How to Dissolve an LLC in Maryland (2026)

To dissolve an LLC in Maryland, file Articles of Cancellation with the State Department of Assessments and Taxation (SDAT), and the filing itself is free, Maryland charges a $0 fee for non-expedited Articles of Cancellation (expedited is $50). You file by mail. But Maryland has a uniquely punishing feature worth understanding: unlike most states, it does not administratively dissolve neglected LLCs. Instead, a dormant Maryland LLC falls into "forfeiture status" and keeps accruing the $300 annual report fee plus penalties indefinitely, so formally canceling matters far more here than almost anywhere else.

Here's the full process and the Maryland-specific specifics.

Maryland LLC dissolution at a glance

Step 1: Vote to dissolve and document it

Check your operating agreement for the dissolution procedure and document member approval in minutes or written consent, Maryland expects this recordkeeping. The documented decision is the basis for the cancellation. Between dissolution and the final cancellation, members can choose to wind up; an LLC may even revoke its dissolution before final cancellation if members decide to continue.

Step 2: Bring annual reports and personal property returns current

Handle this before filing, because SDAT requires the entity to be in good standing to accept the cancellation. Maryland's annual filing is the combined annual report and personal property return, with a $300 fee, due April 15. If you've missed years, you must file the outstanding returns and clear the balance before SDAT will process your cancellation. Check your status; if you're behind, the catch-up comes first.

Step 3: Wind up the business and settle debts

Wind up the LLC's affairs: notify known creditors (Maryland law expects notice to creditors, by registered mail, before filing Articles of Cancellation if there are known creditors), pay or provide for the company's debts, and distribute remaining assets to members, creditors first. Distributing assets ahead of creditors can create personal exposure.

Step 4: Handle final taxes

File your final Maryland and federal returns, marked final, including the final-year personal property return, and close any state tax accounts (sales-and-use, withholding) with the Comptroller of Maryland. Closing your tax accounts is a separate action from the SDAT cancellation; the Comptroller won't know you've closed unless you tell them.

Step 5: File the Articles of Cancellation

File the Articles of Cancellation with SDAT, $0 for non-expedited processing (mailed; online filing isn't available for this form), or pay $50 for expedited handling. Mail the form to SDAT's Charter Legal Department in Baltimore; if you want a processed copy returned, include it in duplicate with a return envelope. Non-expedited processing typically takes several weeks. The LLC continues to exist legally until SDAT accepts the cancellation.

Step 6: Close accounts, licenses, and registrations

Finish by canceling local business licenses and permits, closing business bank accounts, canceling the EIN with the IRS by letter, and withdrawing any out-of-state registrations.

The Maryland wrinkle: no administrative dissolution, so the meter never stops

Maryland's defining feature is the opposite of a convenience, and it's the single most important thing to understand. In most states, if you stop filing annual reports, the state eventually administratively dissolves your LLC, which at least stops new fees from accruing. Maryland does not do this. A neglected Maryland LLC instead falls into "forfeiture status," and it keeps accruing the $300 annual report and personal property return fee, plus late penalties, indefinitely. There's no administrative dissolution to ever close it out for you.

That makes the $0 cancellation filing deceptively important. Because Maryland never lets a dormant LLC lapse into a clean ended state on its own, the only way to stop the $300-per-year meter is to formally file the Articles of Cancellation yourself. An owner who assumes "I'll just stop using it" ends up with a forfeited entity that owes hundreds of dollars more every April, year after year, until they finally cancel, and the back balance has to be cleared to do so. This is the starkest version of the trap in can you just walk away from an LLC: in Maryland, walking away doesn't end the obligation, it compounds it. The good news is that ending it is free, so file the cancellation promptly.

Frequently asked questions

How much does it cost to dissolve a Maryland LLC?

The Articles of Cancellation are free for non-expedited processing ($0), or $50 if you want expedited handling. The cost that catches lapsed LLCs is the $300 annual report/personal property return: you must be current before SDAT will cancel, and because Maryland doesn't administratively dissolve neglected LLCs, those $300 charges keep accruing every year until you formally cancel.

Does Maryland administratively dissolve LLCs that stop filing?

No, and this is the crucial difference from most states. Rather than administratively dissolving a non-compliant LLC (which would stop new fees), Maryland puts it in "forfeiture status" and continues to accrue the $300 annual report fee plus penalties indefinitely. The only way to stop the charges is to formally file Articles of Cancellation. So letting a Maryland LLC sit is more costly than in nearly any other state.

How long does it take to dissolve a Maryland LLC?

Non-expedited Articles of Cancellation typically take several weeks (often around 4–8 weeks) to process by mail. Expedited processing (for a $50 fee) is much faster, around 7 business days. The longer part is usually getting compliant first: if you owe back annual reports or personal property returns, those must be filed and cleared before SDAT will accept the cancellation.

This page covers the Maryland specifics; for the general framework, see our complete guide to how to dissolve an LLC, and for nearby states, Virginia and Pennsylvania. Maryland's official filing is at Maryland SDAT, and taxes through the Comptroller of Maryland.