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Incorporate in Massachusetts

Date: 09/10/2018 | Category: | Author: Jakub Vele

Incorporate in Massachusetts

The Commonwealth of Massachusetts has played an all important commercial as well as cultural role in shaping the history of the United States and is home to the oldest institution of higher learning, which is Harvard University in Cambridge. The old economy of the state was dependent primarily on agriculture, fishing and trade but the modern economy shifted first to manufacturing and then to services. As more and more people set up companies in Massachusetts, it became a global leader in engineering, biotechnology, finance, higher education, and maritime trade.

Why Choose Massachusetts for Incorporation?

Whether you are planning to form a corporation or a limited liability company in Massachusetts, it is a known fact that small businesses and entrepreneurs play a key role in boosting the economy of the state. Business incorporation in Massachusetts will provide you with the opportunity to benefit from various incentive programs.

A major benefit that small businesses can take advantage of is the Economic Development Tax Incentives Program. This program includes a variety of tax incentives for corporations and LLC’s. Some of them are:

  • Massachusetts Investment Tax Credit (ITC): If you set up a company in Massachusetts and qualify for this program then your business can benefit from a three-percent credit to offset your Massachusetts corporate excise tax.
  • Massachusetts Research & Development Tax Credit: This is a tax incentive offered to small and medium sized enterprises for investment in research and development.

How do you incorporate in Massachusetts?

What is the process of business incorporation in Massachusetts? What type of documentation is required? These are some of the common questions that you will be confronted with if you are planning to establish a new business in the state. The following steps will enable understanding of the entire process:

Business Type

What type of business do you want to set up in Massachusetts? If you want to set up a company in Massachusetts, you can choose to form Profit and Professional Corporations, Limited Partnerships (LP), Voluntary Associations, Limited Liability Partnerships (LLP), and Limited Liability Companies (LLC) among others. The type of business entity you want to form can be a domestic or foreign entity. The forms and fee will be different for each type of entity.

Business Entity Name

If you have already identified the type of business you want to set up then the next step towards incorporation in Massachusetts is to identify a name for your business entity. There are 3 steps towards business name formation and they are:

  • Naming Requirements: The naming requirements for LLCs should be pursuant to 2006 Massachusetts Code – Chapter 156C — Section 3, while that of a business corporation should be pursuant to 2006 Massachusetts Code – Chapter 156D — Section 4.02. The name of each limited liability company must contain words like “Limited Liability Company” or abbreviations like “L.L.C.” or “LLC”. A corporate name must contain words like “corporation”, or “incorporated” or abbreviations like “corp.” or “inc.”
  • Business name search: You need to search for a business name that is not in use currently. You can conduct a name search here.
  • Name Reservation: Once you have identified a business entity name, you can reserve the name with the office of the Secretary of the Commonwealth for a period of 60 days.
  • Name Registration: If you are a foreign entity planning to set up a company in Massachusetts and if your name is not available then you will be required to file or submit a DBA form.
    Application for DBA

Choose a Registered Agent

A domestic business entity as well as foreign entity authorized to transact business in the state of Massachusetts will have to maintain a registered agent pursuant to 2006 Massachusetts Code – Chapter 156D — Section 5.04 for corporations and 2006 Massachusetts Code – Chapter 156C — Section 5 for limited liability companies. We are one of the respected registered agents in Massachusetts and will be responsible for initiating incorporation in Massachusetts through processing of your “Articles of Organization” for domestic corporations and “Certificate of Registration” for foreign corporations.

Articles of Organization and Certificate of Registration

You will be required to submit “Articles of Organization” governed by M.G.L.A. c156D § 2.02; 950 CMR 113.16 if your business is a domestic corporation and a “Certificate of Registration” pursuant to M.G.L.A. c156D § 15.03 (2004); 950 CMR 113.48, if it is a foreign business entity. In order to streamline the process of incorporation in Massachusetts, we can file documents on your behalf through the online process or through an expedited process.

Date Stamped Copies

As a part of the process of company incorporation in Massachusetts, we will ensure, you receive date-stamped and filed copies that verifies the state has filed as well as formed your corporation.

Costs and Fees associated with Massachusetts Incorporation

What would it cost to set up company in Massachusetts? Check Fees here!

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Why Massachusetts?

Date: 07/06/2015 | Category: | Author: Jakub Vele

Why incorporate in Massachusetts?

Business Information & Rankings

  • Massachusetts ranked 3rd in the Top States for Biotech Growth Index. (Laboratories of Innovation: State Bioscience Initiatives 2004)
  • Massachusetts ranked 1st for both the number of high-technology companies per capita and the level of venture capital investment. (Development Report Card for the States: 2004, Corporation for Enterprise Development)
  • Massachusetts offers one of the nation’s largest R&D tax credits. (2004 Index of the Massachusetts Economy)
  • Massachusetts has produced half of all the Nobel Prize winners in the country.

Cost of Living Index

For Boston, MA (2005):Index Score
Misc. Goods & Services:123.2

Crime Rate

Massachusetts has the 13th lowest crime ranking in the U.S. (FBI, 2004)

Fees & Taxes

Business Inventory Tax
Business inventory is exempt.

Corporate Income Tax
Massachusetts’ corporate tax structure consists of a flat rate of 9.5% on all corporate income. This rate includes a 14% surtax, as does the following: an additional tax of $7.00 per $1,000 on taxable tangible property (or net worth allocable to state, for intangible property corporations); and a minimum tax of $456.

Personal Income Tax
Massachusetts’ personal income tax system consists of a flat tax of 5.3% on all personal income.

Personal Property Tax
Taxable. All real and tangible personal property located within the Commonwealth of Massachusetts is taxable unless specifically exempted by statute.
Massachusetts imposes a 5.3% tax on any gains from the sale or exchange of capital assets held for more than one year. There is an exception for collectibles. The state’s long-term gains rate on collectibles is 12%.
The state also collects a 12% tax on interest (except interest from Massachusetts banks), dividends, and gains from the sale or exchange of capital assets held for one year or less (short-term capital gains).
Massachusetts is one of the 38 states that collect property taxes at both the state and local levels.

State Sales and Use Tax
Base Rate: 5.0%
Machinery Rate: None

There is a exemption for sales of machinery or replacement parts thereof used directly in farming, fishing, the actual manufacturing of tangible personal property to be sold, utilities, or research and development by a manufacturing constitution or a research and development corporation.

Unemployment Insurance
Massachusetts’ new employers’ rate is 2.53% for 2 years.