How to Start an LLC in Massachusetts: If you’re looking to start a Massachusetts LLC for $0, you’ve come to the right page. Setting up an LLC is easy and cost-effective. To form an LLC, you must follow a few steps that include naming your LLC, hiring a registered agent, filing your formation documents, doing the operating agreement, and finally obtaining the EIN. You can easily set up your LLC for free in Massachusetts. However, you must pay the mandatory state filing fee. These fees and charges can be tax deductible, making the LLC formation cost $0.
On this page, You’ll find all the steps that must be taken to ensure that your Massachusetts LLC has been correctly formed. We recommend you read the whole article very carefully, word by word, don’t miss anything 🙂
On this page, you’ll learn about the following:
- How to Start an LLC in Massachusetts
- After Starting Your Massachusetts LLC
- Massachusetts Foreign LLC
- Massachusetts LLC Formation Review
How to Start an LLC in Massachusetts
An LLC (aka Limited Liability Company) is a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. It separates your personal assets from your business assets, thus giving you personal asset protection. For an LLC, members’ personal assets are not affected by business debts. However, in some cases, if the LLC is sued for business debts, courts might pierce the corporate veil and use the owner’s personal assets to meet their corporate liabilities.
If you wish to start an LLC in Massachusetts, you must file your Certificate of Organization with the State and pay a filing fee of $500. While it’s the most important step, it’s not the only one. There are 4 other crucial steps to follow to get your LLC formed in Massachusetts. Below mentioned all 5 steps that explain everything you need to do to start a Massachusetts LLC in 2023. Let’s get started! You can always hire a professional LLC formation service in Massachusetts to set up your LLC instead of doing it alone; a Pro service will ensure everything is done properly.
Step 1: Decide a Name for Your Massachusetts LLC
The first step while forming a limited liability company in Massachusetts is to give a proper name to your LLC. Before you name your business, you must know that the name should be easy to remember, available in the state, and follows all the LLC naming guidelines.
Massachusetts LLC Naming Guidelines
There are a few specific requirements all the LLCs in Massachusetts have to follow while naming their Company. Some of the most important requirements are as follows:
- Your business name should be available and no other existing business in Massachusetts can have the same name. ZenBusiness offers unlimited business name searches at $0.
- “Limited Liability Company”, “Limited Company”, “LC”, “L.C.”, “LLC”, and “L.L.C.” – any one of these has to be used as a suffix in your business name.
- You cannot use any name for your business that is confusing or misleading. Terms such as “Treasury”, “State Department”, “FBI”, “CIA”, etc. shouldn’t be included.
- Terms like “Bank“, “University“, “Attorney“, “Doctor“, etc can be added only after the additional requirements by Massachusetts State Government are fulfilled.
- (Optional) It’s better to name your business something for which your desired domain is available.
|Important Links –||Submit Offline Form to –|
|Massachusetts Business Entity Search – Online Search |
Name Reservation Form – PDF
Name Availability Standards – Guidelines
Massachusetts LLC Name Search – Instructions
|Secretary of the Commonwealth|
One Ashburton Place, Room 1717
Boston, Massachusetts 02108
Reserve Business Name for Future
If you do not wish to file your LLC right now but want to hold the name you have decided on, then you can reserve your LLC name for 60 days. To keep the name, you must file a name reservation application and pay $30 to reserve your name with the Massachusetts Secretary of State.
Doing Business As (DBA) or Trade Name
Once you have a legal name for your LLC, you can register it. However, it is not mandatory. You can, instead, use DBA, Fictitious Name, or Trade Name. In that case, you must register your name with the Massachusetts Secretary of State by submitting an Application to File Trade Name in Massachusetts along with the filing fee of $65 (An additional fee of $35 for non-Massachusetts residents).
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ZenBusiness – ($0 for LLC Formation)
Apart from LLC formation, ZenBusiness offers customized website templates and business emails at a very reasonable price. If you plan to get a website, then it is wise to have a “.com” domain for your business, but these days you can also use other TLDs like “.io”, “.company”, “.xyz,” etc. Here you can get everything you need for your business in one dashboard.
It is not legally mandatory to use the word LLC in your domain name or email. If you want, you can use it. However, it is recommended not to use LLC in the domain name. A domain name should be short and easy to remember.
Step 2: Assign a Resident Agent in Massachusetts
The second step to forming an LLC in Massachusetts is to appoint a Resident Agent (also known as a registered agent in most states). A Resident Agent is a person or business entity working on your LLC’s behalf. This person or business will receive important tax forms, legal documents, all notices of lawsuits, and other official government correspondence in Massachusetts. Hence, hiring a competent Massachusetts Resident Agent for your LLC is necessary.
Make sure your registered agent is a resident of Massachusetts or has a physical street address. This address will be used as the principal address of your LLC to receive any legal documents. Most LLC formation companies also provide registered agent services. Below are two great LLC formation services; even if you buy their cheapest plan (normally $0/year), you also get registered agent service and other services at a very reasonable price.
These two are our top recommendations for registered agent service, as they are competent and authorized to conduct business in Massachusetts. Some LLC formation services also offer standalone Massachusetts registered agent services. You can purchase only Registered Agent services without purchasing any other LLC formation services. This standalone service might become handy if you are doing it yourself and don’t want to disclose your home address or you don’t want to pierce the corporate veil.
A person above 18 years of age and has a physical address in the state of Massachusetts can be a Registered Agent. A Registered Agent can be an independent person or can be a business entity. One is responsible for handling all the legal documents on the LLCs behalf.
Yes, you can be your own registered agent if you are a resident of the state of Massachusetts and you are above 18 years of age. To become a registered agent, you must have the authority to conduct any type of business in Massachusetts.
There are a few reasons why you shouldn’t be your own registered agent. The address of the registered agent is used to communicate with the SOS or for any legal activities. If you are your own registered agent, you might have to upload your personal address to the public forum. Besides, the registered agent must be at the address during business hours. It won’t be easy for you as you also have to take care of other things in your LLC. Hence, it is wiser to appoint a separate entity as your registered agent.
If an LLC is sued in Massachusetts, in some cases, courts might decide to lift the corporate veil, which means the owners of the LLC will be personally liable for their business debts. They might have to forgo their personal assets to repay their business debts. This is called piercing the corporate veil, where personal and business assets are not separated anymore. Your personal assets can be protected if you have enough capital and all your LLC documents are properly filed.
Registered Agent Consent Application
In Massa, there is no separate Consent Letter to be produced to the Secretary of State. At the time of change of Registered Agent (or the name or address), the new Registered Agent has to sign the consent letter. It comes with the Application form to Change the Registered Agent. The filing fee of $25 should be paid for it. For more information on the same, read our guide on Massachusetts Registered Agent.
Step 3: File Certificate of Organization in Massachusetts
The third and most important step in forming a Massachusetts LLC is to file the Certificate of Organization. This Massachusetts Certificate of Organization is a legal document that is required to register your business with the Massachusetts Secretary of State. It costs $500 to file your formation certificate in Massachusetts.
The Certificate of Organization includes details like the name of the LLC, the registered agent’s name, address, employees’ details, and the company’s structure (member-managed or manager-managed). Before hiring employees in Massachusetts LLC, one should know about the rules and regulations thoroughly. Also, if you are expanding your existing business (an LLC) in other states to Massachusetts, you must register as a Massachusetts Foreign LLC.
How to File Online
Go to the Secretary of State Online Service. You will get the online service page. If you are already a subscriber, then click on the “log in to Subscribe Account” option and log in with your credentials. If you’re not subscribed, then you can directly start filing your LLC by clicking on the “Online Filing” button below. Read more about the Massachusetts Certificate of Organization for online registration.
How to File by Mail
If you prefer filing real-life forms for your Massachusetts LLC registration, then you can download Domestic LLC Formation Form. Read the form thoroughly, fill it out, and mail it to the following address,
William Francis Galvin
Secretary of the Commonwealth
One Ashburton Place, Room 1717
Boston, MA 02108
Fax To: (617) 624-3891
Processing Time: Normally, it takes around 5 business days (approx) to get your LLC formed in Massachusetts. The processing time for online filing might be a little faster than offline filing. With an additional cost, you can get expedited filing as well. However, the document processing time can be changed due to various factors.
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Every LLC owner has to pay the filing fees to register their business in Massachusetts. This fee is mandatory but also tax deductible. If you’re doing it yourself (filing on your own), it will not cost you any additional service fee. However, it is not feasible to do that as the DIY process might be delayed, complicated, and messy, especially if you’re a novice entrepreneur. Hence, it is recommended to get professional guidance to get your LLC formed in Massachusetts.
Step 4: Create Your Massachusetts LLC Operating Agreement
Moving on to the fourth step, filing your operating agreement. An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC. This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
When it comes to filing a Massachusetts LLC Operating Agreement, the state does not require you to have a comprehensive operating agreement, but it is ideal to have one that contains all the details of your business operation that helps in taking future business decisions, especially if you decide to dissolve Massachusetts LLC later. Hence, having an operating agreement may not be necessary, but it is surely ideal.
Recommended: You can get a professionally made operating agreement for very less cost with ZenBusiness. You don’t need to worry about drafting it as they will take care of it on your behalf. We recommend using –
ZenBusiness – ($0 + State Fees) Online LLC Setup
The operating agreement draft can be created for free if you don’t hire a professional. However, there is an advantage to appointing a proficient person/service. You will get a businesslike quality operating agreement at a very cheap fee, which will help you in the future. Hiring a professional service means you can sleep well at night 🙂
Step 5: Filing a Massachusetts LLC EIN
The Employer Identification Number (aka EIN) is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify the type of business for tax purposes and taxes in general. The EIN is necessary for any active business or any form of business.
EIN is needed when the LLC hires employees. Hiring employees in Massachusetts LLC requires following specific rules and regulations. On the other side, EIN for Massachusetts foreign LLC should be obtained if your LLC is based in other states.
To obtain EIN (aka FEIN), one must fill up a form (Online or by mail) and submit it to the IRS. Enter details of your LLC, and finally, complete the form and send it to the address given. You can also get an EIN Assistant to help you with the process.
Mail to: Internal Revenue Service, Attn: EIN Operation, Cincinnati, OH 45999
Fax: (855) 641-6935 | Fee: Free
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ZenBusiness – ($0 + State Fees) Online LLC Setup
Note: You don’t need a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
Congratulation, you are now done with all the necessary steps to form your Limited Liability Company in Massachusetts. If you do it yourself, it should take you a long time to understand and do all the steps properly.
However, if you use ZenBusiness, it should be way faster. You will always have a live chat option and phone support with experts for any help you need. Their worry-free service will make things easier for you.
After Starting Your Massachusetts LLC
After forming your LLC, there are still some things that you will need. The most important thing is to separate your business and personal assets. LLCs have limited liability protection that protects your personal assets from business liability. This is called a corporate veil. However, the corporate veil can be lifted or pierced by the court if the LLC is sued. In that case, the owners of the LLC become personally liable for their corporate debts. A few things like appointing a legit registered agent, having enough capital, and filing all the major documents with the state can save the LLCs from being pierced into the corporate veil.
Apart from that, there are a few things you need to take note of,
- Get a company business bank account
- File Massachusetts business permits & licenses
- Get general liability insurance and professional liability insurance with coverage for employees.
- File a Massachusetts LLC annual report or biennial report
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.
Cost of Massachusetts LLC
LLCs can be formed for $0. Apart from the mandatory state filing fees, you don’t have to bear additional service charges if you do it yourself. Following are the fees and taxes LLCs in Massachusetts must pay to register and run a business in the state. Forming an LLC is no doubt cost-effective compared to other business structures. However, the fees and charges (tax-deductible) that you must pay to the state, such as name reservation fee, name filing fee, LLC filing fee, and Franchise Tax & Sales Tax (If applicable). Here are the main fees and taxes you must pay while forming your limited liability company in Massachusetts,
|Fees/Tax||Amount to be Paid|
|Name Reservation Fee||$30|
|Certificate of Organization Fee||$500|
|LLC Annual Fee||$500|
In Massachusetts, an LLC name reservation is not mandatory. You can register your LLC name at the time of registering your LLC. If you wish to hold the name for some time without registering your LLC, then you can do that online. Your LLC name will be reserved for 30 days without registering your LLC. It can be renewed once for another 60 days by paying $30.
In Massachusetts, an Annual Report has to be produced every year. It costs $500. Also, the state of Massachusetts has to pay a Sales Tax of 6.25%. Read our guide on LLC costs in Massachusetts for more information.
Massachusetts Foreign LLC
If you are interested in forming a Foreign LLC in Massachusetts, then you need to file the Certificate of Foreign LLC to the Massachusetts Secretary of State. Foreign LLCs allow you to operate your business in more than one state. Along with the Certificate of Foreign LLC, you need to submit some more documents like the Certificate of Good Standing, etc. to the Massachusetts SOS to form your foreign LLC in Massachusetts. To know more in detail, check out our guide on Massachusetts Foreign LLC.
Reasons to Start an LLC in Massachusetts
Below discussed are some of the long-lasting benefits of the Massachusetts LLC. For an LLC, especially start-ups, Massachusetts have diverse business funding options. Depending on the type of business, for example, a woman-owned business, get loan facilities. Some of the benefits that a new LLC business will enjoy in the state are discussed. It will help a person take a step towards the formation of an LLC and start their business. LLCs have the opportunity to earn extra profit as it costs lesser than other types of business structures.
Succession of shares
While setting up a Massachusetts LLC, entrepreneurs will enjoy the benefit of a succession of shares to their heirs. In other states, this facility is not available. Generally, after the death of a member, the shares of that particular person get distributed to other members. On the other hand, in MA, the shares will be passed on to their family/heirs. If any misfortunate incident happens with any of the members while serving in LLC, his/her family can continue as a member/partner.
Discounted prices of taxes for LLCs
The tax one has to pay while setting up an LLC in Massachusetts is discounted for many businesses. Around 25% to 40% discounts are given to the LLCs on paying state and federal taxes. Read more on Massachusetts’ classification of LLC tax.
Moreover, there is a discount for the members on the health insurance as well. It helps in an overall saving in the monthly costs of the member, and one can use it to bear some of the company’s costs.
Economic development incentive program credit
The government of Massachusetts State starts the IPC program to ensure some savings on taxes. It will help LLCs to create jobs and develop the state’s economic status. Additionally, the government can provide a credit of up to $5000 for every job created by the LLC. But for getting this benefit, one needs to qualify their business under the state’s laws.
Great point of attraction for investors
If someone looks forward to starting a Massachusetts LLC, they benefit from attracting an investor and raising funds. The state let the LLC issue their stocks in the early stages to onboard the investors with the help of stocks and explore their USPs in a much better way.
Brownfield Tax Credit
The BTC is again an incentive for LLCs in Massachusetts in which the members are allowed to lease their contaminated land, which will help them get over their financial burdens and keep the LLC in a running state.
Best Businesses in Massachusetts
Several businesses are established in Massachusetts state that you should know before you form an LLC in Massachusetts. That is why here is a list of top businesses operating for a longer period of time.
If you look at Massachusetts’ geography, then it has around 1500 miles of Atlantic ocean borderline. This has enabled the traders to easily trade through the marine ways, which has become a major part of the state’s domestic economy with time. This growing industry has contributed around $2.40 billion to the state GDP. Through the sea links, goods can be transported easily and at lower prices.
Another benefit of such a huge sea coast is the seafood and its product. A whale can be easily found in the Atlantic sea, and they have been hunted for its precious oil and food. Other valuable sea fishes are haddock, Atlantic cod, Black Sea Bass, etc.
According to recently generated reports, the northeastern state of Massachusetts is home to 1700 IT companies. The reason behind such a massive number of IT companies is the easy availability of highly qualified staff in the state. They are established in the state, offering plenty of IT and technology-related services to businesses and organizations to help them grow. The IT sector’s contribution to the GDP of Massachusetts is around $35.18 billion, which is expected to double in less than a decade.
Finance and Real Estate
The contribution of the financial and real estate businesses to the state GDP is around $110 billion. More than dozen of fortune 500 companies are formed and located in the state that is helping people. Many personal and corporate financing houses are available in the state that handles all your business-related finances and issues.
Some small business ideas of Massachusetts state are:-
- Customized tour and travel services
- Berry farming and export
- Life coaching
Massachusetts LLC Formation Review
Time needed: 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Massachusetts. Click on the steps in this list to read the full detail.
- Name your Massachusetts LLC
The first thing you must do is to choose a company name, which should be unique, easy to find, and available in the state.
- Choose a Registered Agent
In Massachusetts, it is mandatory to select a registered agent for your LLC. Get a professional Registered Agent from LLC formation services to get things done hassle-free.
- File a Formation Certificate
Filing a formation certificate is necessary when forming an LLC in Massachusetts. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Create an Operating Agreement
An operating agreement is not a strict requirement in Massachusetts but something encouraged when you start an LLC to avoid future conflicts.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number but for a company.
How Fast Can I Form an LLC in Massachusetts
Online filings for Massachusetts LLC may be processed within 4 hours of payment. If filing via mail, it may take up to 4-5 business days. By paying additional fees to the state, the process can be expedited.
Forming an LLC in Massachusetts can be a relatively quick process, depending on a few factors. While the entire process can be completed in a matter of days, the amount of time it will take can vary depending on whether you are forming the LLC yourself or using a service or attorney.
If you choose to form an LLC in Massachusetts without the help of a service or attorney, there is a specific process you must follow in order to be successful. The first step is to choose a unique business name that is not already in use. Once you’ve settled on a name, you must file the Articles of Organization with the Massachusetts Secretary of State. This document will serve as the official record of your business’s formation and must include basic information about the LLC, such as the names and addresses of the owners, the business’s purpose, and the address of its principal office.
Once you have filed the Articles of Organization, your LLC is officially formed. However, there are still a few additional steps to take in order to ensure your LLC is compliant with Massachusetts law. These steps include obtaining an Employer Identification Number (EIN) from the IRS, registering with the state as an employer, and filing any necessary paperwork with your city or town.
The entire process can be completed in as little as a few days, depending on how quickly you are able to gather the necessary paperwork and submit it to the necessary offices. However, if you are pressed for time, it is possible to speed up the process by using a service or attorney. These services can help you quickly file the Articles of Organization, register with the state, and obtain the necessary permits and licenses required to operate your business in Massachusetts.
Using a service or attorney to form an LLC in Massachusetts can be a great way to save time, but it is important to note that there may be additional costs associated with these services. Additionally, it is important to make sure you are working with a reputable service or attorney in order to ensure that your LLC is properly formed and compliant with all applicable laws.
In conclusion, forming an LLC in Massachusetts can be a relatively quick process, depending on how you choose to proceed. If you are comfortable completing the process yourself, you can form your LLC in a matter of days. However, if you are pressed for time, you can use a service or attorney to speed up the process, though there may be additional costs associated with these services. No matter how you choose to form your LLC, it is important to ensure that you have all the necessary paperwork and that it is properly submitted to the necessary offices.
If you are a resident of Massachusetts, then you can file your LLC by yourself. However, it is always worth having a professional than doing it yourself to handle legal complexities, paperwork, and other documentation.
Apart from the formation fee of $500 (domestic LLC) and $500 (foreign LLC), LLC costs in Massachusetts include $500 for Annual Reports every year. LLCs are liable to pay sales tax of 6.25% every year.
It takes 4 hours to get a Massachusetts LLC if you file it online. For the mail filing, it takes 4 to 5 business days to get an LLC. If you hire a professional LLC service, then it might take less than that. We recommend ZenBusiness which has impeccable turnaround time.
Every year all the LLCs have to submit an Annual Report and pay $500 to the Massachusetts Secretary of State and renew the LLC. It is mandatory to renew your LLC every year.
Generally, for the LLCs, it is a default tax structure. Once you will obtain the EIN, you will get the various tax structure options to select. Sometimes LLCs choose S Corp to reduce federal tax burdens. Read more on the Massachusetts Classification of LLC Tax.
Having an LLC is easier than other forms of business. LLCs have a ‘pass-through taxation’ advantage LLCs are easier to establish than other business structures. Small businesses, especially start-ups can easily start an LLC in Massachusetts at a bare minimum cost. LLCs have a ‘pass-through taxation’ advantage for which they are excluded from certain taxes. The formation of limited liability companies requires much lesser documents and legal processes. Share your queries with us, and leave a comment below.