Maryland LLC vs Delaware LLC (2026)
Compare Maryland LLC vs Delaware LLC — filing fees, taxes, privacy laws, and annual costs. Find out which state is actually better for your business.
| Factor | Maryland | Delaware |
|---|---|---|
| Filing Fee | $100 | $90 |
| Processing Time | 7 day(s) | 7 day(s) |
| Annual Report Fee | $300 | $300 |
| Annual Report Due | April 15 | June 1 |
| State Income Tax | Yes | No |
| Anonymous LLC | No | Yes |
| Publication Requirement | No | No |
| Foreign LLC Cost (if forming out-of-state) | N/A — you're in your home state | ~$225 + registered agent ~$150/yr |
Verdict: Maryland wins for most businesses
For most Maryland-based small businesses, forming locally is the better choice due to lower total costs and simpler compliance. Delaware only makes sense if you need anonymous ownership, have sophisticated investors, or plan to operate in multiple states.
Filing Fees & Formation Costs
Delaware has a slightly lower filing fee at $90 versus Maryland's $100. However, if you form in Delaware while operating in Maryland, you'll need to register as a foreign LLC in Maryland for approximately $225, plus hire a Delaware registered agent for around $150 annually. This makes the true first-year cost of Delaware formation over $465 compared to just $100 for Maryland. The $10 savings on the filing fee gets quickly erased by the additional compliance requirements.
Taxes: Maryland vs Delaware
Maryland imposes a state income tax on LLC profits, which pass through to members' personal returns. Delaware has no state income tax, but charges an annual franchise tax of $300 (same as Maryland's annual report fee). However, if you form in Delaware but operate in Maryland, you'll still owe Maryland state taxes on income earned there. This means Delaware formation doesn't actually save you any tax burden if your business activities occur in Maryland.
Privacy & Asset Protection
Delaware offers superior privacy protection, allowing anonymous LLC formation where beneficial owners' names don't appear in public records. Maryland requires disclosure of member information in its filings, making ownership details publicly accessible. Both states offer strong charging order protection, limiting creditors' ability to seize LLC assets to satisfy personal debts of members. Delaware's privacy advantage is its main competitive edge over Maryland formation.
Annual Maintenance Costs
Both states charge identical $300 annual report fees, with Maryland's due April 15 and Delaware's due June 1. However, Delaware formation requires maintaining a registered agent in Delaware (typically $150-$200 annually) even if you operate elsewhere. Maryland-based businesses forming locally only need to maintain compliance in one state. Over five years, Delaware formation costs approximately $750-$1,000 more than Maryland due to the registered agent requirement.
When Delaware Actually Makes Sense
Delaware formation is beneficial for businesses seeking maximum privacy protection, as member names remain confidential in public records. Venture capital and private equity investors sometimes prefer Delaware entities due to well-established corporate law precedents. Multi-state businesses may find Delaware's consistent legal framework advantageous for complex operations. However, for typical Maryland small businesses with local operations and standard privacy needs, these benefits rarely justify the additional costs and complexity.