Ocean City and Worcester County Business License: Town License, Rental License and Seasonal Rules

If you plan to rent a condo, house, apartment or hotel room in Ocean City, or run a business in Worcester County, you will deal with at least three layers of licensing: the state, the county and the Town of Ocean City. Most first-time owners learn about the town layer after they have already listed a property. This guide puts the steps in the order you should take them, shows what each layer costs, and points out where people usually get stuck.

Disclaimer: This article is informational content, not legal or tax advice. Fees, ordinances and deadlines change. The Town of Ocean City, Worcester County and the Comptroller of Maryland are the final authorities on what you need. For complex situations, such as several properties, multiple owners or a mix of rental and retail activity, talk to a qualified attorney or CPA.

What you need before you start

• Your legal business name. If you use an LLC or corporation, have your SDAT charter information ready.
• A Maryland Business Express account at egov.maryland.gov/businessexpress for state filings.
• A federal EIN and a Maryland street address for your resident agent (no P.O. box). The agent must consent before you file.
• The exact property address, owner names and a count of sleeping rooms. The town fee depends on the property type and the number of rooms.
• Your deed or lease for the property. Confirm the full document list with the town before you apply.
• A payment method the town accepts. Ask the License Inspector before you assume a card, check or online option.

Step-by-step licensing in Ocean City and Worcester County

1. Classify the property first. The town fee follows the property type. A condo or single-family home pays $196 per year for the annual rental license and noise control permit. An apartment, hotel, motel or inn pays $196 plus $8 for each sleeping room. If you rent for stays of 30 consecutive days or fewer, you also pay a $50 surcharge for a short-term rental housing unit under Resolution 2025-01. Longer stays are treated differently, so confirm with the town how your lease terms will be classified before you set your rental rules.
2. Form your entity and register any trade name. If you do business under a name other than your own, file a Trade Name Registration with the State Department of Assessments and Taxation (SDAT). It is filed with SDAT, not the county, and costs $25 standard or $75 total with the $50 expedited fee. An LLC Articles of Organization costs $100 and a corporation Articles of Incorporation costs $120. Both carry a $300 annual report due April 15. If you need to hold a name while you prepare paperwork, a name reservation costs $25 and lasts 30 days.
3. Get a state sales and use tax number if it applies. The Sales and Use Tax License from the Comptroller of Maryland is free and is obtained through the Combined Registration Application at businessexpress.maryland.gov/start/taxes-and-insurance. Maryland's state sales tax rate is 6%. Whether your rental activity triggers this requirement is a question for the Comptroller or a tax advisor, so do not assume either answer.
4. Check whether you need a Worcester County trader's license. Trader's licenses are issued by the Clerk of the Circuit Court in your county. The license year runs May 1 through April 30. Growers and manufacturers are exempt. The Clerk cannot issue one if you owe personal property tax or have missing SDAT filings, so clear those first. Whether a lodging-only rental needs a trader's license is a question to put to the Clerk directly.
5. Apply for the Ocean City town business license. The town requires a business license from anyone providing a service within town limits, on top of the state and county licenses. The town fee for this license has not been verified for this guide. Ask the town License Inspector for the current amount and filing method before you send any money.
6. Apply for the rental license and noise control permit before you advertise. The annual rental license and noise control permit is $196 for a condo or single-family unit, or $196 plus $8 per sleeping room for apartments, hotels, motels and inns, plus the $50 short-term surcharge if it applies. Do not take bookings, post a listing or accept a deposit until the license is active.
7. Schedule your rental inspection within 30 days. New licenses must schedule a rental inspection within 30 days. The town also runs random inspections on a rotation from 2025 to 2029, so a unit that is compliant on paper can still be selected. Keep your room count, occupancy records and any required safety items organized, and confirm the inspection checklist with the town.
8. Set up the tax side before your first booking. Worcester County has a 5% hotel rental tax, based on Department of Legislative Services FY2026 figures. Confirm the current rate and collection method with the county. On the income side, Worcester County's 2.25% local income tax is the lowest local rate in Maryland for 2026. It applies in addition to the state rate of 2% to 6.5%. If your business is a pass-through entity such as an LLC, the income is reported on your personal Maryland return.
9. Calendar every renewal. Put the SDAT annual report and personal property return due April 15 on your calendar. Extension requests go to pprextensions.dat.maryland.gov. Add the town rental license renewal and the trader's license renewal, which is due by the end of the April 30 license year.

Ocean City fee summary

Item	Amount	Agency	Notes
LLC Articles of Organization	$100	SDAT	One-time filing
Corporation Articles of Incorporation	$120	SDAT	One-time filing
Annual report and personal property return	$300	SDAT	Due April 15 each year
Trade name registration	$25, or $75 with expedited fee	SDAT	Not filed with the county
Name reservation	$25	SDAT	Lasts 30 days
Sales and Use Tax License	Free	Comptroller of Maryland	Through the Combined Registration Application
Condo or single-family rental license and noise control permit	$196 per year	Town of Ocean City	Annual renewal
Apartment, hotel, motel or inn rental license	$196 plus $8 per sleeping room	Town of Ocean City	Annual renewal
Short-term rental housing unit surcharge	$50	Town of Ocean City	Stays of 30 consecutive days or fewer, per Resolution 2025-01
Town business license	Not verified	Town License Inspector	Confirm the current fee before paying
Trader's license	Not verified	Clerk of the Circuit Court	May 1 to April 30 license year

Some sample totals for the town layer alone: a single-family unit used for short-term stays costs $246 per year ($196 plus $50). A four-room inn used for short-term stays costs $278 per year ($196, plus $32 for four rooms, plus $50). Add the business license fee once the town confirms it.

Seasonal rules and deadlines

This guide does not list any verified summer or off-season restrictions, so please do not treat the seasonal calendar as a list of rental rules. What is verified is the timing you have to plan around. The SDAT annual report and personal property return are due April 15. The trader's license year runs May 1 through April 30. The town rental license is an annual license, and new licenses must schedule an inspection within 30 days. Ask the town License Inspector whether any occupancy or season-specific conditions apply to your property before your peak booking window opens.

Berlin short-term rentals

Berlin is a separate municipality in Worcester County, so an Ocean City license does not cover a property in Berlin. Berlin adopted its own short-term rental ordinance in 2022. At that time, reported figures were a $350 application fee and a $125 renewal fee. Current Berlin terms have not been verified for this guide, so confirm the current application fee, renewal fee and inspection requirements with the Town of Berlin before you list a property there.

Common mistakes to avoid

• Using old fee figures. Platform fee estimates and the old ordinance amount of $116 are outdated. Check the current town schedule before you budget.
• Renting before the license is active. Renting without an active license is a municipal infraction. Fines can reach $5,000, and each day can be charged as a separate offense.
• Miscounting sleeping rooms. For apartments, hotels, motels and inns, the per-room fee depends on the count, so an undercount can produce an underpayment.
• Assuming a state LLC covers local licenses. The SDAT filing is a state step. The town, the county and the Clerk each have their own requirements.
• Missing the 30-day inspection window. New licenses must schedule the rental inspection within 30 days.
• Letting SDAT filings lapse. The Clerk cannot issue a trader's license if you have missing SDAT filings or unpaid personal property tax.
• Forgetting the county hotel rental tax. Confirm the 5% Worcester County rate before your first booking, not after your first audit.

Tips from the process

• Get every fee and document list in writing from the town, then keep a dated copy in your records.
• Use one calendar for April 15, April 30 and your town renewal date. Missed dates are the most common cause of avoidable penalties.
• If you are unsure how your property is classified, ask the town for a written determination before you apply.
• The Maryland Small Business Development Center Network offers free advising at marylandsbdc.org. It can help you sort out the state steps before you start the local ones.

Expected results

If you complete the steps in order, you may find that the process takes several weeks, depending on how quickly the state, county and town respond. Once your rental license is active and your inspection is scheduled or complete, you should be in a position to take bookings legally. Results can vary with your property type, your room count and the timing of your filings, so plan extra time before your peak season. Confirm every fee, deadline and inspection requirement with the agency named in this guide, and talk to a qualified attorney or CPA if your situation is complex.