How to Syndicate an Apartment Deal in Massachusetts

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What is the Massachusetts Rule 506 notice filing?
How do you form the deal LLC in Massachusetts?
What Massachusetts landlord and tenant rules should a sponsor know?
Why does lead paint matter in Massachusetts?
What does Massachusetts charge when an apartment building sells?
How does Massachusetts property tax work for an apartment building?
Does Massachusetts tax the deal LLC or its investors?
How DoorRaise fits in
FAQ

To syndicate an apartment deal in Massachusetts, you form the deal LLC (or register an outside LLC with the Secretary of the Commonwealth), raise under Rule 506(b) or 506(c), and file a Form D notice through NASAA's EFD; DoorRaise's state data lists the fee as $250 for an offering up to $2,000,000, $500 up to $7,500,000 and $750 above. Massachusetts tenant law is strict and the penalties are large: a security deposit mistake can cost three times the deposit, and the lead paint law applies whenever a child under six lives in a unit.

This is the Massachusetts version of our general syndication guide. It covers what changes when the building, the investors or both are in Massachusetts. It is general information, not legal advice.

What is the Massachusetts Rule 506 notice filing?

Massachusetts treats Rule 506 interests as federal covered securities and asks for a notice: a copy of the SEC Form D and the fee, filed through the NASAA Electronic Filing Depository (EFD) for the Securities Division of the Secretary of the Commonwealth. DoorRaise's state data, from NASAA's fee schedule, lists the fee as $250 for an offering up to $2,000,000, $500 up to $7,500,000 and $750 above. File within 15 days of the first sale to a Massachusetts investor. EFD shows the exact amount before you pay, and that amount wins. See blue sky notice filings and blue sky fees by state.

How do you form the deal LLC in Massachusetts?

A Massachusetts LLC is formed by filing a Certificate of Organization with the Corporations Division of the Secretary of the Commonwealth; the published fee is $500. Each year the LLC files an annual report, also $500, on its anniversary date. An LLC formed elsewhere that will own Massachusetts property registers as a foreign LLC, at a similar cost. Those yearly fees are higher than in most states, so include them in the operating budget. See forming an LLC for a syndication and keeping the LLC in good standing.

Under the security deposit law (M.G.L. c. 186, s. 15B), a landlord may collect at most first month's rent, last month's rent, a security deposit of no more than one month's rent and the cost of a lock change. The deposit must go in a separate interest-bearing account at a Massachusetts bank, the tenant must get a receipt and the bank details, interest is owed each year, and the deposit is returned within 30 days after the tenancy ends. A landlord who breaks these rules can owe three times the deposit plus interest and legal fees. When you buy a building, the deposits and the duty to account for them pass to you, so confirm the seller's records at closing. Massachusetts has had no rent control since a 1994 statewide vote, though proposals to change that are debated. For unpaid rent, a landlord serves a 14 day notice to quit before filing a summary process case.

Why does lead paint matter in Massachusetts?

The Massachusetts Lead Law requires an owner to delead or bring under interim control any unit built before 1978 where a child under six lives, whether or not the child has been poisoned, and an owner may not refuse to rent to a family because of it. Much of the state's apartment stock is older, so ask for the seller's lead compliance letters, budget for deleading units without them, and see lead-based paint rules for apartment buildings.

What does Massachusetts charge when an apartment building sells?

The deed excise tax is $4.56 per $1,000 of price in most counties (Barnstable County has a different rate), usually paid by the seller. Some towns have adopted or proposed local transfer fees. Put any share you owe in sources and uses.

How does Massachusetts property tax work for an apartment building?

Assessors in each city and town value property at full market value as of January 1, and Proposition 2½ limits how much a town's total levy can grow each year. Many cities tax residential property, including apartments, at the residential rate, which is lower than the commercial rate in towns that split rates. Owners can apply for an abatement with the local assessor, then appeal to the Appellate Tax Board. Underwrite taxes from your price and the residential rate. See property tax reassessment in apartment underwriting.

Does Massachusetts tax the deal LLC or its investors?

Massachusetts taxes income earned in the state, and a partnership may have to withhold for nonresident partners or file a composite return. Massachusetts also has a 4% surtax on income above about $1 million. Ask your CPA early; the investor side is in state tax returns for nonresident syndication investors.

How DoorRaise fits in

DoorRaise helps sponsors raise equity for apartment buildings from their friends and followers under Rule 506(b) or 506(c), and verifies that every investor is accredited before they sign. Investors fund by wire into the deal's escrow account at Enterprise Bank & Trust. By default DoorRaise files the notice in the property's state; on new deals, the first investor from another state pays that state's filing fee by card when they sign, later investors from that state pay nothing, and the sponsor never fronts it. Sponsors pay a $1,500 setup fee (non-refundable) and a flat $5,000 a year administration fee; see pricing or how it works.

FAQ

How much is the Massachusetts Rule 506 notice fee?

$250 up to a $2,000,000 offering, $500 up to $7,500,000 and $750 above, per NASAA's fee schedule. EFD shows the final amount before you pay.

What does a Massachusetts LLC pay each year?

A $500 annual report fee.

What happens if a Massachusetts landlord mishandles a deposit?

The landlord can owe three times the deposit plus interest and legal fees.

Does Massachusetts have rent control?

No. A 1994 statewide vote ended it, though proposals to bring it back are debated.

Sources

This article is general information as of November 2026, not legal, tax or investment advice. State laws and fees change: confirm with the state agency and your own attorney before you file. DoorRaise is not a law firm, broker-dealer, investment adviser or funding portal.