Everything You Need to Know About Massachusetts Incorporation

The process of founding a company that may legally function in the state of Massachusetts is known as MA incorporation.

In Massachusetts, How to Form a Corporation

In Massachusetts, there are a few processes involved in founding a company.

Choose a Name

First, you must choose a name for your company. Massachusetts corporate names, in particular, must meet the following criteria:

Names must end in “Limited,” “Ltd,” “Incorporated,” “Inc,” “Corporation,” or “Corporation.”

No phrase in the name may indicate that the company is utilised for anything other than a lawful commercial purpose.

Names must be distinct from those of any existing domestic or international businesses that are presently registered with the Massachusetts Secretary of Commonwealth.

Make a Certificate of Incorporation.

At least one member of the company must sign the certificate of formation. You must then submit it with the Secretary of the Commonwealth’s Corporations Division.

Select Your Directors

To assist manage and administer the organisation, your Massachusetts corporation will need at least three directors. However, if you have fewer than three shareholders, you may have the same number of directors (you cannot have fewer).

There are no age or residency restrictions for serving on a Massachusetts corporation’s board of directors.

Give the Incorporator a name.

The incorporator is the person in charge of the incorporation procedure. At the very least, you’ll need one. This individual must be above the age of 18 but is not required to be a Massachusetts resident.

Determine Your Shares

The maximum number of permitted shares for the minimal incorporation fee in Massachusetts is 275,000. That being said, there is no minimum amount of money required to start a firm.

Select the Registered Agent.

All Massachusetts companies are required to have a registered agent and a registered office. The state will send crucial service of process notifications to this address.

Submit the Annual Report

Every company in Massachusetts is required to submit an annual report with the Corporations Division by March 15. The only exception is if your fiscal due date with the IRS differs, in which case you have until that date to file.

Your annual report should contain all of the information that was included in your certificate of incorporation, and it costs $125 to submit by mail and $100 to file online.

You will lose your permission to operate in the state if you do not submit the yearly report. To avoid you from forgetting, the Massachusetts Secretary of Commonwealth sends out postcard reminders. If you fail to file on time, you will be charged an extra $25 cost.

Massachusetts Corporate Tax Rates

Once you’ve been designated as a company, you’ll be required to pay state income taxes. The current corporate net income tax rate is 9.5 percent, with a $456 minimum payment. You’ll also have to pay a $2.60 excise and property tax for every $1,000 in state assets your company holds. This tax also applies if you are a foreign company doing business in Massachusetts.

In Massachusetts, you may choose S company tax status. The S election is automated, which means there are no paperwork to fill up or standards to satisfy.

A federal tax identification number, often known as an employer identification number, is required to file your taxes in Massachusetts (EIN). The IRS gives an EIN to each firm, and this number serves as your company’s Social Security number. You’ll also need one if you’re employing someone or creating a bank account.

How to Dissolve Your Massachusetts Corporation

You may choose to dissolve your Massachusetts company under specific circumstances. Fortunately, the Massachusetts Department of Revenue no longer requires you to get a “Certificate of Good Standing.” Instead, you’ll only need to notify the Commissioner of Revenue of your intention to dissolve.

You may do this by writing a letter on your company’s letterhead outlining your intentions. It must be signed by a business official and contain a copy of the vote that authorised the dissolution. When you have finished, mail it to the DOR Customer Service Bureau at P.O. Box 7010, Boston, MA, 02204, Attn: Corporate Dissolutions.

The last step before your dissolution is to submit your last corporation excise tax return.