I. Obtaining an FEIN

The Federal Employer Identification Number (FEIN) is a unique nine-digit number used by the Internal Revenue Service (IRS) to identify any business operating in the United States. The IRS generally expects your business entity to be formed with the Maryland State Department of Assessments and Taxation (SDAT) before applying for a FEIN number. In other words, you will need to first register your business with SDAT as described in Step 1 and Step 2 of the Initial Registrations and Filings Phase in the Business Formation Workspace.

Note that your FEIN is different than the identification number assigned by SDAT after completing your registrations.

***Note that this requirement is the same as Step 3 in the Initial Registrations / Filings section***

II. Registering Tax Accounts 

After obtaining an FEIN, you will need to register your necessary tax accounts with the Comptroller of Maryland. We highly recommend registering through Maryland’s Business Express Website. In this portal, you can implement a Combined Registration Application, which registers your restaurant’s tax accounts for Sales and Use Tax, Employer Withholding Tax, Unemployment Insurance, Admissions and Amusement Tax, Tire Recycling Fee and Transient Vendor License.

For more information on how to do this, refer to the Registering Through the Maryland Business Express Website Guide.

You can also download the registration form here and fax or mail it to the below address. However, note that this registration form is far more difficult to navigate than doing it through Maryland’s Business Express Website.

    Central Registration
    Comptroller of Maryland Revenue Administration Center
    110 Carroll Street
    Annapolis, MD 21411-0001

For additional information, you can refer to each of the Comptroller’s taxpayer service offices. In all of their locations, you can obtain personal assistance for setting up tax accounts and asking questions regarding your business.

While you may need additional tax registrations depending on your business, this should cover the majority, if not all, the tax registrations initially required for your new restaurant. 

***Note that this requirement is the same as Step 4 in the Initial Registrations / Filings section***

III. Ongoing Tax Requirements

1. Annual Personal Property Return
Businesses in Maryland must pay an annual tax based on the value of their business personal property (e.g. furniture, fixtures, tools, machinery, equipment). SDAT conducts the valuation process while certain counties and towns in Maryland collect the tax based on your property’s location.

Note that while you can implement Annual Personal Property Returns online through Maryland’s Business Express, you have to submit a paper application when first starting a business.

2. Business Income Tax
Business Income Taxes are generally complicated and based on your specific business legal structure. For more information, see the Maryland’s Comptroller’s Office Website.

Unless you have significant experience in calculating such taxes, we highly recommend enlisting a professional or third party services / software.

3. Sales and Use Tax
As defined by the Maryland’s Comptroller’s Office:

“Businesses in Maryland are required to collect Maryland’s 6 percent sales and use tax and / or 9 percent alcoholic beverage taxes from you whenever you make a taxable purchase. The sale of tangible personal property is generally taxable except as otherwise provided by law; the sale of a service is generally not taxable except for certain taxable services provided by law.”

If you plan to enlist a professional or third party services / software for your business income tax, Sales and Use Tax will also be factored in.

4. Alcohol Tax
As defined by the Maryland’s Comptroller’s Office:

“Under the Maryland alcohol tax laws, the Revenue Administration Division is responsible for monitoring the manufacture, storage, transportation, sale and distribution of alcoholic beverages and tobacco in Maryland, while collecting nearly $310 million annually in state taxes on beer, wine and distilled spirits.”

If you plan to enlist a professional or third party services / software for your business income tax, Alcohol Tax will also be factored in.

5. Admissions and Amusement Tax
As defined by the Maryland’s Comptroller’s Office:

“A local tax collected by the Comptroller’s Office for Maryland’s counties and Baltimore City, incorporated cities and towns, and the Maryland Stadium Authority. The tax is imposed on the gross receipts from admissions, the use or rental of recreational or sports equipment and the sale of merchandise, refreshments or services at a nightclub or similar place where entertainment is provided. Admissions and amusement tax rates are set by local officials at rates varying from one-half of 1 percent to 10 percent of the admissions or amusement receipts. Rates vary by locality, and by activity with a few exceptions and special situations.”

If you plan to enlist a professional or third party services / software for your business income tax, Admissions and Amusement Tax will also be factored in.