Are you planning on expanding your business in Massachusetts? Do you want to gain more consumer trust? Then chances are, you’ll want to get a certificate of good standing.
This piece of paper is something most states offer, and it’s beneficial to have. It may be more work to apply for one, but requesting a certificate of good standing in Massachusetts will definitely pay off if you do business in this state.
What is this document and how can you get one? Read on to find out more.
What’s a Certificate of Good Standing?
The certificate of good standing is an official document you receive from the Massachusetts Secretary of the Commonwealth. It shows that your business (which can be a corporation or limited liability company, or LLC) is properly registered with the state. This gives you official proof that you’re compliant with all applicable laws and regulations.
As the name suggests, it certifies that you’re in good standing with the state. This means that you’ve filed all necessary annual reports and paid all required state fees and taxes. As a result, your company is legally authorized to operate in Massachusetts.
Now, you might be wondering, when would you need a certificate of good standing? It’s true that it’s not a required document for operating your business, but there are certain situations that warrant this certificate.
Business Licenses and Permits
In certain industries, you’ll need to renew licenses or permits to keep operating; for example, healthcare, construction, or liquor sales.
When you apply for these licenses, the authorities may require proof that your company is in good standing with the state. This requirement encourages businesses to remain compliant, as they won’t be able to keep their doors open otherwise.
Business Bank Account Opening
Banks won’t just give anyone an account, especially when dealing with large sums of money. So don’t be surprised if yours asks for a certificate of good standing when you try to open an account. This paper will show them that your business is legally registered and compliant.
Loan or Credit Applications
When going through the loan or financing application process, it’s common practice for banks, financial institutions, and even private investors to request a certificate of good standing.
This gives them reassurance that your business is compliant with state laws and financially stable. The document is hard evidence and reduces the perceived risk of lending money to a non-compliant or troubled entity.
Contracts
If you’re seeking government contracts (local, state, or federal), you’ll often be asked to provide a certificate of good standing. This proves that your company is legitimate and that you’ve fulfilled all legal and regulatory obligations.
Those dealing with private-sector contracts may still be required to produce this document. These potential business partners want to ensure they’re working with compliant and reputable companies.
Mergers, Acquisitions, and Business Sales
Like with contracts, you’re getting involved with third parties with mergers, acquisitions, and business sales. If you show a certificate of good standing, it’ll give stakeholders peace of mind since they’ll see that your company isn’t facing administrative dissolution or other legal issues.
Foreign Qualification
Foreign qualification is when you do business in other states other than Massachusetts. While you were able to create a company in this state, others will still want to see proof that your business is in good standing in its home state before you qualify as a foreign entity. Providing this paper will suffice in most cases.
Business Reinstatement
Has your company been administratively dissolved or suspended since you failed to meet regulatory requirements? Then if you want to reinstate it, you might have to submit a certificate of good standing. This proves that you’ve addressed the reasons for suspension and that you’re back in compliance with state laws.
How to Get a Certificate of Good Standing in Massachusetts
Considering that this document certifies that your business is compliant, you should first make sure that’s the case before applying for the certificate. This means that your annual filings should be up-to-date and all due taxes and fees are paid.
Do you still need to create a company? Then no problem; use our free business registration service that’s quick and easy. All you’ll have to take care of is the state fees, and it comes with a free year of our registered agent service too.
If you already have a business and you’re certain it’s in good standing, then take the following actions to get your certificate.
Request a Corporate Massachusetts Certificate of Good Standing Online
As we’ve said before, the Secretary of the Commonwealth of Massachusetts is responsible for issuing these documents, so you’ll use their website to get one. Do note that while you can make requests online, you can’t get electronic certificates for LLCs. Also, only a limited number of certificates are available through email, and they’re only for certain entities, such as domestic profit, foreign, and non-profit corporations.
On the form, you’ll have to fill out the:
- ID number
- Entity name
- Certificate type
- Contact name
- Business name (optional)
- Mailing address
- Email address
After reviewing your request, you can then submit it. You can pay by cash, money order, bank check, or credit/debit card; if you do so by 7:00 pm, then they’ll issue the certificate the next business day.
If you pay with an electronic check before 7:00 pm, then they’ll issue the certificate in three business days. Those paying with a paper check will get their certificates in 10 business days. If you’d like to expedite the service, you can pay an additional fee.
Request a Tax Massachusetts Certificate of Good Standing Online
If you need a certificate of good standing for tax purposes, or if you’re closing/selling your business, then you’ll get it from the Massachusetts Department of Revenue (DOR). The good news is that this certificate is free.
To start, you’ll go to the MassTaxConnect page. If you already have an account, then you can log in.
Click on “More,” and then “Other actions.” Here, you can click on “Request a certificate of good standing.” If you don’t have an account, then select “Individuals” and then “Request a certificate of good standing.”
Now you’ll see “Enter application information”; pick “Certificate of good standing” from the dropdown list, then fill in your information. Hit “Submit” and they should mail out your document in 24-48 hours. Some certificates can also be printed through MassTaxConnect if you need the paper sooner.
How Long Is an MA Certificate of Good Standing Valid For?
Technically speaking, your State of Massachusetts certificate of good standing is valid as soon as it’s issued, and it doesn’t have an expiration date.
However, in practice, requestors don’t usually accept certificates that are over 60-90 days old. Because they want to make sure that your company is in recent good standing, anything over three months old probably isn’t valid anymore, as things may have changed since the certificate was issued.
Get a Certificate of Good Standing in Massachusetts
While you won’t immediately need a certificate of good standing in Massachusetts after creating a company, there’s a good chance that you’ll need one in the future.
Thankfully, you now know how to request one, so when the time comes, you’ll know exactly what to do. As a result, you’ll have a smooth process with little stress.
Sign up with Business Anywhere today if you’re interested in starting your own company. Not only do we have a free business registration service, but also other affordably priced services too.
