Our company is not in good standing, how exactly do we remedy this?

[Pastameister]

Our company is an LLC based in Maryland and just formed this December. We have no inventory, revenue, debts, or liabilities aside from the liabilities we owe to the IRS.

I recently checked the status of our LLC and I found out that our company is not in good standing and thus I understand we need to fill out a Annual Report and Personal Property Return, but I am not sure how the late fees will work or how to fill out some of the options such as Manufacturing/Research and Development (R&D) Inventory when we do not have anything.
These last few months we have only done research and designing which did not cost our business any money . We have not spent any money other than filing IRS forms with technically personal money.

We would also like to know how urgent is getting this form filled out, and when will our company become forfeited.

Thanks

[Evan]

If there are TWO important dates to not forget -- it's when your annual report is due to the Secretary of State (to prevent your entity from being administratively dissolved) AND when your tax return is to be filed.

You can usually file both late though you may incur significant penalties for doing so. Get into compliance by filing both now.

[Pastameister]

Ok, we will, but I would still like to know when our business would go from not in good standing to forfiet if we do not file now (hypothetical)

[Harold Mansfield]

Ok, we will, but I would still like to know when our business would go from not in good standing to forfiet if we do not file now (hypothetical)
Why haven't you simply just asked the IRS this? They have phone numbers, and agents that are perfectly willing to answer questions and work with you. No matter what we say here, you won't get a better answer or even leeway, than calling them directly.

Also this...


These last few months we have only done research and designing which did not cost our business any money . We have not spent any money other than filing IRS forms with technically personal money.


Research and designing cost money. Obviously it was significant enough to mention, so it should be treated like someone actually did the work or put in the time. Time is worth money. Was it done by robots? How much did the robots cost?
If you don't start treating this like an expense you're going to leave a gaping hole in your accounting of lost money.

Also don't mix personal money with business money. If you need to loan the business money, then do that. On paper.

[Evan]

It varies, but the state would generally notify you for not filing after about three years that they've dissolved your LLC. Now you have no legal liability protection. For the IRS, they can't "dissolve" you but they can charge you significant penalties and interest.

[Business Attorney]

You should get the LLC back in good standing as soon as possible. In Illinois, the secretary of state dissolves the LLC 6 months after the annual report is due. I could not see anything on the Maryland.gov website that says how soon your LLC is "forfeited" (the term used in Maryland).

Once it is forfeited, the legal existence of your LLC ceases and you have no limited liability protection, as Evan pointed out.