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LLC Cost In Massachusetts - How Much To Pay In Fees & Taxes in MA

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Last updated February 17, 2023

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When preparing to legalize your business in the state of Massachusetts, the first thing you want to know is how to start an LLC in Massachusetts. Once you are into this, you wonder what your Massachusetts LLC price will be.

To save you the trouble of searching high and low, we’ve made a detailed breakdown of Massachusetts LLC costs so that you understand your upcoming expenses to efficiently plan your budget.

How Much Is an LLC in Massachusetts?

Limited liability companies are state-specific entities and so are LLC costs. The cost of forming an LLC in Massachusetts is a fixed state fee. However, there are a number of associated charges and regulatory payments you should encounter too.

By and large, LLC-related expenses could be divided into:

Obligatory payments pertinent to the entity registration and operation;
Optional ones that might arise in relation to certain services.

Common LLC Fees in Massachusetts

Your final price tag might vary depending on the company type and locality within the jurisdiction you are going to operate your business.

Most common payments you’ll have to make during and after LLC formation include both one-time charges and fees to be paid on a regular basis.

Massachusetts Online Filing Fee: $500

Limited liability companies are registered by state authorities. In Massachusetts, it’s the Secretary of Commonwealth. Formally, LLC registration is about filing the Certificate of Organization with the state office.

In Massachusetts, you can file either online or by mail. The filing fee will stay the same. It’s $500, which is at the higher end of the price range as compared to $100, $80, or $120 in many other states.

However, Massachusetts filings are fast. You’ll get your company registration approved in about 4 hours when submitting an online form and within 4 to 5 workdays when mailing the documents.

Registered Agent in Massachusetts: $0 - $150

A registered agent is a law requirement for LLCs across the US, and the state of Massachusetts is not an exception. You won’t be able to finalize LLC registration and eligibly run your business unless you appoint a registered agent.

In Massachusetts, you can choose to serve your own agent which will be free of charge since you don’t have to pay yourself. Or you can designate some of your family members or friends who will agree to handle that function for some symbolic fee or even also for free.

The best option, though, is to hire one of the professional agent services for that purpose. Not only will a dedicated service do the job for you but also it will ensure that:

Your legal mail is duly handled and organized;
You are informed about any important letters and notifications in time;
Your LLC’s compliance is diligently maintained;
You will pay a reasonable price for the service, with average rates usually falling anywhere around $49 - $150 per year;
You get access to nice volume discounts (10% - 25%) when ordering the service for multiple states or purchasing a multi-year subscription.

Annual LLC Fee Massachusetts: Annual Report: $500

Massachusetts has no privilege or franchise tax for limited liability companies, yet, the state requires entities to file an annual report to keep their registered info updated. This Massachusetts LLC annual fee is one of the compliance requirements that should be observed.

Failing to submit a state report in time might result not only in penalties and fines but also in administrative dissolution, which is certainly not what you want for your company.

A Massachusetts filing fee for LLC is $500. A report is to be provided to the Secretary of the Commonwealth on an annual basis before your LLC’s anniversary date.

Foreign LLC Cost in Massachusetts: $500

To run a Massachusetts business under the LLC structure registered in any other US state, you need to get a so-called foreign qualification in Massachusetts. This will allow you to legalize an existing entity in the state.

Normally, foreign LLC filings are more expensive than domestic ones, yet, Massachusetts has a $500 rate for foreign limited liability companies too. You should submit an application to the Secretary of the Commonwealth either online or by mail.

Professional LLC Price in Massachusetts: $500 + License Fees

To be able to provide certain professional services under the LLC legal umbrella, you should establish a professional limited liability company in Massachusetts.

The formation process is pretty much the same as for a common LLC and so is the filing rate of $500. However, to register as a PLLC, you should also have an appropriate professional license in place.

Professions that require licensing include:

Lawyers and attorneys;
Engineers;
Doctors, physicians, and veterinarians;
Public accountants;
Psychologists;
Physical therapists and chiropractors;
Dentists;
Nurses;
Builders and electricians.

The license price might vary by county or municipality and fall anywhere from $20 up to $500. So, the final PLLC cost will differ by locality.

LLC Fee in Massachusetts: Business License Cost: Price Varies Locally

Massachusetts LLCs should have business licenses to legally operate in the state. However, business licensing rules function a bit differently in this jurisdiction.

In Massachusetts, business licenses are issued at a local level, i.e. by a county or city. That’s why there is no fixed licensing fee. For most entities, the application cost is about $20 to $50. However, for LLCs, that rate is the highest and might be around $500.

Notably, a business license in Massachusetts is issued for a period of 4 years and doesn’t have to be renewed annually. Any other licenses, though, might need renewal more often. To learn about the licensing requirements for your LLC, contact your local government office.

Massachusetts LLC Taxes

As a disregarded entity, your Massachusetts LLC won’t have to pay an income tax as a legal person. It will only be exposed to a corporate income tax if you elect a C-Corp tax status for your company with the IRS.

Other taxes to consider are:

A 5% state income tax for each LLC member levied over their share in the LLC profit after distribution;
A federal self-employment tax at a rate of 15.3% to be paid by the members of LLCs using pass-through taxation;
State sales and use tax of 6.25% levied over tangible goods and services;
Payroll taxes for employers payable under varying rates that depend on the employees’ salaries and types of activity.

Other Massachusetts LLC Costs

Along with regular and compulsory payments, there are a number of payments that might occur depending on your business situation and needs. Most often than not, these are one-time payments charged at fixed rates.

Name Reservation Cost in Massachusetts: $30

You can reserve the desired LLC name if it turns available in the state for a period of 60 days. Thus, you’ll get more time to get prepared for filing and will rest assured your name won’t be snitched.

A reservation fee in Massachusetts is $30. You should file a name reservation form with the Secretary of the Commonwealth. For another $30, you can prolong the reservation period for additional 60 days.

DBA Registration in Massachusetts: Location-Specific Price

Similar to other states, Massachusetts allows running an LLC under a fictitious or DBA (doing business as) name, which is different from your company's registered name.

However, unlike in most other jurisdictions that have a single registration rate for all localities, DBA registration fees in Massachusetts will vary by the city where you will operate your venture.

Massachusetts Certificate of Good Standing: $25

A bank or any other financial institution will require a Certificate of Good Standing if you:

Apply for a business loan;
Need to get an operational credit;
Establish a factoring program

Issued by the Secretary of the Commonwealth, this document verifies your LLC’s compliance status and legitimacy. The issue costs $25.

Certified Document Copies in Massachusetts: $7

You can get certified copies of your LLC documents from the Secretary of the Commonwealth if necessary. Those might be required by your vendors, suppliers, creditors, or even customers.

Such copies are payable. The fee is $7 per copy plus $2 per document page.

Massachusetts LLC Certificate of Amendment: $100

If you need to make any changes in your registered company info, you can legalize those changes only by filing amendments to your Certificate of Organization.

You should file a Certificate of Amendment with the Secretary of the Commonwealth and pay a $100 state fee. The changes will be normally enforced within 3 to 5 business days.

Massachusetts LLC Application for Reinstatement: $100

If you fail to catch up with the state compliance requirements, your LLC might be exposed to administrative dissolution.

Should that happen for some reason and you want to reinstate your entity, you can submit an Application for Reinstatement with the state department and pay a $100 fee.

Massachusetts LLC Certificate of Cancellation: $100

To formally close your LLC, it’s not enough to simply stop running a business. You need to get it legally dissolved by filing a Certificate of Cancellation with the Secretary of the Commonwealth.
The procedure is fairly straightforward and it will cost you $100.

FAQ

Is Massachusetts LLC registration worth its money?

A Massachusetts incorporation fee turns out to be lower than that of an LLC. However, despite higher registration rates, an LLC structure has a lot going for it. Its ultimate flexibility and assets protections it offers make it a perfect choice for smaller and growing businesses.

At the same time, the money you invest in the entity formation will pay off eventually with lower charges and flexible tax options.

How long does it take to set up an LLC in Massachusetts?

A high LLC filing fee in Massachusetts is justified by really fast document processing. Online filings are approved within just 4 hours and mailed applications are reviewed in about 4 business days, which is also fast.

Do I need to get a business license for a Massachusetts LLC?

There are no rules for a general business license. A state business license is required, yet, it’s issued locally by municipal and county authorities. Hence, the pricing will vary.

Is there an income tax for a Massachusetts LLC?

Limited liability companies choosing default pass-through taxation are exempt from paying income taxes at a state level. Company profits will be taxed under company owners’ personal tax rates. Yet, if you elect a C-Corp tax status for your limited liability company in Massachusetts, get ready to pay a corporate income tax.

Does a Massachusetts LLC call for an annual renewal?

You need to file an annual report with the state to keep your Massachusetts company legitimate and in good standing. The report is to be submitted before your LLC’s formation date each year.

What is the cheapest way to start an LLC in Massachusetts?

If you want a cheap Massachusetts LLC, you should form it on your own, without engaging an attorney or any special LLC service. Hiring an assistant will add to your final costs.

Handling the formation routines by yourself, you will only have the state fees to cover. Given the high filing fees in Massachusetts, it’s a reasonable option.

Can a Massachsuetts LLC get tax refunds?

Limited liability companies using pass-through taxation of disregarded entities cannot get tax refunds. Yet, a C-Corp tax status elected by filing Form 8832 with the IRS will make your company open to tax repayments.

Can I pay myself a salary from my Massachusetts LLC?

Limited liability companies using pass-through taxation of disregarded entities cannot get tax As an LLC member, you’ll be considered self-employed and pay yourself via profit draws. Yet, if you choose a C-Corp tax status for your company, you’ll be entitled to get hired as an employee and pay yourself a salary.

Can I pay myself a salary from my Massachusetts LLC?

Can I pay for my cell phone from my Massachusetts LLC?

Yes, you can but to the extent that you use your cell phone for business purposes. To be entitled to deductible costs, business expenses should be no less than 50% of total costs.

Can I write off my Internet expenses from my Massachusetts LLC when working from home?

Internet cost deductions are allowed only if you use the Internet for business most of the time. Otherwise, you’ll have to settle those expenses yourself.

Can I deduct my car expenses from my Massachusetts LLC?

You can write off only the costs related to business use. Even an entire vehicle cost deduction is allowed if you use your car solely for business tasks.

Can I write off fuel receipts from my Massachusetts LLC?

To deduct driving costs, you should keep records of miles you drive for business, which is a real hassle. However, you can write off fuel receipts as a part of general vehicle costs, which is a simpler and more convenient option.