How to start an LLC in Massachusetts in 2024

When starting a business in Massachusetts, you must decide on a business structure, such as a corporation or an LLC. You may start an LLC for the legal protections it provides surrounding your personal assets. Members’ personal assets are protected if the business is sued or files for bankruptcy; however, taxes on revenue are calculated based on each member’s ownership percentage and then paid through each member’s personal income tax filings each year.

If this structure is the right fit for your ambitions, follow this guide to learn how to set up an LLC in Massachusetts.

1. Choose your business name
2. Appoint a registered agent
3. File a certificate of organization
4. Create an operating agreement
5. Obtain an EIN
6. Apply for licenses and permits
7. File an annual report

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7 steps to start an LLC in Massachusetts

1. Choose your LLC’s name

Before forming your LLC, you must choose a business name. Most effective business names describe or allude to the business’s products or services. Some, however, include the name or names of the owners. Regardless of the name you choose, it should end with “LLC” or “limited liability company” and be unique from other Massachusetts business names. 

Once you’ve brainstormed a potential LLC name (or, preferably, a few names), you must ensure it is not already in use or reserved in Massachusetts. To do so, search for the name using the Massachusetts Secretary of the Commonwealth business entity search tool. Next, search for the name using the Massachusetts’ search for reserved business names. You must use a different name if your name appears on either of the resulting lists. 

In addition to ensuring your chosen name is not already in use in Massachusetts, ensure it is not federally protected against infringement. To do so, search for the name in the United States Patent and Trademark Office’s trademark electronic search system (TESS). If your name appears in the resulting list after you’ve searched for it, you cannot use it to name your LLC. 

Finally, if the name is available, ensure you can market the name. To do so, search for the domain name and social media handle versions of the name online. Most domain registrars offer free tools for determining if a domain is already owned by someone else. GoDaddy, for example, offers a free domain search tool. Use this or a similar search tool to ensure your business’s domain isn’t already in use. Then, search the social media platforms you intend to use to market your business for the social media handle version of your name to ensure another company is not already using the name. 

Once you find an available and marketable name, you may want to reserve it for 60 days (with an option to reserve it for another 60 days) if you don’t plan to form your LLC immediately. This ensures other businesses do not take the name before you register it. 

To reserve a business name in Massachusetts, file an application of reservation of name form. On the form, provide your name, address and your chosen LLC name, then submit it with a check to cover the $30 filing fee. Mail the form and a check to the address that appears on the form. 

2. Appoint a registered agent

A registered agent, called a resident agent in Massachusetts, is a person or business designated to accept legal notices on your LLC’s behalf. Appointing one is a requirement by law. In many cases, you can act as your own registered agent. Or, you can hire an outside registered agent service provider.

If you choose an individual within your LLC to act as your registered agent, they must meet the following criteria: 

• Be at least 18 years old.
• Have a business address within the state of Massachusetts (not a P.O. box).
• Be available at the listed registered agent address during all regular business hours throughout the year, with no leaving for business travel or time off work.
• Be willing and able to alert responsible parties of received correspondence so they can address them in a timely manner. 

If you choose to hire a registered agent service, read our best registered agent service list to find the best fit for your company. 

3. File a certificate of organization

At this point, you can officially register your LLC with the state. The best way for most businesses to form their LLCs is by filling out an LLC certificate of organization form online and submitting the $500 filing fee using a debit or credit card.

To fill out the online form, you need the following information: 

• Your LLC’s name. 
• Your business address. 
• The purpose of your LLC.
• Your chosen registered agent’s name and address. 
• The names and addresses of your LLC’s managers. 
• Your name, address, phone number and email address (as the filer). 
• The names and addresses of responsible persons within your LLC (those who have control over the business’s finances and assets). 
• The date you wish your LLC to form. 
• Your signature. 

However, if your LLC renders professional services (as opposed to selling products), you must fill out the PDF version of the form (with the same information and submit it by fax, mail or in person. The address to submit it by mail or in person is listed on the form.

Note: While Massachusetts refers to this document as a certificate of organization, other states often call it articles of organization. 

New LLC reporting requirement alert 

The U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) has implemented a new reporting requirement for all non-exempt LLCs starting on January 1, 2024. 

The requirement is called the Beneficial Ownership Information (BOI) report and it is estimated to only take about 20 minutes to complete. 

Here’s what you need to know:

• LLCs formed before January 1, 2024 have until January 1, 2025 to file.
• LLCs formed between January 1, 2024 and January 1, 2025 have 90 days to file from the confirmed date of the businesses’ registration.
• New LLCs formed after January 1, 2025 will have 30 days to file from the confirmed date of formation.

For all details, FAQs and to file, visit FinCEN’s BOI website. 

4. Create an operating agreement

While not technically required, an operating agreement is valuable for many LLCs, particularly if you have partnerships with multiple members. This document outlines how your LLC will operate. In doing so, it provides the following benefits: 

• Dispute prevention and resolution guidance: By clearly outlining your operating procedures, your members agree on an operating direction going forward. This agreement helps to prevent future disputes. Its clarity can also guide the resolution of disputes among members if they arise.
• Liability protection: An operating agreement outlines the ownership percentages of each member, thereby confirming the share for which each member is responsible. It also confirms the business structure as a limited liability company, helping solidify each member’s liability protection. These two data points ensure that members are only held responsible for their share and that their personal assets are protected in the event the company is sued or files for bankruptcy.
• Control: LLCs that do not have operating agreements must default to state rules regarding LLC operating procedures, which may contradict the owners’ best interest or wishes. An operating agreement is a legally-binding document that states the LLC’s operating procedures and overrides state rules, giving members more control over the LLC’s direction and future.

Key concepts that are often outlined in an operating agreement include: 

• The business’s name and LLC business structure.
• Members’ identities and contact information.
• Members’ initial contributions and ownership percentages.
• Members’ powers, responsibilities and voting rights.
• How new members can be inducted into the LLC.
• The accounting methods the LLC will use (accrual or cash basis, for example).
• The LLC’s non-compete clause.
• Members’ signatures.
• How profits and losses are distributed.
• How disagreements will be resolved (through arbitration or mediation, for example).
• Member buy-out rules or how the transfer of power would occur should a member pass away. 
• How the LLC can be dissolved. 

Many LLC formation companies offer templates you can use to create the first draft of your operating agreement. For example, Rocket Lawyer and Northwest Registered Agent offer free operating agreement templates. Rocket Lawyer even asks you questions and fills out the template for you, then allows your members to digitally sign it and print it for company records. 

However, before your members sign the legally-binding agreement, we strongly recommend having a business lawyer review the document to ensure it meets your LLC’s unique needs. LLC formation companies such as Rocket Lawyer and LegalZoom offer legal consultations to assist in completing such business-formation tasks.

5. Obtain an employer identification number (EIN)

An EIN is a federal tax ID number for a business, similar to your personal Social Security number. An EIN is required for performing many financial business tasks, such as opening a bank account, applying for business licenses and permits, applying for a loan, hiring employees and filing annual tax returns.

Applying for an employee identification number (EIN) is a very quick and easy process for most LLCs. You can get your EIN for free using the IRS’s apply for an employer identification number (EIN) online page. The process takes ten to fifteen minutes but must be completed in one online session. 

Once you’ve submitted the online form, you will receive an EIN immediately on a confirmation page. Download and print this page, and store it with your other LLC documents for future use.

6. Apply for required licenses and permits

Depending on your municipality and business activities, you may need to apply for licenses or permits from your city, county or the Commonwealth of Massachusetts to operate your LLC. You may also need to pay filing fees for these licenses. 

There are two sources that can help you determine what business licenses or permits you may need. These include the Division of Occupational Licensure and the professional licenses and permits page. Here is how to use each resource: 

• Division of Occupational Licensure: This page offers a list of boards that oversee industry-specific licensure. For example, it lists a board for architects, inspectors, electricians, massage therapists, accountants and funeral directors. If you click on the board name relevant to your industry, you will be directed to a page with contact information. Use this contact information to inquire about licensing, permit requirements and application procedures. 
• Mass.gov professional licenses and permits page: This page also offers a list of industries. When you click on an industry, you will access a more comprehensive list of industry-specific licenses. For example, if you click “health care licenses,” a drop-down menu shows a list of licenses applicable to the healthcare industry, such as respiratory care and nursing home administrator licenses. Click on a license to learn how to apply for it. 

7. File an annual report

Massachusetts LLCs must file an annual report to remain in good standing with the state. This form helps the state keep all of your LLC’s information up to date for public knowledge. Your limited liability company annual report form must be submitted on or before your certificate of organization filing anniversary. You can complete and submit a report online using the Massachusetts annual report system (OARS). 

To fill out the form, you must include the same information you provided when filing your certificate of organization and correct any information that has changed. For example, if one of your members has had an address change, you must change that address on the annual report form. You may need to save up each year to file this report. The filing fee is $500, payable to the Massachusetts Secretary of State. 

Featured LLC service offers

ZenBusiness

Learn More

Via ZenBusiness’ website

Free version available

Yes

Lowest published package price

$199

Live chat

Yes: Human

LegalZoom

Learn More

Via LegalZoom’s website

Free version available

Yes

Lowest published package price

$249

Live chat

Yes

Northwest Registered Agent

Learn More

Via Northwest’s website

Free version available

No

Lowest published package price

$39

Live chat

Yes

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