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Business Personal Property

TRADER'S LICENSE REQUIREMENTS
A GUIDE FOR BUSINESSES
 
Prepared By The License Bureau of The Comptroller's Office
and The State Department of Assessments & Taxation

 Generally, a business which sells goods or merchandise within Maryland must obtain a trader's license from the Clerk of the Court by May 1 of each year. The fee for the license is based on the value of the inventory of the business which is certified by the State Department of Assessments and Taxation (SDAT) based on information listed in the annual personal property return

 Sometimes businesses requiring a trader's license experience problems in obtaining one. Most of these problems are the result of one or more of the following six situations:  

1) Failure to file a personal property return (previous year).
2) Failure to report commercial inventory on the personal property return (previous year).
3) Unpaid personal property taxes (previous year).
4) Unpaid late filing penalty owed to SDAT.
5) Failure to register with SDAT.
6) Forfeited status with SDAT.

1) Failure to file a personal property return. Most businesses in Maryland must file a personal property return with the State Department of Assessments & Taxation by April 15 of each year. This return must be filed and assessed before a trader's license can be obtained by the business for the following year. To check on the status of a return, call 410-767-1170 for a corporation, limited liability company (LLC), limited partnership (LP), or limited liability partnership (LLP). For sole proprietors and general partnerships, call 410-767-4991.
 

2) Failure to report commercial inventory. A business that requires a trader's license must report commercial inventory (merchandise held for sale or resale) on its personal property return. If commercial inventory was not reported, an amended return must be filed with the State Department of Assessments and Taxation reporting the average inventory held by the business during the preceding calendar year. If the business does not possess or own commercial inventory, then it does not need a trader's license.
 

3) Unpaid personal property taxes. All businesses which own taxable personal property are required to pay taxes on this property based on the return mentioned above. These taxes are billed by the County and Town Treasurer/Finance Offices and must be paid before a trader's license can be obtained by the business.
 

4) Unpaid late filing penalty. When the personal property return mentioned above is filed late, a penalty is assessed as required by law. This penalty must be paid to the Personal Property Division of SDAT before the trader's license can be issued to the business. To determine whether a penalty is due, call 410-767-1170 for all entities other than proprietors and general partner- ships. For these entities, call 410-767-4991.
 

5) Business failed to register with SDAT. Before a trader's license can be issued, a business must have a Department identification number. This is given at the time of incorporation, qualification, registration, or formation and functions as the audit control number on future trader's license applications. For inquiries concerning forming a corporation, LLC, LLP, or LP call 410-767-1340. Sole proprietors and general partnerships should call 410-767-4991 to apply for a Department identification number.
 

6) Forfeited status. This category includes domestic and foreign corporations, LLCs, LLPs, or LPs whose legal right to conduct business as that entity has been revoked. Forfeiture occurs when a business fails to:

-file an annual personal property return.  
-pay a late filing penalty.  
-pay State income or some other tax collectible by the Comptroller of the Treasury.  
-pay unemployment insurance taxes due to the Department of Labor, Licensing &Regulation.  

If forfeited, a trader's license applicant should call 410-767-1340 for information and instructions.

 
A new business applying for a first time license:
1) must be registered with SDAT as mentioned above, and  
2) present the SDAT Department identification number to the Clerk of the Court in the county where the business will be located.


Following are the phone numbers for the Clerks of the Circuit Court in each county:

Allegany  301-777-5922
Anne Arundel   410-222-1434
Baltimore City 410-333-3790
Baltimore County 410-887-2607
Calvert 410-535-1660
Caroline 410-479-1811
Carroll 410-857-2023
Cecil 410-996-5380
Charles 301-932-3240
Dorchester 410-228-0480
Frederick  301-600-1976
Garrett  301-334-1937
Harford 410-638-3248
Howard 410-313-2111
Kent  410-778-7460
Montgomery  240-777-9460
Prince George's 301-952-3330
Queen Anne's 410-758-1773
St. Mary's 301-475-4563
Somerset  410-845-4840
Talbot  410-822-2611
Washington  301-733-8660
Wicomico 410-543-1427
Worcester  410-632-5500
 

If you have questions concerning the need for a trader's license, please call the
License Bureau of the Comptroller's Office
at
410-260-6240 or toll free 1-866-239-9359.


Revised: October 2007