Starting a Business in MassachusettsYou’re about to embark on a long and exciting journey, one full of hard work and rewards: starting a new business.

With wide eyes and big dreams, you’re about to enter the world of business ownership.

But beyond the initial thrill of the startup decision, there’s a lot to consider. In fact, if you’ve never done it before, starting a business can seem like an intimidating mountain of work. Out of all your responsibilities and tasks, you might not even know where to start.

But have no fear. The good news is that once you have everything planned out and understand the process, the formation process is smooth sailing. And this is your go-to guide.

Everything you’ve been wondering about, everything you need to do, every question you have – it’s all right here. By the time you’re through these 16 steps, you’ll be a bonafide business owner who’s prepared for sustained success.

Massachusetts Entrepreneur Hack

When you form a business through business formation services (Example: ZenBusiness and LegalZoom), they’ll register your business with the state and help you check off most of the startup-steps in this list. They assist you with everything from building a website to opening a business bank account.

If you’d like to cut through the clutter and compare the best LLC services, see our comparison of the top 7 deals.

1) Write a Business Plan

Jumping into this endeavor without goals, directives, or a sense of direction can lead to a scattered, unproductive business.

A business plan lays the groundwork for your future success. It helps you analyze key elements of your business and forge pathways to achieve your goals. Here are a few things you should consider including in your business plan:

  • Executive Summary (a separate document that gives a complete overview of your business’ purpose, plans, goals, competition, opportunities, etc.)
  • Company description
  • Market Analysis (opportunities, competition, etc.)
  • Managerial or organizational structure
  • Products and/or services
  • Marketing strategies
  • Funding goals
  • Financial projections

Business plans aren’t just great for internal operations, but they give your business legitimacy in front of potential investors, customers, partners, and more. Need help? Check out this guide from the U.S. Small Business Administration.

2) Decide on a Business Name

You might’ve come up with the perfect name right away. If so, consider yourself lucky.

Sometimes, deciding on a business can be difficult, requiring brainstorming meetings and late-night rap sessions. That’s because your name is your business’ identity and reputation. It should be something that’s unique and memorable but also defines your business purpose.

Each business structure has its own unique naming requirements. If you go with an LLC, for example, your name must include the words “Limited Liability Company,” or an abbreviation like “LLC.” Corporation names, on the other hand, must include “corporation,” “incorporated,” “company,” “limited,” or an abbreviation thereof.

Moreover, your desired name can’t already be in use. When you’ve settled on one, use a business entity search to ensure that it’s available. If no other business is currently using it, you’re free to reserve your name or use it on your formation documents.

Business Name Search

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3) Decide on a Legal Structure

There are only a few types of business structures, but each one dictates some important parts of how your business will run.

The most popular types are the sole proprietorship, general partnership, limited liability company (LLC), S corporation, and C corporation. Most small businesses go with the LLC because of its unique blend of flexibility and personal asset protection.

However, you shouldn’t make this decision without reading up on all of your options. We’ve done plenty of research on each business type and developed side-by-side comparisons. Check out our LLC vs. Corporation and LLC vs. Sole Proprietorship comparison guides for a closer look.

Want to form an LLC for free? ZenBusiness will file all LLC formation paperwork for $0 + state fee. No catch, just savings.

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4) Choose a Resident Agent

The Secretary of the Commonwealth needs a point of contact for your business, someone who will be available at your registered office address during typical business hours – 9am to 5pm.

This person is called a resident agent, and they serve as an intermediary with the Commonwealth, receiving all of your company’s important legal communications and relaying them on to you. The Massachusetts resident agent ensures that no important Commonwealth documents, deadlines, or payments fall through the cracks, so you’ll want to choose a person or company you trust.

You can choose either an individual or a business entity as your resident agent in Massachusetts, but they must:

  • Be an individual Massachusetts resident or a business entity authorized to do business in Massachusetts.
  • Have a physical address in Massachusetts (P.O. boxes are not allowed)
  • Have a mailing address in Massachusetts (may be identical to the physical address)

This person is the one responsible for maintaining your business compliance, so it’s a good idea to choose someone who understands the ins and outs of business maintenance, like an attorney, manager, or other professional. But if you’d rather appoint a family member or friend, they are possibilities as well.

Or, you can choose a resident agent service instead. These companies take care of all your resident agent responsibilities, and some will even handle your business formation and annual reporting as well.

Important: You must continuously maintain a resident agent on file with the Secretary of the Commonwealth. If your agent resigns or you appoint a new one, you’ll need to notify them by filing the appropriate documents.

Special Offer: Right now ZenBusiness is offering a discounted rate for just $99 the first year (normally $199) to act as your agent and handle legal responsibilities.

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5) Register Your Business

This is the big one, the step that officially creates your business. No matter which business type you choose, you’ll need to register it with the Secretary of the Commonwealth.

LLCs: When you’re ready to get your LLC on record, you’ll need to file a Certificate of Organization with the Commonwealth.

This Massachusetts LLC filing isn’t cheap. It carries a filing fee of $500, but it’s a one-time filing and an important one at that. If you choose to file online or by fax, the Commonwealth automatically adds on a $20 expedited processing fee.

Corporations: The filing options and processes are the same for corporations, but the forms and fees differ. Instead of the Certificate of Organization, you’ll file an Articles of Organization. And rather than a flat $500 fee, you’ll pay $275 for the first 275,000 shares of your company, and $100 for each additional 100,000 shares (or fraction thereof).

Sole Proprietorship/General Partnership: There are no official forms or fees to register as a sole proprietor or general partnership. Simply start doing business and that’s it! While this is obviously faster and easier, we recommend incorporating your business because of the personal asset protection LLCs and corporations provide.

Foreign Entities: If your business is already up and running in another state, Massachusetts will consider it a “foreign” entity rather than a “domestic” one. In this case, don’t worry about the Certificate of Organization or Articles of Organization. Rather, you’ll need to go through the foreign qualification process, which involves filing a “Foreign LLC Application for Registration” for $500 or a “Foreign Corporation Certificate of Registration” for $400.

6) Get an EIN

The Employer Identification Number (EIN) is your ticket to doing Commonwealth and federal taxes. It’s a nine-digit number, much like a Social Security Number, that identifies your business on tax documents.

If you’re forming an LLC, it will be considered a “pass-through” entity, so the business itself won’t pay federal income taxes. Instead, you and the other members will report income and losses on your personal tax returns.

But this doesn’t mean you can go without an EIN. If your LLC pays any type of business taxes – like Sales, Use, or Unemployment Taxes – or hires employees, you’ll need to get one.

Unsure if you need one? The IRS provides a useful “Do I need an EIN?” link on this page, where you can also apply for an EIN. If you go through the online application process, you’ll receive your number immediately.

Otherwise, you can submit a Form SS-4 by fax to (855) 641-6935 or by mail to :

Internal Revenue Service Operation

Attn: EIN Operation

Cincinnati, OH 45999

7) Open a Business Bank Account

LLC and corporation owners are required to keep their personal and business finances completely separate, or they risk losing their personal asset protection. To do so, you’ll need a business bank account.

The good news is that opening a business bank account is pretty simple. Just pay a visit to your bank’s local branch and sit down with one of the bankers there. You will need to present your formation documents, an EIN number, and some personal information. Then, you can direct all of your business income and expenses to that account instead of a personal one.

It doesn’t really matter which bank you choose, whether it’s a national giant like Chase or Bank of America or a small, local bank. However, it’s usually easiest to go with the one where you have existing accounts.

8) Handle Any Tax Obligations

Ah, taxes. They’re always part of the picture, especially when you run a business.

Familiarizing yourself with your business’ tax requirements will help you establish a solid financial plan going forward. LLCs don’t need to file a corporate tax return and pay federal income taxes, so you’ll handle these taxes as part of your personal return.

Corporations, on the other hand, will need to file a Corporate Income Tax Return and a Corporate Excise Tax, while sole proprietorships/general partnerships will need to pay self-employment taxes.

Massachusetts doesn’t impose a franchise tax for the privilege of doing business in the Commonwealth, but there are a few other taxes your business may owe depending on its activities:

Sales and Use Taxes: Every business that sells goods in the Commonwealth must pay Sales and Use Taxes at a rate of 6.25%. provides a helpful guide containing everything you need to know about these taxes.

Withholding Tax: If you hire employees, you’ll need to withhold a certain amount from their wages to pay their personal income tax. You can calculate your business’ Withholding Tax using this document.

Unemployment Insurance Contributions: Any Massachusetts business that hires employees must also make quarterly contributions to Unemployment Insurance.

Other Taxes: Your business activities and/or products might require it to pay other various taxes, like a Cigarette and Tobacco Excise or a Satellite Service Excise. Find a full list here.

What’s nice is that Massachusetts makes it fairly easy to apply for all your business taxes in one place: MassTaxConnect

9) Find an Accountant

Sometimes it’s easier to hand off your financial responsibilities to a professional. Not only will an accountant ensures that your taxes are filed and paid correctly, but they might also find a few ways to save your business money.

Bookkeeping and tax procedures are time-consuming and require some specialized knowledge. Balance sheets, financial reports, cash flow, audits, and much more – an accountant can ensure that your company operates smoothly and streamlines its expenses.

This can be expensive depending on the complexity of your finances, but the benefits an accountant offers can be well worth it.

10) Create an Operating Agreement

An operating agreement constructs a framework of procedures and standards for your business. This is where you can lay out processes for member conduct, asset allocation, compensation policies, voting procedures, dissolution, and much more.

While operating agreements aren’t technically required in Massachusetts, they are essential to your business’ stability and success. They provide a safety net in legal disputes and legitimacy in front of banks, courts, government agencies, and other businesses.

You can either draft one yourself using an online template, or you can hire an attorney or an incorporation service to take care of it for you.

Once you’ve drafted your agreement, it must be approved by each of your LLC’s members, then filed with the rest of your business documents. You do not need to submit it to the Secretary of the Commonwealth.

Example: ZenBusiness is an incorporation service that will register your company and offer an operating agreement or corporate bylaws in addition to over 25 important business documents.

11) Acquire the Necessary Licenses

After filing your formation documents, your business is legitimate, but it might still need specific licenses before opening its doors in Massachusetts. The types of license your business needs, if any, depends on its activities and location, but there are a couple of general types you should know:

Professional/Occupational Licenses: Certain vocations must obtain licensure from Commonwealth boards before commencing business in Massachusetts. Unsure if this applies to your profession? You can find a complete list on the Professional Licenses and Permits page of

Other Business Licenses: Your business activities might dictate the need for other specific licenses or permits, like those pertaining to the environment, transportation, health, construction, and more. You can find them all here.

Local Licenses: Your specific city, county, or municipality might have its own licensure requirements. Take a look at your local government’s website to find out.

12) Consider Business Insurance

Even though it’s not pleasant to consider, there’s always a chance that unforeseen events might take a toll on your assets.

While forming an LLC or corporation offers some personal asset protection, additional business insurance can also protect your business assets in cases of lawsuits, damages, etc. You can acquire insurance for your business products, vehicles, specific occupations and much more.

If you hire employees, you’ll also need to get workers’ compensation insurance. has a useful guide for determining which forms of insurance your new business might need.

13) Build a Website

Your company’s digital presence is just as important as its physical one. Like it or not, most potential customers will find your business online, and if you don’t exist online, you’re missing out.

But don’t worry, you don’t need to be an HTML or web design expert to build a website. Sites like WordPress and Squarespace make it easy to construct an elegant and responsive website, no coding necessary. But if you’re not comfortable or confident doing it on your own, you can always hire a professional web designer to take care of it for you.

Quick Note: As mentioned earlier, if you’re looking to build a business website, there are a handful of good business incorporation services that have tools or partnership offers that can help you get started, like ZenBusiness or IncFile.

14) Launch Social Media Accounts

Making your mark on the digital landscape doesn’t start and end with your website. Most successful businesses also have a robust social media presence on multiple platforms. Facebook, Twitter, and Instagram are all great ways to connect organically with potential customers and develop your brand voice.

Just don’t forget to publish consistent social media content, or you’ll have trouble building a base of followers.

15) Understand Ongoing Massachusetts Requirements

After you’ve launched your business, things will likely be moving at 100 miles per hour as you evolve and grow. But in all of the excitement, you can’t forget your Commonwealth’s ongoing compliance requirements. Every state has its own annual or biennial business requirements.

Every Massachusetts business is required to submit an Annual Report by its anniversary date (the date it was initially formed) each year. The form costs $500 to submit via mail and $520 to submit online or by fax. Make sure you file a report every year, or your business could lose its good standing with the Commonwealth and potentially be administratively dissolved.


16) Check Out Massachusetts Small Business Resources

You’re not on this journey alone. There are plenty of free resources available to make starting and growing your business a smoother, easier process. is an incredibly helpful tool for budding businesses, providing resources like networking events, loan opportunities, business development centers, and much more. Take a look at this page for the SBA Massachusetts district office, which contains a variety of information and support. You might find this state-specific resource guide especially effective. With this guide bookmarked and the resources from, you’ll be in the fast lane to business success and longevity.

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