Learn Everything You Need to Know to Form a Massachusetts LLC or a Corporation

Massachusetts Business Facts and Environment

MA Business Facts

Massachusetts small businesses employed 1.4 million people, or 46.8% of the private workforce, in 2014. Firms with fewer than 100 employees have the largest share of small business employment. During the year ending November 2016, private-sector employment increased 3.2%. This was above the previous year’s decrease of 0.1%.

Small businesses created 34,568 net jobs in 2014. Among the seven BDS size classes, firms employing 20 to 49 employees experienced the largest gains, adding 7,717 net jobs. The smallest gains were in firms employing 5 to 9 employees, which added 2,517 net jobs.

Major Companies in Massachusetts

Major Massachusetts companies include General Electric, TJX Companies, National Amusements, The Enterprise, Thermo Fisher Scientific, and Staples.

Massachusetts Startup Environment

While most entrepreneurs report that state regulations and taxes aren’t prohibitive or overwhelming, several small business owners said complying with regulations can be an unnecessary headache. Many have called for reform, but most added that the tax rates aren’t exorbitant, and the state and local governments are generally willing to work with entrepreneurs to help them navigate the legal framework.

Step 1: Decide on a Business Structure

There are 3 basic options: a DBA, a Corporation, or an LLC. Click here to learn more about business entities.

• A DBA or “Doing Business As” (also known as a “Fictitious Business Name” or FBN) is not really a separate structure, but just a different name that an individual or partners use as their business name.
• A Corporation is a separate entity (provides liability protection to the owners) that has a structure that includes shareholders, directors and officers. More complex than a DBA but the entity of choice for large companies and startups that intend to raise funding. Some professions are required to choose what is known as a “Professional Corporation” or PC (doctors, lawyers, architects, etc.).
• An LLC or “Limited Liability Company” is a newer type of business that is both a separate entity but provides very easy management (doesn’t require directors or officers) and taxation. Has largely replaced the DBA and Corporation in popularity recently as it provides liability protection but with much less complexity (and taxation) than a Corporation.

Step 2: Pick a Business Name

Choosing a business name is easier said than done – many legal and business problems can arise from picking the wrong name. Changing your business name is possible, but can be costly and take time. In Step 3 we’ll show you how to search for the name in Massachusetts, but we highly recommend you do the following before searching Massachusetts state databases:

• Make sure you’ve covered the basics: unique, easy to understand/pronounce (practice saying it out loud: “Thanks for calling XYZ”) and can survive over time (“DVD World” is not timely). Here are some of our tips on business identity including logo and trademarks.
• Search the web for your proposed name. Search Google, Bing and DuckDuckGo as a “first sweep” for any potential conflicts, especially in your state or local jurisdiction. NOTE: If you intend to operate nationally or even internationally it will be even more important that your name be unique. This should cover many cases where a company name is being used but not officially trademarked (see next tip).
• Do a trademark search with the US Patent and Trademark Office (USPTO). This will be a very good indicator if your name will have any conflicts. There’s an art to trademark searches (trademark specialists will charge you handsomely to do a thorough search) but in our experience if you can use Google at a fairly advanced level you can reasonably clear a name yourself.

Tip: search misspellings, plurals, variations of spelling, sound-alikes, and other versions of your chosen name to be sure it’s not already registered.

• Make sure your company name choice is available by searching the Massachusetts Business Entity Database. NOTE: Make sure to search variations of spelling, plurals and misspellings as the state may reject a name that is too similar (then you have to start all over again, wasting valuable time).

Restrictions on Massachusetts Business Name & Business Purpose

• Your Massachusetts LLC should contain the words ”limited liability company”, ”limited company”, or the abbreviation ”L.L.C.”, ”L.C.”, ”LLC” or ”LC”.
• A corporate name in Massachusetts must contain the word “corporation”, “incorporated”, “company” or “limited”, or the abbreviations “corp.”, “inc.” or “ltd.”.

Step 3: Register the Business

Each state has its own requirements for registering a business. Now that you’ve chosen a business structure and selected your business name, here are the requirements to register your business in Massachusetts.

How to form an LLC in Massachusetts

• File the “Certificate of Organization” with the Massachusetts Secretary of the Commonwealth.
• Once the certificate is filed and approved you will then need to properly organize your Massachusetts LLC (this also applies to “1-person LLC’s”) by holding an “Organizational Meeting” which takes contributions from the members, issues Member Certificates, adopts the company Operating Agreement and more.

How to Incorporate in Massachusetts

• File the “Articles of Organization” with the Massachusetts Secretary of the Commonwealth.
• Hold an “Organizational Meeting” to determine the percentage of ownership for each shareholder as well as resolve to do tasks like open a company bank account, pay back pre-incorporation expenses, elect S-Corporation status and more.
• Corporations can elect S-Corporation status with the IRS by filing IRS Form 2553. Click here to learn more about S-Corporations.

NOTE: When registering a new company the Secretary of the Commonwealth of Massachusetts can take several weeks to file the paperwork. You can expedite the process by hand delivering the documents directly to them or one of their field offices and paying an additional fee.

TIP: Check our order form to see how long Massachusetts is currently taking to process regular and expedited orders.

How to File a DBA in Massachusetts

A Massachusetts DBA is filed with your city clerk’s office. You’ll want to contact your local City Clerk to find out exactly what forms to submit and what their submission process is. You can find the local county recorder’s office by searching “YOURCITY city clerk”.

• Obtain and file the Business Certificate with your town or city to register your DBA. NOTE: Some cities will let you search the name and register online. Others require the form to be notarized.

Optional considerations when registering a Massachusetts business

Hire a professional Registered Agent. Many business owners list their home or business address on the Certificate or Articles of Organization. This can cause issues because it becomes public record (you’ll get lots of junk mail). A professional Registered Agent will provide their address and forward any important documents to you, this is also convenient if you have to move (you don’t have to file forms or pay fees, just update your address with your agent).

Ready to register a business in Massachusetts?

We specialize in registering businesses in Massachusetts.

Ready to Start Now? Let Us Do The Work

Sure, you could do all the steps above or you could spend 5-10 minutes on our order form and let us take care of it while you work on more important things.

• Learn more about how we can form your LLC or Corporation for you
• Read our verified reviews and 100% Satisfaction Guarantee
• Contact our friendly support team if you have any questions

Step 4: Obtain Your Federal Employer Identification Number

Your EIN is like your Social Security Number for your company. It’s required for Corporations and LLCs and optional for DBA’s (if you don’t have any employees, then it’s required). However, if you are a DBA and don’t obtain an EIN you will be forced to use your Social Security Number on many documents so it’s typically recommended you obtain the EIN to prevent identity theft.

To obtain an EIN you can apply online with the IRS or via IRS Form SS-4.

TIP: We will obtain your EIN for you if we form your company.

Step 5: Open Company Bank and Credit Accounts

To keep business and personal expenses separate, you should open a separate account for your business. In addition, getting business credit cards is how you begin to build a company credit profile (corporation or LLC required) and can later qualify for larger loans and lines of credit. To open the account simply call your chosen bank and ask for the steps to open a business bank account. Typically you’ll need a) your filed paperwork b) your EIN c) a company resolution authorizing your company to open the account (signed by the owners, members, officers or directors, etc.).

Click here to view a list of our recommended banks in our Vendor Network.

TIP: Our business formation service includes a free banking resolution for your use.

Step 6: Set-up An Accounting System

Setup your Accounting and Record-keeping system and learn about the taxes your new company is responsible for paying.

Company documents generally are required to be kept for 3 years, including a list of all owners and addresses, copies of all formation documents, financial statements, annual reports, amendments, or changes to the company. All Tax and Corporate Filings should be kept for at least 3 years. View our “Accounting & Financial Management” section for help with setting up an accounting system and purchasing accounting software.

Review our list of Accountants, Accounting Software, and Bookkeepers in our Vendor Network.

Step 7: Obtain Licenses and Permits

Now that you’ve registered your business name you may need to obtain a business license for your company – this authorizes your company to do business in your city or county depending on the type of service you offer. Typically this also involves registering for state taxes and permits (the city may require them as part of the business licensing process).

TIP: We can help you identify the necessary forms to obtain your business license.

Step 8: Hire Employees (if applicable)

If you intend to hire yourself or others as a full or part-time employee of your company, then you may have to register with the appropriate State Agencies or obtain Workers Compensation Insurance or Unemployment Insurance (or both). View our “Employees & Payroll” section for help with hiring employees and processing payroll.

Review our list of recommended Payroll Providers in our Vendor Network.

Step 9: Obtain Business Insurance

There are many types of insurance for businesses but they are usually packaged as “General Business Insurance” or a “Business Owner’s Policy”. This can cover everything from product liability to company vehicles. A decent policy can run as little as $300/year and offers a great extra level of protection.

Click here to view our list of insurance providers in our Vendor Network.

Step 10: Systemize and Organize

Prepare the business as if someone needed to take it over and run it for you. A system should be set up to process orders, pay bills, pay employees, pay taxes, maintain your permits, etc. Basically, try to make the operational aspect of the business as automated and efficient as possible so you can concentrate on growing your business. View our “Manage Your Company” section for help with systemizing and automating your business.

Step 11: Branding and Marketing

Now that you’ve set up the company for success, you need to get the word out. Create a marketing plan for your products and services that targets your ideal customer. View our “Marketing & Sales” section for help for more information.

Step 12: Annual and Ongoing Requirements

DBA: Your Business Certificate is valid for 4 years at which point you’ll need to renew it with your town or city clerk.

LLC: Massachusetts LLCs are required to file an annual report every year on or before the anniversary date of the filing of the original Certificate of Organization. The filing fee is $520.

Corporation: Corporations in Massachusetts must file an annual report each year within two and a half months of the close of the corporation’s fiscal year-end. The filing fee is $125 by mail and $100 for online filing.

Click here to view our MyCompanyWorks Premium™ service which can automate most of your ongoing compliance tasks.

Important Massachusetts Contacts

Massachusetts Secretary of the Commonwealth

Corporations Division (for Corporation and LLC filings)
McCormack Building
One Ashburton Place, 17th floor
Boston, MA 02108
Phone: 617-727-9640

Massachusetts Taxation Department

• Massachusetts Department of Revenue

Massachusetts Labor and Employment Department

• Executive Office of Labor and Workforce Development

Massachusetts Startup Resources

1. Small Business Administration (SBA)

• Boston District Office

2. SCORE Massachusetts

• The SCORE Northeast Massachusetts Chapter serves Essex, Northern Middlesex and parts of Northern Suffolk counties.
• The Western Massachusetts Chapter
• Southeast Massachusetts SCORE

3. Massachusetts Legal Statutes

• Massachusetts Business Corporation Act – applies to all Massachusetts business corporations.
• Massachusetts Limited Liability Company Act. – the specific act that applies to Massachusetts LLCs.
• Overview of Massachusetts Business Laws – an overview of Massachusetts business laws and regulations including taxes, new hire and wage regulations.

4. Massachusetts Chambers of Commerce

• Massachusetts Chamber of Commerce
• Cambridge Chamber of Commerce, MA
• Greater Boston Chamber of Commerce

5. MassEcon

• MassEcon champions Massachusetts as the best place to start, grow, or locate a business.  

6. Massachusetts Angel Investors

• List of Angel Investors in Massachusetts

7. Massachusetts Business News

• Boston Business Journal
• Business – The Boston Globe

8. Massachusetts Office of Business Development (MOBD)

9. Massachusetts Small Business Development Center (MSBDC)

10. Massachusetts Green Business

• The Sustainable Business Leader Program (SBLP)
• Green Startups