How to create an S-Corp. in Massachusetts

Setting up a S-Corp. is complicated business. We advise to seek competent legal counsel.

But, here’s the general list of items that need to be done.

  1. Choose a name for the corporation
    Must include in its name either: Incorporation, Incorporated, Company, or Limited (or an abbreviation) at the end of the name
    Must be different from other business names on file with the Secretary of Commonwealth Corporations Division
    Business name may be reserved for 60 days with the Corporations Division (filing fee of $30)
  2. Appoint a Registered Agent
    Must be a Massachusetts resident or a business entity authorized to conduct business in Massachusetts with a physical business address in Massachusetts
    Agent agrees to accept service of process on behalf of corporation
  3. File Articles of Organization
    Must be filed with the Secretary of the Commonwealth Corporations Division
    Must include: (1) corporation name & address; (2) business purpose; (3) name and address of registered agent; (4) authorized shares and their par value; (5) preferences, limitations, and rights of any class or series of shares; (6) restrictions on transfer of shares, if any; (7) effective date of organization; (8) names and addresses of initial directors, president, treasurer, and secretary; (9) fiscal year end; (10) description of business
  4. Articles of Organization Signed by Incorporator(s) or Authorized Agent
    Must be signed by at least one incorporator
    Must include the capacity in which he/she signs and the date
  5. Submit Appropriate Filing Fees for Articles of Organization
    The filing fee is $275 for up to 275,000 shares plus $100 for each additional 100,000 shares or any fraction thereof
  6. Secure an Employer Identification Number
    Must be filed through the Internal Revenue Service
    May be done online, by fax, by mail, or by phone
  7. File IRS Form 2553, Election by a Small Business Corporation
    Articles of Organization register the corporation as a C-corp but the election via Form 2553 allows the C-corp to become an S- corp
    Must be filed with the Internal Revenue Service after corporation is formed with Massachusetts
    Should be approved by directors
    Must be filed within 2 months and 15 days after the beginning of the tax year the election is to take effect OR at any time during the tax year preceding the tax year it is to take effect
    Corporation may only have up to 100 shareholders
    Must have only one class of stock
    No fee
  8. Create a corporate records book
    Suggested, not required
    Used to store all important corporate documents such as Articles of Organization, bylaws, meeting minutes, stock certificates, ledger, stock certificate stubs, stock transfer documents, etc.
  9. Appoint Initial Corporate Directors
    Incorporator must appoint directors to serve until the first annual meeting of the shareholders when directors are elected by shareholders
    Incorporator must create an “Incorporator Statement” listing the name and addresses of the initial directors, incorporator must sign the statement and place a copy in the corporate records book
    Incorporator Statement does NOT need to be filed with the state
  10. Hold First Board of Directors Meeting
    Directors can appoint corporate officers, create bylaws, choose a bank for the corporation’s account, issue stock, adopt official stock certificate form and seal, set the corporation’s fiscal year, etc.
    Record minutes of meeting, directors sign minutes, and record added to corporate records book

Forms that may need to be completed:

[gview file=”https://marvincable.com/wp-content/uploads/IRS2553.pdf”]

[gview file=”https://marvincable.com/wp-content/uploads/EIN-applicationpdf.pdf”]

[gview file=”https://marvincable.com/wp-content/uploads/corp-articles_of_orgt.pdf”]