How to Start an LLC in Massachusetts (Step-by-Step Guide)

If you’re considering forming a Massachusetts LLC, you’re making a smart choice for protecting your assets while enjoying flexibility in business operations.

To establish your LLC successfully, you must choose a unique business name, designate a registered agent, and create an LLC operating agreement.

But there’s more.

Filing your LLC Certificate of Organization in Massachusetts costs about $520 when filed online and $500 by mail. It takes one to two business days to be approved.

This guide provides clear and simple steps to start an LLC in Massachusetts. It will help you avoid common pitfalls and meet all legal obligations.

What Are the Steps to Start an LLC in Massachusetts?

To start an LLC in Massachusetts, you need to:

• Step 1. Choose and search for a unique name
• Step 2. Designate a registered agent in Massachusetts
• Step 3. File Massachusetts LLC Certificate of Organization
• Step 4. Create an Operating Agreement
• Step 5. Get an EIN from the IRS
• Step 6. File a BOI Report
• Step 7. File annual reports

The first five steps are the most critical steps you must follow, while the rest comes later.

But let us dive more in-depth into these steps so I can show you how to get them:

Step 1: Choose a Name for Your Massachusetts LLC

The first important step is choosing a name for your Massachusetts LLC. Your name must be unique and not too similar to existing businesses. To check availability, use the state’s corporate naming database.

Your name should contain “Limited Liability Company” or an abbreviation like LLC, L.L.C., LC, or L.C. Make sure your name isn’t “deceptively similar” to others. You also want to check trademarks to avoid legal issues.

Suppose you are a licensed professional, such as an attorney, CPA, physician, or someone in another regulated field. In that case, you can form a “professional limited liability company” or PLLC. The name of your PLLC must include the appropriate designation or abbreviation.

You can reserve your chosen name for $30. This holds it for 60 days while you finish your registration.

It is also important to consider registering a trademark. Before registering a trademark, ensuring it is not already in use is essential. You can verify its uniqueness using the Massachusetts and federal trademark search tools.

To register a trademark in Massachusetts, you must complete an application and pay a $50 filing fee. The same fees apply for renewing or amending your trademark.

Once registered, your trademark is valid for five years in Massachusetts. You can cancel it at no charge.

When choosing your name, keep it memorable and reflective of your business. A good name helps your LLC stand out in Massachusetts.

Step 2: Designate a Massachusetts Resident or Registered Agent

A registered agent is a person or company that accepts legal documents on behalf of your LLC. This includes notices and government correspondence. Having a registered agent ensures that you receive essential documents promptly.

While most states use the term “registered agent” for this role, Massachusetts is among the few states that refer to it as a “resident agent.” Despite the difference in terminology, both terms mean the same thing.

Who Can Be a Registered Agent?

You have a few options for who can be your Registered Agent in Massachusetts:

• You: You can act as your registered agent, but remember you must be available during business hours to receive documents.
• A Family Member: A trusted family member can be your registered agent.
• An LLC Formation Service: Professional services offer expertise in handling official correspondence and ensuring compliance with state regulations.
• A Lawyer: A legal service firm can also serve as your registered agent, providing additional legal support if needed.

Requirements for Massachusetts Registered Agents

Massachusetts law requires registered agents to have a physical street address, not just a P.O. Box. The address must be where the agent can consistently receive legal documents and official mail during regular business hours.

Additionally, the registered agent must be at least 18 years old and available to accept service of process. This means they must be present to handle any legal notices or court documents delivered to the LLC.

What registered agents do I recommend for Massachusetts?

I highly recommend Northwest registered agent services for obvious reasons.

They offer a range of benefits that set them apart, including a free year of registered agent service, which helps you save (about $300) on initial costs.

You’ll receive a complimentary operating agreement essential for outlining your LLC’s internal structure. My favorite part?

Northwest also allows you to use their office address for your LLC filing, keeping your address off public records and enhancing your privacy.

Their free email forwarding service ensures you stay on top of important correspondence, and their exceptional customer support is always available to assist you whenever needed.

Step 3: File Massachusetts LLC Certificate of Organization

Filing your LLC Certificate of Organization is crucial in starting your business in Massachusetts. This document officially registers your LLC with the Commonwealth and allows you to operate legally.

To file your Certificate of Organization in Massachusetts, follow these steps:

Step #1. Complete the Form: Obtain and complete the Certificate of Organization form from the Commonwealth of Massachusetts Corporate Division website.

Include the following:

• LLC Name: The legal name you’ve chosen for your business.
• Effective Date: You can specify when you want your LLC to start business operations.
• Registered Agent: The name and address of the person or company responsible for receiving legal documents.
• Business Address: The primary location where your business will operate.
• Organizer Information includes the name and address of the organizer or someone executing documents on behalf of the LLC.

Step #2: File Online or by Mail: You can file your Certificate of Organization online through the Massachusetts Secretary of the Commonwealth website or by mailing the completed form to:

Secretary of the Commonwealth
One Ashburn Place, Rm. 1717
Boston, MA 012108-1512

Step #3: Pay the Filing Fee: The filing fee for the Certificate is $520 when filed online and $500 by mail. If filing online, pay with a credit card. If filing by mail, pay with a check or money order.

After your application is reviewed and approved, your LLC will be legally formed, allowing you to focus on running your business.

Step 4: Prepare Your LLC Operating Agreement

An operating agreement is a crucial document for your LLC. It serves as an internal document that outlines how your business will run.

You should include essential details, like how members will share profits. The plan can also explain how decisions will be made and what happens if a member wants to leave.

While Massachusetts doesn’t legally require an operating agreement, it is highly recommended that one be created. It helps prevent misunderstandings among members and clarifies each member’s role.

Here are some essential components to consider:

• Ownership Structure: Listing all members and their ownership percentages.
• Management Roles: Specify who will manage the LLC. This can be member-managed or manager-managed.
• Voting Rights: Define how decisions will be made. Will all members have equal votes?
• Profit Distribution: Explain how profits and losses will be shared among members.
• Meeting Procedures: Outline how often meetings will occur and how members will be notified.
• Amendment Process: Describe how changes can be made to the agreement in the future.

It serves as your LLC’s rulebook, guiding operations and avoiding conflicts down the line. Keeping everyone on the same page is even more vital if you have partners.

Remember, while you can draft this document yourself, seeking legal advice can help ensure that all critical aspects are covered.

Step 5: Obtain an EIN for Your LLC

An Employer Identification Number (EIN) is like a Social Security number for your LLC. It helps the IRS identify your business and is necessary for various activities.

You will need an EIN to:

• Open a business banking account
• Take out a business line of credit
• Apply for certain permits
• Make contracts with wholesale vendors

In Massachusetts, obtaining an EIN is essential for managing taxes, hiring employees, and ensuring your business operates legally.

How to Apply for an EIN:

• Online: Visit the IRS website. This is the fastest way to get your EIN.
• By Mail: Fill out Form SS-4 and send it to the IRS. This option takes longer.
• By Fax: You can also fax the completed Form SS-4.
• Phone: U.S. residents can call the IRS at 1-800-829-4933 to apply.

How Much Does It Cost To Get EIN?

Obtaining an EIN is free. However, some services charge $100 or more to help you with the entire process.

How Does it Take to Obtain my EIN?

• Online: Get it immediately.
• By Mail: Expect 4 to 6 weeks.
• By Fax: Usually within 1-2 weeks.

Step 6: File a BOI Report

After setting up your LLC in Massachusetts, you must file a Beneficial Ownership Information (BOI) report. This is a federal requirement for new LLCs.

You must submit this report to FinCEN within 90 days of forming your LLC. Filing is free and can be done online at the FinCEN website.

Here’s what you need to prepare:

• Company Information: Name, address, and formation date.
• Beneficial Owners: Full names, addresses, dates of birth, and identification numbers.

Gather this information along with your LLC formation documents. This will help streamline the filing process.

Completing the BOI report is essential for maintaining compliance with federal regulations. It ensures transparency about who owns and controls your LLC. Take the time to do this correctly to avoid any potential penalties.

Step 7: File Annual Report for your Massachusetts LLC

After forming an LLC in Massachusetts, you must file an Annual Report every year to maintain compliance and good standing with the state.

This applies to all LLCs operating in Massachusetts, regardless of whether any income was generated during the year.

The fee for filing your Annual Report by mail is $500. If you file online, the cost increases to $520 due to an automatic $20 surcharge, but the online filing is processed more quickly, typically within 1-2 days.

To file, gather your LLC’s details, including:

• LLC name
• Address
• Registered Agent
• Member or manager information

The Annual Report is due each year before your LLC’s formation anniversary. To find your anniversary date, refer to the approval date of your Certificate of Organization or use the Business Entity Search on the Secretary of the Commonwealth’s website.

For example, if your LLC were formed on September 9, 2024, your Annual Report would be due each year before that date. However, you can file it at any time before the deadline.

Your first Annual Report isn’t due until the year following the formation of your LLC. So, if your LLC were approved on September 9, 2024, your first Annual Report would be due by September 9, 2025. You won’t need to file in 2024 since your LLC is newly formed.

Failing to file your Annual Report on time will mark your LLC as delinquent and out of good standing. Continued non-compliance may lead to the state dissolving your LLC.

The state typically sends a reminder to your LLC’s principal office a few months before the deadline, though this is not guaranteed.

To avoid any issues, it’s recommended that you set a personal reminder at least 90 days before your report is due.

What are the Different Methods To Start a Massachusetts LLC?

There are several ways to start a Limited Liability Company (LLC) in Massachusetts. Each method has benefits and drawbacks, so it’s important to choose one that fits your needs.

DIY LLC Formation in Massachusetts

Forming an LLC by yourself is a straightforward option. You will fill out and submit the Massachusetts Certificate of Organization and pay the required filing fee.

All by yourself, no third party!

Pros:

• Cost-Effective: You save money by not hiring anyone.
• Control: You have complete oversight of each step.
• Learning Opportunity: You gain knowledge about the process.

Cons:

• Time-Consuming: It may take longer if you are unfamiliar with the process.
• Complexity: You must ensure all forms are correctly filled out.
• Privacy issue: If you serve as your registered agent, you risk having your address out there.
• Lack of Guidance: You might miss the necessary steps.

Using a Professional/Online LLC Formation Services

Many online services can help you form your LLC. These platforms guide you through the entire process, handling most paperwork.

Pros:

• Convenient: They manage the filing, saving you time.
• User-Friendly: Most platforms have easy-to-understand instructions.
• Support Available: Many offer customer service for questions.
• Privacy benefits: Most services allow you to use their address for free, so your address doesn’t get compromised

Cons:

• Costs: You’ll pay a service fee.
• Variable Quality: Some services may not be as reliable as others.

Hiring an Attorney

Working with an attorney is another option for forming your LLC. This method ensures you have professional legal guidance throughout the process.

Pros:

• Expertise: An attorney knows the legal requirements and can avoid pitfalls.
• Customization: Your LLC can be tailored to your specific business needs.
• Support with Complex Situations: Ideal for businesses with unique circumstances.

Cons:

• Higher Costs: Legal fees can be expensive.
• Dependence on Others: You may rely heavily on the attorney’s schedule.
• Potential Delays: The process may take longer due to attorney workloads.

What is The Cheapest Alternative Way to Form an LLC in Massachusetts?

If you’re looking to start an LLC in Massachusetts on a budget, the most affordable option is to do it online. By filing the Certificate of Organization directly with the Secretary of the Commonwealth of Massachusetts, you only pay the $500 state filing fee.

This DIY approach helps you avoid the extra fees of hiring a service or lawyer, saving you money for other business expenses.

However, while DIY is cost-effective, it requires some effort. You’ll need to understand all the forms and regulations, and missing a detail could delay your application or create problems later.

Consider using a registered agent if you prefer not to handle everything yourself.

They can make the process smoother by ensuring you receive important documents and helping you stay compliant with state requirements. Although this adds a bit to the cost, it can provide valuable support and peace of mind.

Who Provides the Best LLC Services in Massachusetts?

There are a myriad of Massachusetts LLC services from which to choose. Choosing the wrong one can affect your Massachusetts LLC formation timeline—I know this from my experience using a few and researching a dozen over the years.

Here are some top-rated options you should consider:

Best Massachusetts LLC Service	Google Rating	LLC Formation Cost	Registered Agent Fee
Northwest Registered Agent	4.7/5	$39	Free for one year
Doola	4.6/5	$0 (plus state fees)	$297/year
Tailor Brands	4.4/5	$0 (plus state fees)	$199/year
ZenBusiness	N/A	$0 (plus state fees)	$199/year

Besides, the fact that other services bill you for their registered agent in the first year, and Northwest offers it for free, is a HUGE plus for me.

Northwest Registered Agent stands out among these services for several reasons. It keeps your address private, reducing your exposure to public records. Its highly-rated customer support ensures you get the help you need.

Additionally, Northwest offers transparent pricing with no hidden costs. These benefits make Northwest the top choice for forming an LLC in Massachusetts.

How Much Does It Cost To Form an LLC in Massachusetts?

Forming an LLC in Massachusetts costs around $500, which covers the Massachusetts LLC formation fees. However, there are other fees you need to be aware of.

Here’s a breakdown of the entire Massachusetts LLC costs:

Requirement	Cost
New LLC Filing Fee (Certificate of Organization)	$500 (mail), $520 (online)
Name Reservation (optional)	$30
Trademark Filing (optional)	$50
LLC Formation Service (optional)	$39 (via Northwest)
Registered Agent Fee (optional)	$0 (via Northwest)
Annual Report	$500 (mail), $520 (online)
Total Estimated Cost	$1000 – $1160

When forming a new company in Massachusetts, budgeting about $1000-$1160 for the first year is ideal. Then, if you want to go further, you can get other bells and whistles like a virtual mailbox, custom website, trademark services, premium EIN services, etc.

That said, the most significant (and essential) expense for every Massachusetts business owner is filing the Certificate of Organization, which costs $500.

Pros and Cons of Forming an LLC in Massachusetts

6 Important Things To Do After Creating Your Massachusetts LLC

After forming your Massachusetts LLC, you must take critical steps. These actions will help ensure your business runs smoothly and complies with state laws.

1. Research the Best Licenses and Permits for Your Business

You may need specific licenses or permits to operate legally, depending on your business type. Check with local and state agencies first.

You can often find requirements on the Massachusetts government website. Be sure to consider:

• City or County Permits: Check local rules as they vary by area.
• Industry-Specific Licenses: Some businesses, like food services or construction, require special permits.
• Annual Renewals: Remember that many licenses need to be renewed yearly.

Make a checklist of necessary permits and track renewal dates to avoid fines.

2. Create Business Accounts for Your Massachusetts LLC

Opening a separate bank account for your LLC is essential for keeping your business finances organized and distinct from your funds. This separation simplifies your accounting and helps safeguard your assets by clearly distinguishing between personal and business transactions.

When choosing a bank, look for one that offers business-friendly services, such as waived fees, free online banking, and other features that can benefit your business. To open the account, be prepared to provide your EIN and a copy of your Articles of Organization.

3. Understanding Massachusetts Tax Requirements and Managing Your Taxes

Every LLC in Massachusetts must comply with state tax laws. To start, you must register your LLC with MassTaxConnect for filing and paying taxes. Understand what taxes apply to your business, including:

• Sales Tax: If your business sells products, you may need to collect sales tax.
• Income Tax: LLCs may be taxed as partnerships or corporations, affecting how you report income.
• Employer Taxes: If you hire employees, familiarize yourself with payroll taxes and unemployment insurance.

Keep records of all financial transactions. This will help when filing taxes and ensure you take advantage of deductions.

4. File your Massachusetts Annual Report

After forming an LLC in Massachusetts, you must file an Annual Report every year to maintain compliance and good standing with the state.

This applies to all LLCs operating in Massachusetts, regardless of whether any income was generated during the year.

The fee for filing your Annual Report by mail is $500. If you file online, the cost increases to $520 due to an automatic $20 surcharge, but the online filing is processed more quickly, typically within 1-2 days.

The requirements for filing the annual report are pretty simple. You will need to list:

• Your EIN
• The name of the LLC
• Location of the principal office of the LLC
• The general character of the business
• Name and address of the resident agent
• The business address for each manager/member
• The name and address of each person who is authorized to sign documents on behalf of the LLC

The Annual Report is due each year before your LLC’s formation anniversary. To find your anniversary date, refer to the approval date of your Certificate of Organization or use the Business Entity Search on the Secretary of the Commonwealth’s website.

Failing to file your Annual Report on time will mark your LLC as delinquent and out of good standing. Continued non-compliance may lead to the state dissolving your LLC.

The state typically sends a reminder to your LLC’s principal office a few months before the deadline, though this is not guaranteed.

5. Get Business Insurance for an LLC

Just as you wouldn’t leave your home without coverage, your LLC also needs the right business insurance to guard against potential risks and liabilities. Insurance protects your company’s assets and ensures financial stability in case of unforeseen issues or legal claims.

Your insurance needs will vary based on your business operations.

For example, general liability insurance covers risks such as slip-and-fall accidents or property damage if your LLC operates from a physical storefront.

Conversely, if you run your business as a consultant and work remotely, you might only need professional liability insurance to cover potential service errors or omissions.

6. Setup Your Business Online Presence (optional)

In today’s digital age, an online presence can significantly benefit your business. It can boost visibility and attract new customers, contributing to your LLC’s growth.

Start by creating a professional website. This platform allows you to showcase your services and connect with customers.

Consider using social media to engage your audience. Platforms like Facebook, Instagram, and LinkedIn can enhance your visibility.

Massachusetts LLC vs. S Corp vs. Partnerships vs. Sole Proprietorship vs. Corporations

When starting a business in Massachusetts, you have several options: LLC, S Corp, partnerships, sole proprietorships, and corporations. Each has its features and benefits.

Choosing the proper structure depends on your goals, the number of owners, and how much protection you need.

Sole Proprietorship

A Massachusetts sole proprietorship is the most straightforward way to start a business. Imagine you’re running a lemonade stand on your own. You make all the decisions and keep all the profits.

However, there’s no legal separation between you and your business. If your lemonade stand faces financial trouble or legal issues, your assets, like your car or home, could be at risk.

Partnership

A Massachusetts partnership involves teaming up with one or more people to run a business together.

Think of it as joining forces with a friend to open a café. You share the profits and responsibilities, and you both make business decisions.

However, like a sole proprietorship, each partner is personally liable for any business debts or legal issues. If the business encounters financial trouble, your assets could be at risk, too. Partnerships are relatively easy to set up but require clear agreements between partners to avoid conflicts.

LLC (Limited Liability Company)

An LLC offers a blend of flexibility and protection.

Picture it as a protective umbrella over your lemonade stand. This structure separates your assets from your business, so if your LLC faces legal issues or debts, your personal belongings are generally safe.

LLCs are more formal than sole proprietorships or partnerships but offer management and tax treatment flexibility. They are ideal for small—to medium-sized businesses that want liability protection without the complexity of a corporation.

S-Corporation

An S Corporation is a more structured business form.

Think of it as a business where owners are shareholders, much like a small-scale company with multiple investors. It protects liability and allows profits to pass through to your tax return, avoiding double taxation.

This means you report the income and losses on your tax return, which can be beneficial for tax purposes. However, S Corps have stricter operational requirements and formalities compared to LLCs.

Corporation

A Massachusetts corporation is the most complex structure, suitable for larger businesses aiming for significant growth. Imagine a big company with many shareholders. A corporation offers robust liability protection and is a separate legal entity from its owners, meaning your assets are protected.

Corporations can raise capital more efficiently by issuing stock and can offer employee benefits.

However, they come with extensive regulatory requirements, formalities, and paperwork, making them more suitable for businesses with significant resources and expansion plans.

My Final Thoughts: Forming an LLC in Massachusetts

Starting an LLC in Massachusetts is an exciting step toward bringing your business idea to life. Although it might seem like many steps initially, breaking them down makes the process more manageable and ensures you cover all the essential bases.

To start an LLC in Massachusetts, follow these steps:

• Choose a unique business name.
• Select a registered agent.
• Complete and file the Certificate of Organization.
• Prepare an operating agreement.
• Obtain an EIN from the IRS
• File a BOI Report
• File annual reports

The filing fee for the Certificate of Organization is $500.

After forming your LLC, prepare for annual reports, which cost $500 yearly.

Learn More About Starting an LLC in Massachusetts

If you need additional help to start an LLC in Massachusetts, check out these useful resources:

Frequently Asked Questions

Can I change my registered agent in Massachusetts?

Yes, you can change your registered agent in Massachusetts. You must submit a form to the Massachusetts Secretary of the Commonwealth to update this information.

How do I change my Massachusetts LLC’s name?

To change the name of your LLC, you must file a Certificate of Amendment with the Massachusetts Secretary of the Commonwealth. This process is fee-based.

How do I renew my Massachusetts LLC?

Massachusetts requires you to file an Annual Report each year to keep your LLC active. Ensure this is filed by the due date to maintain good standing.

How do I dissolve an LLC in Massachusetts?

To dissolve your LLC, you must file a Certificate of Cancellation with the Secretary of the Commonwealth. This will officially end your business.

How do I add a member to a Massachusetts LLC?

You can add a member by updating your operating agreement and addressing the changes in your internal records. There’s no need to file this.

How do I add a DBA to an LLC in Massachusetts?

To add a “Doing Business As” (DBA) name, file a Business Certificate with the city or town where your business operates. This will register the new name.

Can a minor own an LLC in Massachusetts?

While minors can join an LLC, they cannot legally own one or be members without adult supervision in most cases. For specifics, it’s best to consult legal guidelines.

When is the Massachusetts Annual Report due?

Your Massachusetts Annual Report is due yearly before your LLC’s anniversary date. File it on time to maintain your business status.

Does LLC expire in Massachusetts?

An LLC does not expire by itself, but failing to file the Annual Report can lead to dissolution. Stay current with your filings to keep your LLC active.

Can a non-resident open an LLC in Massachusetts?

Yes, non-residents can form an LLC in Massachusetts. However, you will need a registered agent with a Massachusetts address.

Can I buy a house or car with my LLC in Massachusetts?

Yes, your LLC can purchase property or vehicles. For legal protection, make sure the purchases are made under the LLC’s name.

Can you have multiple businesses under one LLC in Massachusetts?

You can run multiple businesses under one LLC, but it’s advisable to register a DBA for each. This helps clarify business operations to customers and vendors.

Is Massachusetts an excellent state in which to form an LLC? Is it worth it?

Massachusetts has a solid legal framework and business resources. Assess your needs to determine if it’s the right state for your LLC.

Can one person form an LLC in Massachusetts?

Yes, a single individual can form an LLC. This is a single-member LLC and offers limited liability protection like multi-member LLCs.