You did it. Your Massachusetts LLC is officially up and running, ready to take on challenges, roll in the profits, and change the world.
There’s no doubt that this is an exciting time in your business journey. After starting your LLC, it’s easy to get carried away in all the excitement and expectations. After all, as a new business owner, you’ve got a lot on your plate.
But the state does too. They need to keep updated records on thousands of businesses so that they can effectively reach out with any important tax or legal communications down the road. How do they do it? With your cooperation, of course.
In Massachusetts, an LLC’s annual report consists of two parts: a Franchise Tax and a Public Information Report. Each LLC must submit these filings to the Massachusetts Comptroller every year to keep their information current. Unsure how to go about it? Never even heard of it? No worries at all. That’s why we’re here. Keep reading for everything you need to know.
For brevity’s sake, we’ll refer to these two combined filings as the “Annual Report” in this guide.
What is the Massachusetts Annual Report? Why is it Important?
Consider an Annual Report the Commonwealth’s yearly checkup on your LLC. It’s similar to a census in that its purpose is to collect the necessary contact and structural information about each Massachusetts business.
Each state has its own annual reporting requirements, and some don’t even require them. But in most states, you’re required to submit one per year that includes your LLC name, principal office address, resident agent information, and member/manager names and addresses. Whether you run a domestic or foreign LLC, you should plan on submitting an annual report.
Don’t be intimidated, but it’s not something you want to take lightly. This is how the Commonwealth updates your LLC’s record with the most recent information. They need to know how to reach you with important information about your business status, upcoming filings, taxes, and service of process.
For example, if you change your resident agent, or your current agent resigns, you’ll need to keep the Commonwealth informed so they can update their contact information. Miss one of their communications and your LLC in Massachusetts might end up falling out of good standing or, even worse, administratively dissolved.
Moreover, keeping your information current will help other businesses and potential customers find you. If the Secretary of the Commonwealth has the most updated data on record, people can find your business by performing a name search.
How Much Does the Massachusetts LLC Annual Report Fee Cost?
If you’re putting together a budget for all your LLC’s costs – like formation costs, name reservation fees, and initial operating expenses – it’s important to include annual filings like this one, just so that there are no surprises.
Costs vary from state to state. Some are free while others can be several hundred dollars. Massachusetts has one of the highest annual reporting fees in the country: $500 for mailed filings and $520 for online or faxed submissions. You’ll be paying this fee every year, so make sure you set aside funds for it.
Due Date and Frequency for an Annual Report in Massachusetts
Every Massachusetts LLC must file an Annual Report once per year by its anniversary date. This is the date that you originally formed your business. If you can’t remember your LLC’s anniversary date, check your Certificate of Organization – the date that it was approved will be your due date.
You won’t need to file an Annual Report until the year after you form your LLC. Let’s say your Certificate of Organization was approved on May 15, 2019. You wouldn’t need to file a report until May 15, 2020.
What Happens if You Don’t File?
You might be thinking, “that sounds like a pain. How bad could it be if I just fly under the radar?” The short answer: don’t try it. Failing to file your Annual Report can yield some serious consequences.
Miss your due date and the Commonwealth will tack an additional $25 fee onto your report. More importantly, it will cause your LLC to lose its good standing. Eventually, the Commonwealth might even administratively dissolve your business, so make sure to file on time!
Now that we’ve covered the basics, let’s get into the details. When you’re ready to file your Annual Report, here’s the required information:
- Federal Identification Number
- Exact LLC name
- Principal office address
- Street address where LLC records are maintained
- The general character of the business
- Latest date of dissolution (if applicable)
- Resident agent name and address
- Name and business address for each manager
- Name and business address for each person authorized to execute LLC documents
- Name and business address for each person authorized to “execute, acknowledge, deliver and record any recordable instrument purporting to affect an interest in real property”
- Filer contact information (postal address, phone number, and email address)
It’s slightly more robust than the average Annual Report but contains information that should be fairly accessible. Collect everything here beforehand and you’ll have no problem breezing through the filing.
Have your information ready? You’re through the hardest part. Now all that’s left is to submit your Annual Report to the Secretary of the Commonwealth. You have four filing options: online, by mail, by fax, or in-person.
Online Filing: Head over to the Corporations Online Filing System and enter your Customer ID Number and PIN. If you don’t have one or both of these numbers, email the Corporations Division at firstname.lastname@example.org. They will provide you the necessary numbers right away. Once you’re logged in, follow the instructions to enter your information, pay your fee with a credit/debit card, and you’re all set.
Filing by Mail: Download and complete a hard copy of the Annual Report and write a check or money order addressed to “Commonwealth of Massachusetts.” Mail both items to:
Secretary of the Commonwealth
One Ashburton Place, Room 1717
Boston, Massachusetts 02108-1512
Filing by Fax: Download and complete the paper form and create a Fax Voucher Cover Sheet. Then, fax both items to (617) 624-3891.
Filing In Person: Once you’ve completed a hard copy of the Annual Report and prepared your payment, you may also hand-deliver it to the address listed above.
Does the Commonwealth Send Reminders?
Reminders are always nice. They help you stay on top of your business requirements and ensure that you won’t fall out of good standing.
As a courtesy, the Secretary of the Commonwealth’s office will mail a reminder to your principal office address. But it can be helpful to set up your own reminders as well. Make a note of your due date in a place you won’t forget it, like in a planner, on your phone, or on your calendar.
Can I Hire a Service to Handle it?
You probably have a full plate as it is, and the thought of adding one more responsibility to your to-do list might make you shudder. You’re not alone.
Plenty of other LLC owners have outsourced their reporting duties to LLC services. These companies will take the entire process off your hands, handling your Annual Report each year. If that piques your interest, we recommend ZenBusiness, which is an experienced and trustworthy LLC company.
But their services aren’t restricted to forming an LLC or managing Annual Reports. They can also help you form your business, draft an operating agreement, handle resident agent responsibilities, and much more, all for a reasonably low price.
If thinking about your LLC responsibilities ties your stomach in knots, let ZenBusiness take some of those worries off your plate.
There you have it, everything you need to know about Massachusetts’s reporting requirements. Follow this guide to a T and your LLC will be prepared to operate smoothly and in good standing long into the future.
And remember, if at any point it seems overwhelming, you’re not alone. A good LLC service like ZenBusiness (or LegalZoom) can be a valuable resource, taking care of all the little details, so you can focus on growing your business.