How to Form a Corporation in Massachusetts

If you want to form a corporation in Massachusetts, you need to take several important legal and procedural steps to start your business. Among other tasks, you must register your corporation with the state, prepare internal corporate documents, appoint company directors, and issue stock.

You can use our Online Corporation Service to start your corporation. This online service will provide you with everything you need including a corporate name check, articles, bylaws, a corporate records book, an incorporator's statement, minutes of the first meeting of the board of directors, stock certificates, and a stock transfer ledger.

1. Choose a Corporate Name

Your Massachusetts corporation must follow state naming laws for corporations. For instance, your corporation's name must contain one of the following terms or its abbreviation:

• "corporation"
• "incorporated"
• "company," or
• "limited."

Alternatively, your corporate name can include words or abbreviations in another language that have a similar meaning to the ones above. Moreover, your corporation's name can't state or imply that your corporation is organized for some purpose other than the one specified in its articles of organization. (Mass. Gen. Laws ch. 156D, § 4.01 (2024).)

In addition, your corporation's name can't be the same as any other business name already on file with the Secretary of the Commonwealth of Massachusetts (SOS). These business names include legal names, trademarks, and fictitious names (also called "DBAs"). Search for available names in Massachusetts using the SOS's business entity database and reserved business name database.

You can reserve a corporate name, including a fictitious name, for 60 days. To reserve a corporate name, file an Application of Reservation of Name with the SOS. You must apply by mail or deliver it in person. As of 2024, the filing fee to reserve a name is $30. (Mass. Gen. Laws ch. 156D, § 4.02 (2024).)

2. Appoint a Registered Agent

Every Massachusetts corporation must have an agent for service of process in the state (called a "registered agent"). A registered agent agrees to accept legal papers on your corporation's behalf if it's sued.

In Massachusetts, a registered agent can be either:

• a person whose business office is in Massachusetts (including on of your corporation's officers)
• a Massachusetts corporation, or
• an out-of-state corporation that's qualified to do business in Massachusetts.

(Mass. Gen. Laws ch. 156D, § 5.01 (2024).)

Before you appoint a registered agent, make sure they agree to accept service of process on your corporation's behalf. You'll name your registered agent in your corporation's articles of organization.

3. File Articles of Incorporation

You can legally create your corporation by filing Articles of Organization (called "articles of incorporation" in other states) with the SOS. You can file these articles online or by mail.

You must provide the following information in your articles:

• the name of the corporation
• the number of shares the corporation is authorized to issue and any required description of additional classes or series of shares
• the name and address of each incorporator
• the name and street address of the corporation's initial registered agent
• the names and addresses of the initial corporate officers
• the corporation's fiscal year, and
• any other information the SOS requires such as the corporation's federal tax identification number or a description of the corporation's business activities.

(Mass. Gen. Laws ch. 156D, § 2.02 (2024).)

The filing fee is based on the number of shares your corporation is authorized to issue. As of 2024, the filing fee for Massachusetts articles of organization is $275 for the first 275,000 shares and $100 for each additional 100,000 shares.

4. Prepare Corporate Bylaws

You should prepare initial bylaws for your corporation. Your corporate bylaws are an internal foundational document that sets out the company's structure and operating rules. You don't need to file this document with the state.

Typically, your bylaws will lay out:

• the officer positions for the corporation (for instance, chief executive officer, chief operating officer, secretary, etc.)
• the rights and obligations of directors, officers, and shareholders
• the procedure for meetings of directors and shareholders
• the process for electing and appointing directors and officers, and
• how stock is classified and issued.

The incorporators or board of directors will adopt the initial bylaws for your corporation at the first organizational meeting. (Mass. Gen. Laws ch. 156D, § 2.05 (2024).)

Besides providing a roadmap for your corporation's operations, your bylaws are critical for other reasons:

• They help establish your business as a separate entity from its officers, directors, and shareholders—preventing others from piercing the corporate veil and holding individuals in the corporation liable for corporate debts.
• They help show banks, creditors, the Internal Revenue Service (IRS), and others that your corporation is legitimate.

Store your bylaws, meeting minutes, and other important corporate papers in a corporate records book at your corporation's principal office. You can use a three-ring binder or order a special corporate records kit through a corporate kit supplier.

5. Appoint Initial Directors and Hold the First Board Meeting

After incorporation, you'll need to call the company's first organizational meeting. If the articles of organization have named the initial directors, then the named directors will hold the first meeting. If no directors have been named yet, the incorporators will hold the organizational meeting.

At the meeting, the incorporators or directors will:

• adopt the initial bylaws for the corporation
• elect the corporate officers, including the president, treasurer, and secretary, and
• take action on any other matters presented at the meeting.

If the incorporators hold the meeting, they must also elect the initial directors. The incorporators also have the option of foregoing a meeting and instead taking action by written consent of the incorporators. (Mass. Gen. Laws ch. 156D, § 2.05 (2024).)

You should also consider deciding on other important initial matters at the first meeting, including:

• selecting a corporate bank
• authorizing the issuance of shares of stock, and
• adopting an official stock certificate form and corporate seal.

If you want your corporation to be taxed as an S corporation, the directors should approve the election of S corporation status at the first meeting as well. You should record all actions and decisions in corporate minutes.

The incorporator should also fill out and sign an "Incorporator's Statement" showing the names and addresses of the initial directors. Put the Incorporator's Statement in the corporate records book along with the meeting minutes.

6. Issue Corporate Stock

After you've registered your corporation, created your corporate bylaws, and elected the board of directors, you should issue stock for your corporation in return for capital contributions. Once a person or business has been issued stock, they become a shareholder (also called a "stockholder"). Shareholders can contribute cash, property, services, or all three in exchange for stock.

Shareholders' Agreement and Stock Certificate

In general, when a corporation issues shares, the corporation and shareholders will agree to a shareholders' agreement (also called a "stockholders' agreement). This agreement lays out the corporation's and shareholders' respective rights and obligations.

Small corporations typically issue paper stock certificates to shareholders to represent stock ownership. One of the corporation's officers or directors should sign the certificate or the certificate should bear the corporate seal. You should also include the share's par value on the certificate if there is one. A share's "par value" is the minimum amount the share can be sold for.

List each shareholder's name and contact information in the corporation's stock transfer ledger.

Securities Laws and Exemptions

Typically, shares are classified as securities under federal and state securities laws. Securities laws require companies to follow certain rules when offering and issuing stock, such as registering the sale with the U.S. Securities and Exchange Commission (SEC).

However, fortunately, many small corporations don't have to worry about securities laws. Small corporations often make private offerings for their shares, and federal law exempts private offerings from being classified as securities. A "private offering" is a non-advertised sale to a limited number of people (generally 35 or fewer). See our corporations FAQ for more.

In addition to reviewing federal securities laws, you should check out Massachusetts's Uniform Securities Act. This Act covers the registration requirements and procedures for securities as well as exemptions.

If you have specific questions, speak with a Massachusetts business attorney. You should talk with a lawyer who has experience with the state's securities laws.

7. File an Annual Report

All corporations registered or qualified to do business in Massachusetts must file an annual report with the SOS. The annual report is due within two and a half months after the close of a corporation's fiscal year. For example, if your corporation's fiscal year corresponds with the calendar year, then your report would be due March 15.

You must report the following information in your annual report:

• the corporation's name
• the name and address of the corporation's registered agent
• the corporation's principal office address
• the names and addresses of the corporate officers and directors
• a description of the corporation's activities in Massachusetts
• the number of authorized shares (and the corresponding series or class, if applicable)
• the number of issued and outstanding shares (and the corresponding series or class, if applicable), and
• the corporation's fiscal year.

(Mass. Gen. Laws ch. 156D, § 16.22 (2024).)

As of 2024, the fee to file your Massachusetts annual report is $125 by mail and $100 online. To file your annual report online, you'll need your Customer ID Number (CID) and PIN. (You should've received this information when you originally filed your articles online.)

8. Obtain an EIN and Comply With Tax Requirements

Your corporation must have a federal employer identification number (EIN). You can get an EIN by completing an online application on the IRS website. There's no filing fee.

All corporations doing business in Massachusetts must pay state taxes to the Massachusetts Department of Revenue (DOR). Register your corporation with the DOR and file and pay most business taxes with MassTaxConnect.

Massachusetts corporate excise tax: Corporations must pay an excise tax to the DOR. The tax is based on a corporation's income and its property or net worth. The excise tax includes a minimum tax. You must submit your corporate excise tax return by the 15th day of the fourth month (3rd month for S corporations) after the end of the corporation's taxable year. This date is April 15 (or March 15) for corporations whose tax year lines up with the calendar year. Your corporation might need to pay quarterly estimated payments. Visit the corporate excise tax section of the DOR website for more information and guidance.

Massachusetts sales and use tax: If your corporation sells taxable goods and services to customers in Massachusetts, you must collect and pay sales tax to the DOR. You'll need to first register your corporation with the DOR to receive your sales and use tax registration certificate. You'll file a return and make your tax payment every month, quarter, or year depending on how much sales tax you collect. Use Form ST-9 for goods and STS for services online with your MassTaxConnect account or by mail. For more instructions, see the sales and use tax section of the DOR website.

Withholding employee wages in Massachusetts: If your corporation has employees, you must register with the DOR to collect withholding taxes. You can use MassTaxConnect to register your business. Depending on how much annual income tax is withheld by your corporation, you'll file and pay withholding taxes annually, quarterly, or monthly. Use Form M-941 or MassTaxConnect to file and pay this tax. Massachusetts provides detailed instructions on the withholding taxes on wages webpage of its website.

Massachusetts's unemployment insurance (UI) tax: Massachusetts corporations with employees must register with the Department of Unemployment Assistance (DUA). Your business will submit an employment and wage detail report and pay contributions to the DUA every quarter. For more guidance, see the Massachusetts guide to employer contributions to DUA.

For more on starting a corporation, including sample forms and bylaws, you can read Incorporate Your Business, by Anthony Mancuso (Nolo).