Massachusetts’ pandemic didn’t stop new business growth. There was also a noticeable rise in startup activity, as with other states. This is a great time to form a Massachusetts LLC.
This guide will help you set up an LLC in Massachusetts. Continue reading to learn more about setting up your business.
Set up your Massachusetts LLC before you do anything else
There are some important details that you need to remember when filing your LLC in Massachusetts. You can read the following sections to find out what you should do before proceeding with your LLC formation.
Register Your LLC Business Name
Double-check availability of business names through the Massachusetts Secretary for the Commonwealth’s website. Multiple search options are available, including the database for corporations and a search engine that searches for previously reserved business name.
You can request a Reservation of Name Form to hold a name if you wish. You can reserve a name for up to 60 days by paying $30. You can renew your reservation for another 60 days. This form cannot be faxed. You must send it by mail or in person.
It is important to note that your business name must include “limited liability corporation” or “limited company”, or any acceptable abbreviation like.
Buy a web domain
Although it is not necessary, having a business website can be very beneficial as potential customers will often search online for brands. A website, or even a Facebook Page, can have a negative impact on customer trust and perception. This is the best time to start building your web presence.
For your LLC, hire a resident agent
Any LLC that operates within Massachusetts must have Massachusetts resident agents. They will accept important documents such as court papers on behalf of the LLC. The role is currently available to a Massachusetts resident or a company authorized for business in Massachusetts. You should expect to pay $50 to $300 per year if you hire someone.
Although some people may instinctively seek out a bargain, it might be worthwhile to pay more for this service. Ask questions and read reviews to find the best resident agent for your company.
Send Your Massachusetts Certificate of Organization
Once you have completed all the necessary steps, you can start to file forms for your Massachusetts LLC. You will need to complete a Certificate Of Organization and pay the $500 filing fees. For an additional $20, you can expedite this process by filing electronically or via fax.
An application for registration must be completed by a foreign entity that wants to establish an LLC in Massachusetts. A $500 fee is also payable. A Certificate of Legal Existence (or Certificate of Good Standing) should accompany the document. Foreign entities can submit paperwork electronically, but they are not allowed to do so by fax. Make sure to make checks payable to “Massachusetts Secretary of the Commonwealth”.
How to Establish Your Massachusetts LLC
After your LLC is approved, there are a few things you need to do. These steps are described in the next sections.
Make an LLC Operating Agreement
Although it is not required by law in Massachusetts, operating agreements are a worthwhile investment. Operating agreements are crucial for protecting your business’ long-term integrity by providing a solid foundation on how you plan to run it.
- Operating agreements usually include information such as:
- Day-to-day operations of the LLC and individual member responsibilities
- How member contributions may impact member voting
What are the new members of the LLC?
You can avoid hostility and confusion later by creating an LLC operating contract. This document can also be used to prove the legitimacy of your LLC.
Register for an Employer Identification Number (EIN).
Sometimes called a Federal Tax Identification Number, (FTIN), or Federal Employer Identification Number, an EIN is also known as a Federal Tax Identification Number. EINs are mandatory for most businesses, but single-member LLCs without employees can still get by with a social security number. An EIN is preferred, even though it protects your SSN’s privacy. EINs can be obtained free of charge through the IRS website.
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Annual Reports and Fees
Massachusetts requires that all LLCs submit a annual report and pay $500. This is vital for maintaining your business’ good standing. The fee and the report are due on or before the first day of each anniversary month following the formation of your LLC.