No matter where you’re setting up your business, you must understand your local laws. While federal laws governing businesses will affect you the same way no matter your location, states have unique and sometimes surprising regulations that can catch even the savviest business owner unaware if they don’t do their research.
The Old Line State is an ideal place to start your new company, whether you’re a first-time entrepreneur or a seasoned business owner starting a new venture. As you start your new business in Maryland, here are some of the most important laws and regulations you’ll need to account for to set yourself up for success.
Permits and Licenses
When setting up a Maryland business, your first step should be to visit the state’s one-stop portal for filing your permit and license applications. These are some of the most common applications you might have to fill out, depending on your business category and model. Maryland has many licenses and permits to consider, so make sure to check the website in case your business falls under some more obscure categories as well.
- State Business License- No matter what industry you’re in, you will almost certainly need this license to operate. Virtually all businesses must have a state business license, and other certifications are additional depending on the specific venture.
- State Trader’s License- If your business buys, sells, or resells goods, you’ll need to apply for this separate license. Most standard retail falls under this category because of the supply issue, although businesses that make their own goods may be exempt.
- Air Quality State Permit to Operate- This license applies to any business that has the potential to create air pollution. While this primarily applies to construction and manufacturing, restaurant owners should also be aware of this one, too—particularly if they plan to operate a smoker. Inspections may be necessary to determine how your business is classified.
- Airport Zoning Permit- This license has less to do with how your business operates and more to do with where it’s located. Before renting or purchasing any facility or land, check if your business will be located within an airport noise zone or zoning district. Those businesses require a special license and may have to abide by specific regulations for safety reasons.
- Certificate of Status- If your business files for a new license or permit, you’ll likely have to obtain this certification to submit along with your application, indicating that your business is up-to-date with all owed taxes, fees, and licenses. This certificate can easily slip under the radar of a busy business owner.
- General Permit for Storm Water Associated With Construction Activity- If you need to do construction to set up your business, make sure you have the permits associated with the necessary work. This permit covers any construction project larger than 1 acre if it has the potential to interfere with water drainage in the area.
- Fishing/Harvesting Permits- A common mistake business owners make is assuming this is a one-size-fits-all permit. In fact, Maryland is a heavy fishing state and individual creatures, including eel, crab, sea bass, and many others, are regulated separately. Businesses that will be harvesting them require specific permits.
Required Forms of Insurance
Obtaining insurance for your business is partially a personal decision, but some forms of insurance are legally mandated.
- Workers’ Compensation- Workers’ compensation insurance is required for most businesses and can be obtained from private insurers. Businesses without proper insurance can be fined up to $10,000, although you can apply to be self-insured if you’re interested in pursuing that route. These laws protect both your employees and your business by ensuring on-the-job injuries are covered and that your business is not liable for costs. Make sure to study Maryland workers’ comp laws in-depth before signing a contract.
- Commercial Auto Insurance- All vehicles in Maryland are required to have insurance. If you have a fleet of automobiles for delivery, construction, or other purposes, all need to be individually insured with automobile liability insurance, uninsured/underinsured motorist coverage, and personal injury protection. The state conducts random inspections of vehicles to ensure they are properly insured, and violations can be costly.
- Unemployment Insurance Taxes- While this is a form of insurance purchased by individual people and not businesses, business owners have to pay taxes to keep the program funded. The Division of Unemployment Insurance administers unemployment insurance, so new businesses should set up an account with them.
Study Your Local Laws
While permits and insurance are the most critical part of setting up a business, make sure to read up on all other state and municipal regulations. These can include zoning rules for specific commercial businesses, which vary by county and can be found here. For any local permits you might need beyond state licensing, look for your local Clerk of the Court.
Cover Your Bases Before You Launch
A missed permit or regulation can be a costly setback for a new business. That’s why doing as much research as possible to make sure you’re in the clear is a worthwhile investment of time and resources. Filing all your paperwork correctly will set your new Maryland business up for long-term success.