This content doesn’t contain and isn’t meant to provide legal, tax, or business advice.*
Massachusetts offers unique advantages for starting your business. As a major hub for international trade and the US tech industry, the state gives you access to one of the country’s most educated workforces. With more than 100 universities and colleges—including world-renowned institutions like Harvard, MIT, and Tufts—you can grow your business alongside some of the brightest minds in the nation.
While starting a business in Massachusetts can be complex, this guide will walk you through each essential step.
Why start a business in Massachusetts
“Massachusetts is a strong state for any small business to establish itself, including women-owned businesses,” says Pamela Prince-Eason, president and CEO of the Women’s Business Enterprise National Council (WBENC).
The state ranks in the top 10 for supporting women-owned businesses, according to The 2024 Wells Fargo Impact of Women-Owned Businesses report. Business owners can access mentorship programs, training resources, business tax credits, and networking opportunities to help their companies grow.
How to start your Massachusetts business
Ready to turn your business idea into reality? Here’s what you need to know to launch your company in the Bay State.
Choose a business idea
Starting your business begins with a solid business idea. You might create something new to fill a market gap or improve an existing product or service. Focus on two key areas as you develop your concept:
Your target customer
Think about whether you’ll serve consumers (B2C) or other businesses (B2B). Research your potential customers’ needs through market surveys and industry trend analysis. Decide if you’ll sell products online, through a brick-and-mortar storefront, or both.
Your path to profitability
Consider the key factors that affect your profits, like pricing, distribution methods, and overhead costs. Calculate how much you need to sell to break even and build healthy profit margins.

Free: The Big List of Business Ideas
To help you find the inspiration to start, we compiled a list of 100+ in-demand business ideas, broken down into categories like fitness, apparel, and gaming.
Create a business plan
Your business plan guides how you’ll run your company, generate revenue, and grow over time. This document is especially important if you plan to seek funding from investors.
To get a headstart on your business plan, use a template or review example business plans for inspiration.
Include these essential elements in your plan:
- Executive summary
- Company description and mission statement
- Product or service details
- Organization and management structure
- Financial projections and expense forecasts
- Customer analysis
- Market research and target market overview
- Marketing strategy
- Operations and logistics details
“No business plan is perfect, and it’s true that reality will foil even the best of plans,” says Gabrielle “Gaby” King Morse, president and CEO of the Center for Women & Enterprise (CWE), who advises entrepreneurs to stay flexible with their planning. “Use reality to build resilience into your business.”

Free: Business Plan Template
Business planning is often used to secure funding, but plenty of business owners find writing a plan valuable, even if they never work with an investor. That’s why we put together a free business plan template to help you get started.
Choose your business name
Your business name needs to be memorable, able to grow with your business, and meet Massachusetts naming requirements. Here’s what you need to know:
Check name availability
Since Massachusetts has more than 722,000 small businesses, finding an original name might take time. Search the state’s business entities database to make sure your preferred name isn’t already taken.
Follow naming rules
If you form an LLC or corporation, include required identifiers like:
- “Limited liability company” or “LLC”
- “Limited company” or “LC”
- “Corporation” or “Co.”
Your name can’t be confused with government entities (like “Massachusetts Police Department LLC”) or suggest you work in regulated industries like health care or law unless you do.
Consider a DBA
A “doing business as” name (called a business certificate in Massachusetts) lets you operate under a different name than your legal entity. You’ll need to get this from your city or town government—in Boston, business certificates cost $65, but fees vary by location.
Secure your online presence
Before finalizing your name:
- Check if your preferred domain name is available
- Register relevant domain names
- Claim matching social media handles
Choose your business structure
Your business structure affects everything from taxes to personal liability. Here are the most common options:
Sole proprietorship
A sole proprietorship is the simplest way to start, especially if you have low risk and no employees. There’s no legal separation between you and your business—you’ll pay taxes through your personal return at Massachusetts’s 5% individual rate on income of more than $8,000. You can always switch to an LLC or corporation later.
Limited liability company (LLC)
Limited liability companies, or LLCs, protect your personal assets if your business faces legal issues or debt. As a pass-through entity, business income flows to members and is taxed at the personal rate of 5%.
To form an LLC in Massachusetts, file an LLC Certificate of Organization with the state Secretary of the Commonwealth for $500.
Corporations
Corporations offer the strongest liability protection and let you sell shares to raise money. You’ll pay Massachusetts’s corporate excise tax (generally 8% of taxable net income). To avoid double taxation, you can file IRS Form 2553 to become an S corporation.
To incorporate, file Articles of Organization with the state Secretary of the Commonwealth. The fee is $275 for up to 275,000 shares, plus $100 per additional 100,000 shares.
Get your employer identification number
Most businesses need a federal employer identification number (EIN) to file permits, hire employees, open a business bank account, and pay taxes. Apply for your EIN free through the IRS website. If you’re a sole proprietor, you can use your Social Security number instead.
Get your business licenses and permits
While Massachusetts doesn’t require a general business license, you might need specific permits depending on your industry. Retail, transportation, health care and real estate businesses typically need licenses. Check the Massachusetts database to find out which permits your business needs.
Set up business insurance
Massachusetts requires LLCs and corporations to have:
- Workers’ compensation insurance for employee injuries
- Commercial auto insurance for business vehicles
If you have employees, federal law requires unemployment insurance. Register through the Department of Unemployment Assistance (DUA).
Additional coverage to consider
Protect your business with these common business insurance policies:
- Professional liability insurance: Covers your business if a customer experiences harm due to professional errors.
- General liability insurance: Often called “slip-and-fall insurance,” this protects you if someone gets injured at your business.
- Commercial property insurance: Protects your business location from natural disasters like floods or hurricanes.
Fund your business
Starting a business without money is no easy task. Your business plan will help you figure out how much money you need to start. Here are common funding options:
- Self-funding: Save your own money to launch your business through bootstrapping.
- Friends and family: Consider loans or investments from your network, but create a clear repayment plan to protect relationships.
- Professional investors: Massachusetts has manyangel investors (individuals) and venture capital firms (professional groups) who might fund your business.
- Business loans: Look into microloans, commercial bank loans, and Small Business Administration (SBA) loans.
Register with the Secretary of State
Unless you’re a sole proprietor or general partnership, you’ll need to register your business with the Massachusetts Secretary of the Commonwealth. Submit your paperwork through the Filing by Subject page based on your business structure. You can file online, by fax, mail, or in person.
You might also need to:
- Get a business certificate (DBA) from your city or town
- Secure your EIN
- Create a MassTaxConnect account for state taxes Report beneficial ownership information (BOI) to FinCEN if required
Set up your business bank account
Keep your personal and business finances separate by opening a dedicated business bank account. Here’s how:
Find the right bank
Compare banks and credit unions based on their offerings. Look at account fees, transaction limits, and online banking features. Consider what additional services you might need, like merchant accounts or business credit options.
Prepare your documents
Before applying, gather your business registration, EIN, operating agreement (if applicable) and personal identification. Your bank may require additional documents based on your business structure—they’ll let you know what else you need.
Open your account
Apply online or visit a local branch. You’ll need to provide your business’s legal name, structure, and ownership details. Many banks require an initial deposit to activate your account. Pay attention to minimum balance requirements to avoid unnecessary fees.
Set up banking tools
Get your online banking set up to easily track transactions and transfer funds. Order business checks and debit cards for your new account. Choose accounting software or create a bookkeeping system to track all your transactions—essential for tax reporting and financial planning.
Read more
- Massachusetts LLC: How To Start an LLC in Massachusetts in 12 Steps
- Open-Source Ecommerce: 6 Open-Source Platforms for Ecommerce Stores
- What Is Organizational Structure? Definition and Guide
- What Is a Mission Statement? Definition and Guide
- How To Start a Business in Idaho in 8 Easy Steps
- Mississippi LLC: How To Start an LLC in Mississippi in 11 Steps
- 6 Top B2B Ecommerce Websites Tailored to Small Businesses
- How To Start a Business in Louisiana in 8 Easy Steps
- SaaS Ecommerce: 5 Platforms to Power Your Ecommerce Site
- Create a business name in seconds using our FREE Business Name Generator
Start a Massachusetts business FAQ
What is the most common reason for a small business to fail?
Most businesses fail due to funding problems and lack of industry experience. While bad luck can play a role, proper financial planning and market knowledge significantly improve your chances of success.
What is the easiest business to start?
The easiest business to start in Massachusetts depends on your skills and interests. Starting an online business often requires less initial investment and overhead, making it a popular choice for new entrepreneurs. Focus on a business idea that matches your expertise and passion.
Do you need a license to start a business in Massachusetts?
Massachusetts doesn’t require a general business license. However, specific industries like health care, building trades, and commercial transportation need special licenses and permits.