My business is forfeited - now what? 

A surprising number of small businesses in Maryland may not realize that they must file annual personal property returns.  Maybe they overlook the mailing from the State or think it is redundant so long as they get their income taxes in.  Whatever the reason, filings are overlooked, with serious consequences.  If a business neglects its personal property returns for a long enough time it will eventually find that its charter -- or legal right to do business - is forfeited. 

When the returns are overdue, the State will switch your business status to "not in good standing."  If your business is not in good standing, you can remedy the problem without too much hassle by filing for any past / overdue returns before the charter is forfeited.   

After some point in time, the State Department of Assessments and Taxation will actually forfeit or yank the charter of a business not in good standing.   That is not a good thing as the business no longer has a legal right to do business.  The individuals running the show risk increased liability exposure.  Moreover, it may be criminal to continue to use the forfeited business name.   To get things back up in good standing, one must "revive" or re-instate the entity.  This means filing any overdue returns, paying any tax, getting clearance from a government office and  once that is accomplished, filing Articles of Revival (with associated filing fee).   If a business has waited several years, it may find this process expensive.

Bottom line?  If you haven't filed your personal property return, do so!  If you see your charter is not in good standing, fix this right away before the legal existence of the entity is terminated.    

© ArdenLawFirm 2014-2018  Managing Attorney Cedulie Laumann, Esq.