- Office of Consumer Affairs and Business Regulation
When registering as a Home Improvement Contractor (HIC) with the Office of Consumer Affairs and Business Regulation (OCABR), contractors should be especially aware of the differences between registering as an individual contractor, with or without a D/B/A (doing business as), and registering as a corporation.
Some corporations organized outside of Massachusetts, and known as “Foreign Corporations,” continue to provide our Office with incomplete applications for Home Improvement Contractor registration, which can delay their registration process significantly. To help assist these Foreign Corporations in understanding what documentation is needed from them for the Office to process their applications quickly, we offer the following tips.
In order to lawfully do business in Massachusetts, state law requires a Foreign Corporation to file a certificate of registration as an organization with the Secretary of State within 10 days after it starts to transact business in the Commonwealth. This certificate should be accompanied by a “certificate of legal existence or good standing issued by an authorized officer or agency in the jurisdiction of organization.”
At the time of application for an HIC registration or renewal, a copy of the Foreign Corporation’s certificate of legal existence or good standing from its originating jurisdiction outside of Massachusetts must be provided to the OCABR. This is required as a prerequisite before an HIC application can be processed. Additionally, annual reports must be filed by Foreign Corporations the same way a domestic corporation or LLC is required to do. Failure by a domestic or foreign corporation to file its annual report with the Secretary of State within the prescribed time of two and one-half months of the close of the fiscal year may result in that Office’s dissolution of the corporation as filed with their Office. This action by the Secretary of State will also prevent the Office from processing and issuing the HIC registration or renewal application.
It is important to note that the responsibility for ensuring correct and timely paperwork rests wholly with the contractor applying for registration. Filing an incomplete or incorrect application can keep you, the contractor, from seeking and contracting with homeowners to perform home improvement projects and can jeopardize your ability to work as a contractor in Massachusetts in the future.
It is also worth noting, with regard to paying associated guaranty fund fees, that out-of-state employees do qualify as employees for purposes of 201 CMR 18. This means a Foreign Corporation should count employees, even if they do not perform residential contracting in Massachusetts, when calculating their required guaranty fund payment if the employee is engaged in construction related activities, and, in the weekly pay period prior to the date of registration, worked 20 or more hours for the employer and had federal or state income tax withheld by the employer. Included would be all construction workers, supervisors, sales personnel, designers, estimators, active partners and officers of corporations.
