Foreign LLP Registration and the Resident Agent in Maryland

Foreign here means formed outside Maryland, whether in another state, a territory or another country. Registering as a foreign limited liability partnership does not change how the partnership is organized at home. It is permission to operate in the state, and Maryland wants evidence that the partnership remains in good standing at home.

The governing law is Corporations and Associations (C&A) section 9A-1101, and the act is called registration. SDAT's forms page lists the paper form as Foreign Limited Liability Partnership Registration, though the PDF is headed Limited Liability Partnership Registration. Neither name comes with a form number. SDAT's online portal handles foreign corporation and LLC filings but has no foreign LLP row, so this registration travels on paper.

Under section 9A-1101(a), a foreign LLP registers before it begins any business here, interstate, intrastate or foreign alike. The phrase is wide. It reaches work done across the state line and work done inside it.

Section 9A-1108(a) then says that, in addition to any other activities that may not qualify, eight activities do not amount to doing business. Taken together they are defending, settling or maintaining a legal claim of any kind, administrative and arbitration matters included; partner or agent meetings and similar internal affairs; keeping bank accounts; a one-time sale unconnected to similar ones; and the four property steps that follow a mortgage default (foreclosing, taking title, holding and renting the property, and selling it).

Income-producing property is a trigger

Subsection (b) reverses the usual assumption. A foreign LLP holding Maryland land, buildings or tangible equipment that earns income, other than property it acquired through those foreclosure steps, "shall be considered to be doing business" here. A firm that also owns a leased-out office building in Baltimore is covered. Commerce across state lines is not on the exclusion list. Where your facts fall between the list and the property rule, have a Maryland attorney look at them.

The charge is $100, set by C&A section 1-203(b)(3)(i), which prices registrations for foreign limited partnerships, limited liability partnerships and limited liability companies alike. The SDAT form omits the amount, so confirm it with SDAT before you mail a check made out to Maryland's Department of Assessments and Taxation.

Paper filings go to the Charter Division at 700 E. Pratt Street, Suite 2700, Baltimore. According to SDAT's processing page, a filing with no expedite waits up to eight weeks for review, and an expedited one is reviewed within 7 to 10 business days. Expediting costs an additional $50 under the statute.

What the form asks

• The partnership's full legal name in its home jurisdiction
• A different name for Maryland, if you want one. It must include "Limited Liability Partnership" or "LLP"
• Where and when it was formed, and its address there
• What kind of business it will carry on here
• A Maryland resident agent's name and street address, and the agent's consenting signature
• A yes or no on prior Maryland business, with a $200 penalty added if yes
• The signature of an authorized person

The statute adds the general character of the business and the proof of good standing. If a statement was false when made, or facts change later, the partnership must promptly file a corrective certificate signed by an authorized person (section 9A-1104).

SDAT requires it. The form's heading says that a non-Maryland entity's first filing must be accompanied by documentation of existence from the state of formation, generally the equivalent of a certificate of status, issued within the 60 days before filing. The statute puts it as acceptable proof, in SDAT's judgment, of good standing in the state or country where it is organized.

You order this from the home state. Not every state says "certificate of status," so ask for whichever document shows the partnership exists and is in good standing. With only 60 days to work with, order it when the form is nearly ready to sign rather than at the beginning of the project.

A name different from the home name is allowed (section 9A-1103). SDAT checks the Maryland name against other entities and reserved or registered names on its records, and it must be distinguishable. Use the form's second line for a Maryland-only name, and keep the LLP designator in it. Reserving a name for 30 days costs $25.

The Maryland term is resident agent. C&A section 1-101 defines it as a person residing in the state or a corporation, LLC or limited partnership formed in Maryland. A Maryland street address is required, with no P.O. box, and the agent signs a consent on the form. An out-of-state partnership cannot be its own agent under that definition.

Name no one, or an agent who cannot be found for service, and SDAT is appointed instead. Service on a resident agent is effective service on the partnership. A later change of agent or agent address uses SDAT's one-page resolution form and a $25 fee, and the incoming agent signs as well.

A registered foreign LLP submits Form 1 by April 15 every year (Tax-Property section 11-101). Form 1 combines an annual report with a personal property return. The annual report fee is $300. The return has no fee, and an entity whose Maryland personal property cost less than $20,000 in total owes no personal property tax. Send it online, or mail it to SDAT's Baltimore post office box.

A late report brings a penalty starting at $30 for 1 to 15 days, $40 for 16 to 30 days and $50 beyond that. The first amount is capped at $500, with 2% more for each extra 30 days, and SDAT may reduce it for good cause. To get until June 15, request an extension online by April 15, or on paper by March 15 with $20.

Forfeiture and cancellation

SDAT may forfeit a foreign LLP's right to do business when a report or late penalty goes unpaid and a written demand then sits for 30 days. The forfeiture takes effect 15 days after written notice, and after that the partnership stands as though no license to operate here had ever been issued (section 9A-1111).

To withdraw from Maryland voluntarily, the partnership files SDAT's Certificate of Cancellation of Foreign Limited Liability Partnership Registration. The base fee is $0 and expedited review is $50. Cancelling does not end SDAT's authority to receive service on claims from your Maryland business. The form's wording is that of a limited partnership, so read it with that in mind and ask SDAT if a signature line is unclear.

Section 9A-1106 lays out the consequences. A partnership that does business in Maryland without registering has no standing to maintain a suit in any Maryland court until the penalty is paid and it either registers or stops doing business. The penalty is $200, assessed by SDAT, and it can be cut or waived for good cause. The registration form asks about earlier Maryland business, and a yes requires the $200 to accompany the filing.

Every member of the partnership, and every agent who carries on the business, is guilty of a misdemeanor and can be fined up to $1,000 after conviction. The Attorney General may also sue to restrain the partnership from operating here (section 9A-1107).

The partnership's contracts and acts are not invalidated, and defending a suit against it remains possible. Unregistered business also makes SDAT the partnership's agent for service on claims from that business.

For a limited liability partnership, Mainstay Filing provides the resident agent only. Mainstay Filing charges $149 annually, flat, and renewal is the same amount. The agent's Maryland address goes onto your registration and into the public record. Papers served at that address are scanned and forwarded to you the same day they arrive, free. For government mail, the first three items every year are scanned at no charge.

The partnership or its lawyer submits the registration to SDAT itself. Should another agent be on record, Mainstay Filing files the change and bills the state's change fee to you at cost. Details are on the Maryland registered agent page. Mainstay Filing is no law firm; whether your partnership's activities require registration is a question for a Maryland attorney.