimore, MD 21201

COS Validity

The person, business, or organization that requests a Certificate of Status may set a validity period for the document. For example, a bank may only accept a certificate that’s no older than 45 days.

Since a Maryland COS includes a date and time of issuance, it’s best to confirm with the requesting party whether there’s a time frame requirement, rather than providing a certificate that won’t be accepted.

Conclusion

Compliance may not be simple to keep up with, especially when considering all the other aspects that make a business go round. At ZenBusiness, we understand that your business needs don’t stop after the business has been registered. ZenBusiness can help keep you in good standing with our worry free compliance service. With this service, we not only help keep your business in compliance, but we can also secure a Maryland Certificate of Status for you if you need one; you just pay the state fees. And, if you don’t have worry free compliance but still need a COS, our Certificate of Good Standing service can help.