Launching a professional practice is a serious step to take. Similar to other beginner businessmen, you’ll find yourself wondering which type of entity will best suit your business needs.
An LLC structure ensures liability protection, flexible taxation, and easy enterprise control while providing independence for the business. In Massachusetts, certified specialists could go further and create a professional LLC. Check our guide to start on the right foot.
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If you have some sort of certification or registration enabling you to deliver specialized services, you can open a PLLC in Massachusetts. Professions entitled to PLLC formation include but are not limited to:
Before you dig into your Massachusetts PLLC registration, though, make sure all prospective PLLC members have required professional permits in place. Otherwise, your future company will be open to eligibility risks.
Once you are ready, it won’t take you long to form a legal entity. Just follow our simple instructions below.
First and foremost, when naming a PLLC, there are certain legalities to observe. Both a professional regulatory board and state law can set naming restrictions. You can find a full code of naming rules in the Massachusetts State Statute.
Meanwhile, a few key rules to remember when inventing a moniker for your future company are as follows:
To ensure the chosen business name is available in the state and can be further entered into your formation docs, do a business name search in Massachusetts. This will help prevent rejected filing due to selecting the wrong company name.
Besides, it’s advisable that you choose a descriptive name that will refer to your professional activity. Since you already have professional certifications, you can use professional terms in your business moniker.
Typically known as a registered agent across the nation, a resident agent (RA) in Massachusetts is an individual or legal entity that will handle official mail on behalf of your PLLC including:
State residency and a registered address in Massachusetts are two core rules for RAs in this state. An agent should be present under the registered address from 9 am to 5 pm on weekdays to personally handle your correspondence.
There are no other limitations, though. With that, you can:
Two latter options come at a cost, yet, will certainly save you peace of mind and contribute to your business compliance by monitoring your crucial correspondence. With an RA service on your side, you can also expect to match your RA needs in other states.
When you check the chosen business name and decide on an RA, you are ready to file a PLLC in Massachusetts. At this stage, you should submit your Certificate of Organization to the state office and get it approved by the Secretary of State.
You can file using one of the following methods:
William Francis Galvin
Secretary of the Commonwealth
One Ashburton Place, Room 1717
Boston, MA 02108
or fax it to
(617) 624-3891 along with a cover sheet.
By form and content, the Certificate of Organization is a generic document embracing standard company info including the following:
Massachusetts doesn’t call for LLCs to have an Operating Agreement. Yet, this document is too important to be neglected, especially when you form a company providing professional services.
Though an internal instrument, this agreement stipulates the rules of how the company is to be managed and controlled. Its major function is to:
An Operating Agreement is compiled by the PLLC co-owners and reflects their covenants regarding:
Once formed, your PLLC becomes an independent entity legally separate from you. And it will be treated as such by all statutory and regulatory authorities. To identify your entity as such, those authorities use codes similar to Social Security Numbers for Individuals.
An EIN is a Federal Tax Identification Number or an Employer Identification Number that makes business entities visible in legal and regulatory fields as well as visible as a taxpayer. It’s issued by the IRS for free and getting it is as simple as filing an online application.
At the same time, you will need an EIN to:
The state has the highest filing fee in the US. You’ll have to pay $500 for the PLLC formation in Massachusetts. It’s a compulsory state fee and you can’t skip it.
Above that, though, there are a few other expenses you might find on your payment list
|An expedited filing fee for quick online processing||$20|
|A name reservation fee if you seek to put your name on hold before filing||$30|
|DBA registration fee if you want another name for your company different from its registered name||$65|
|Annual RA service subscription||between $50 and $300|
To keep your company afloat after you start a PLLC in Massachusetts, there are a few important steps you need to take immediately after state filing.
It’s vital to separate personal and business funds, assets, and expenses from the very beginning to retain the corporate veil integrity and enjoy the liability protection to the full.
Set up a dedicated bank account for your business and maintain an accurate and comprehensive accounting system. This way, you’ll control business cash flows in the best manner possible and avoid any liability issues.
Apart from the professional certifications you need to have in place when setting up a PLLC in Massachusetts, there are other permissive documents you might need for your business.
Thus, LLCs are licensed at the federal, state, and local levels. You can check a US Small Business Administration Guide and the Professional Licenses and Permits section on the state website for federal and state licenses appropriate to your business.
Besides, contact municipal authorities and your local clerk’s office to find out a complete list of local certifications you need to get.
Operating a professional service company, you need to secure your business against certain risks. This is where business insurance comes in to help minimize some types of risks and damage.
It will be a reasonable move to get general liability insurance to shield your own interests. Meanwhile, worker’s compensation insurance is required for employer businesses.
Besides, Massachusetts is one of the few states that require PLLCs to maintain professional liability insurance for each professional member, with a minimum coverage of $250.000.
When formed, legal entities have to match certain legalities to stay legitimate and operable. In Massachusetts, PLLCs have the following compliance commitments: