If you're a solo business owner who wants to form a limited liability company (LLC), you can start a single-member limited liability company (SMLLC) in Massachusetts. In general, the process for forming an LLC and SMLLC in Massachusetts is the same. You must follow Massachusetts's Limited Liability Company Act.
While situations might differ, in general, you can follow the steps below to form your Massachusetts SMLLC.
Massachusetts, like other states, has business naming requirements. A Massachusetts LLC must contain the words:
Your name also can't be deceptively similar to any business name on record or reserved with Massachusetts' Corporations Division. (Mass. Gen. Laws ch. 156C, § 3 (2023).)
You should make sure your proposed business is available. You can search the following Corporations Division databases for business names:
You can also reserve your business name for 60 days by filing an application of reservation of name with the Corporations Division. As of 2023, the filing fee is $30.
You can create a Massachusetts SMLLC by filing a certificate of organization with the Corporations Division. You can mail a completed certificate to the Division or file it online. As of 2023, the filing fee is $500 by mail and $500 for online filing.
You must provide the following information in your certificate of organization:
In addition, if your SMLLC has a specific date of dissolution, you'll need to provide that in your articles. If your SMLLC has any managers (including yourself), you need to provide the name and address of each manager. (Mass. Gen. Laws ch. 156C, § 12 (2023).)
Every Massachusetts SMLLC must have a resident agent. The resident agent is an individual or business entity that agrees to accept legal papers on behalf of the SMLLC. The resident agent can be either a Massachusetts resident or a corporation authorized to do business in Massachusetts. The resident agent must have a physical street address in Massachusetts.
You can use our online LLC formation application to file the paperwork and form your Massachusetts SMLLC.
You can complete all of the paperwork and procedural steps required to start a Massachusetts SMLLC by using our online LLC formation application.
In Massachusetts, you're not required to create an operating agreement for your SMLLC. However, having one in place between you (as the single member) and your LLC can provide many benefits. Having an agreement in place can help with liability protection by separating your business from you personally. It also can be useful with lenders and other businesses when entering into business transactions.
An operating agreement typically covers the member's rights, duties, and obligations, as well as the SMLLC's management structure. Your SMLLC can either be member-managed or manager-managed. In a member-managed SMLLC, you, as the sole member, manage the LLC. In a manager-managed SMLLC, you or someone outside the LLC (a nonmember) can act as the manager. If you're the manager or a manager-managed SMLLC, then you'll have two distinct roles: member and manager.
For more information and help to create an SMLLC operating agreement, see Nolo's Guide to Single-Member LLCs, by David M. Steingold (Nolo).
An SMLLC's default tax status is that of a disregarded entity (same as a sole proprietorship). A disregarded entity without employees isn't required to have a federal employer tax identification number (EIN). Instead, an owner of a typical SMLLC can report their business profits and losses on their personal tax returns using their own Social Security number or tax identification number.
However, you can elect to have your SMLLC taxed as a corporation. In that case, you'll need to apply for an EIN with the IRS. Regardless of how your SMLLC is taxed, if you have employees, you'll need to obtain an EIN.
In many cases, it makes sense to obtain an EIN for your SMLLC even if it's not required for federal tax purposes. Banks often require an EIN to open an account in the business's name and other companies you do business with could require an EIN to process payments.
Complete the IRS's online application on its website to get your EIN. There's no filing fee.
In some cases—for example, if you have employees or will be selling goods and collecting sales tax—you'll need to register with the Massachusetts Department of Revenue (DOR). You can register your business online and file and pay your business taxes with MassTaxConnect.
For more on tax registration requirements, see our article on LLC annual report and tax filing requirements in Massachusetts.
Your SMLLC might need to have certain local or state business licenses, permits, and registrations depending on your operations and location. You should check to see whether you need licenses, permits, or registrations related to:
Learn which licenses, permits, and registrations your business might need in our article on how to get a small business license in Massachusetts.
The Commonwealth of Massachusetts requires all domestic and foreign SMLLCs to file an annual report. You can mail in a completed annual report form or file the report online using the Corporations Division's online filing system. You'll need a customer ID number and PIN to access the online form.
Only a few pieces of information, such as the SMLLC's official name, the location of its principal office, and the name and street address of the resident agent, are required to complete the report.
The annual report must be filed each year on or before the anniversary date of the filing of the original certificate of organization. As of 2023, the annual report filing fee for a Massachusetts SMLLC is $500.
Starting an SMLLC in Massachusetts is fairly straightforward. After you choose a unique name with the proper LLC designator, you need to file a certificate of organization. The next steps are creating your governing documents and registering for taxes. Most business owners can complete the process on their own. But if you have particularly complicated taxes or are in a highly regulated industry, consider speaking with a business attorney. They can help you navigate the process of forming your SMLLC, including helping you register for taxes, drafting your operating agreement, and applying for any licenses or permits.
You can also find more information on forming and running your SMLLC on the single-member LLC section of our website.