How to Form an LLC in Massachusetts

Co-authored by Clinton M. Sandvick, JD, PhD

Last Updated: January 31, 2023 References

A limited-liability company ("LLC") is commonly referred to as a "hybrid" business structure, meaning that it shares characteristics of both a corporation and a sole proprietorship. It allows its owners to insulate themselves from personal liability for business debts, does not require the payment of separate business taxes (the tax "passes through" to its owners), allows for a great deal of flexibility with regards to its organizational structure, and is subject to fewer regulations and restrictions than are other types of business structures.^{[1]
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Research source} Establishing such a company in Massachusetts is a rather straightforward process.

Part 1

Part 1 of 3:

Drafting the Certificate of Organization

1
Obtain the Certificate of Organization form. An LLC is formed in Massachusetts after its owners complete and file a Certificate of Organization for the LLC with the Corporations Division of the Secretary of the Commonwealth. The Corporations Division provides a Certificate of Organization template on its website to use when drafting this document.^{[2]
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- The first information this form asks for is your LLC's federal employer identification number. Leave this field blank for now, as you cannot apply for such a number until your LLC is officially formed.
2
Choose a name for your LLC. One of the more important things you will have to do during this process is to choose a name for your LLC. When choosing your LLC's name, you must adhere to the following guidelines:^{[3]
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- The name must contain the words "limited liability company," "limited company," "L.L.C.," "L.C.," "LLC," or "LC."
- The name may contain the name of a member or manager.
- The name of your LLC must be distinguishable from any name currently reserved or registered with the Secretary of the Commonwealth, and from any state or federal agency.
3
Check to see if your chosen name is available. Before you submit the Certificate of Organization, you should check to see if your chosen name is available under state law. You can do this either by contacting the Corporations Division in Boston, MA at (617) 727-9640^{[4]
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- You can file an optional form along with a filing fee of $30 to reserve a name for 60 days.^{[7]
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  Research source} At the end of that period, an additional $30 will reserve the name for another 60 days.
- Try to have a few alternate names for your company in case your first choice is unavailable.
- During this search, you might also want to check to make sure the relevant URL is available so your LLC's online presence will have an appropriate domain name.^{[8]
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You must provide a street address within the Commonwealth of Massachusetts at which your LLC will keep and maintain its business records.^{[9]
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In this space, you will provide a statement outlining the business objectives of your LLC (i.e., what it will be doing to make money).
You must also provide on the form the latest date on which your LLC will be dissolved and will cease to exist in the eyes of the law. If you don't want to put an expiration date on your LLC at this time, leave this part blank.
7
Designate an agent for service of process. You must also indicate the individual who will officially receive any legal documents on behalf of your company. You must provide your agent's name and business street address on the form.
- Your agent must reside in the Commonwealth of Massachusetts.
- Your agent must provide written consent either on or attached to the Certificate of Organization.^{[10]
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Provide additional names and addresses. If you have managers for your LLC who will be based at a business address other than the one indicated for your LLC, you must provide their names and business addresses in the Certificate of Organization. You must also do this for any additional people that are authorized to execute and file documents with the Corporations Division.^{[11]
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- If your LLC has no managers, you must provide the name and business address of at least one person authorized to execute and file documents with the Corporations Division.
9
Fill out optional sections. In addition to the above information, which is required, you may also fill out the optional sections of the Certificate of Organization. If you wish to authorize a person to officially handle matters dealing with the recording of real property, you may list their name and business address if it differs from that of the LLC.
- Your LLC's Certificate of Organization can also include any provisions relating to the internal operation of your company so long as they are permitted by law. For example, you may want to add provisions relating to how major business decisions will be made or what happens if your company is dissolved.
10
Sign and file your LLC's Certificate of Organization. The person (or people) forming the LLC must sign the form. After you have reviewed the form and made sure the information you provided is complete and accurate, you can file the form by mailing it to the address listed on the top of the form. You also have the option of filing online.^{[12]
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- You must also pay a filing fee of $500. The fee is $520 if you are filing online.
- This document must be filed in duplicate.^{[13]
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Part 2

Part 2 of 3:

Setting Up Your LLC

1
Draft an Operating Agreement for your LLC. After you have filed your LLC's Certificate of Organization, there are several other steps you should take before you actually start doing business. The first of these should be to draft an Operating Agreement between the members of your LLC. This document will govern how your LLC will be operated.^{[14]
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State of Massachusetts
Official website for the State of Massachusetts

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- This agreement should outline things like the roles of each member, voting rights, how new members will be added or existing ones removed, how profits and losses will be allocated, capital contribution for each member, and how the Operating Agreement itself will be amended.^{[15]
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- You do not have to file this agreement with the state.^{[17]
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2
Get an Employer Identification Number from the IRS. If your LLC has more than one member, you will need this number so your LLC can pay federal and state taxes properly, hire employees, and open a company bank account.^{[18]
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Internal Revenue Service
U.S. government agency in charge of managing the Federal Tax Code

Go to source}; (2) by contacting the IRS at (800) 829-4933; or (3) by completing and mailing in Form SS-4 to the address listed on the form.^{[20]
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Internal Revenue Service
U.S. government agency in charge of managing the Federal Tax Code

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- Make sure your LLC is legally formed (i.e., your Certificate of Organization has been submitted and approved) before applying for an Employer Identification Number.^{[21]
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  Internal Revenue Service
  U.S. government agency in charge of managing the Federal Tax Code
  
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You will want your LLC to have its own bank account, separate from the bank accounts of its members/managers. The requirements of individual banks vary, but you will likely need, at minimum, your LLC's Employer Identification Number and a copy of its Certificate of Organization.^{[22]
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Part 3

Part 3 of 3:

Submitting Additional Filings

1
Obtain necessary business licenses and permits. You will need to acquire any licenses or permits necessary to conduct your LLC's particular business from the county or city clerk's office for the jurisdiction in which the LLC is based. Contact these offices to see what additional licenses/permits your LLC will need, if any.
- For example, if your LLC will be based in Boston, you will have to apply for a business certificate and pay a fee of $65 to legally conduct business within city limits.^{[23]
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2
File with the appropriate federal, state, and local governmental agencies. Depending on the business purpose of your LLC and the jurisdiction in which you organize, you may have to file additional forms relating to LLCs with certain governmental agencies. Each industry is regulated differently—as is each local jurisdiction—and so it is best to ask an attorney or accountant for assistance in this matter.
- You can also try contacting your local Chamber of Commerce for advice or consulting the U.S. Small Business Administration's website.^{[24]
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  U.S. Small Business Administration
  U.S. government agency focused on supporting small businesses
  
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State law requires your LLC to register with this agency upon formation for state tax purposes if your LLC will have employees, will sell goods, or will collect sales tax.^{[25]
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4
File your LLC's Annual Report. State law requires every LLC to submit an Annual Report every year in order to continue operating as an LLC in Massachusetts, which largely serves to make sure the information you filed in your Certificate of Organization remains currently accurate. This report must be filed on or before the anniversary date of the filing of the original Certificate of Organization.^{[26]
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- You can either fill out and mail in the form provided on the Corporations Division's website to the address on the top of the form^{[27]
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- You must also pay a filing fee of $500 when submitting your Annual Report.
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Tips

If your LLC will provide professional services, use the Certificate of Organization form for professional LLCs instead of the default one.^{[29]
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Research source} There are several other regulations such an LLC must follow when filling out its Certificate of Organization—such as services to be provided, names of certain practitioners, and statements of liability—detailed on the Corporations Division's website.^{[30]
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Research source} Such an LLC must also use a specific form when filing its Annual Report.^{[31]
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All forms necessary to form and operate an LLC in Massachusetts are provided online on the Corporations Division's website.^{[32]
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Warnings

Setting up a LLC can be a complicated process and, depending on the nature of your business, a thorough understanding of local, state, and federal laws and regulations and how they apply to your LLC is essential. It is best to consult with an attorney with LLC experience before you begin this process.

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