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If you’re dreaming of starting a business in Michigan, establishing a Limited Liability Company (LLC) is ideal, as it can provide credibility, tax advantages, and separation of personal and business liabilities.
Additionally, forming an LLC in Michigan offers the advantage of relatively low filing fees, making it an attractive option for entrepreneurs looking to establish their business entity cost-effectively within the state.
However, establishing an LLC is not a trivial task. It involves several critical steps that demand a thorough comprehension of Michigan’s business regulations, including filing necessary documents and adhering to continuous reporting obligations. Errors in compliance could lead to severe legal and financial penalties, potentially derailing your business ambitions.
The process is intricate and demands detailed focus, but our straightforward guide aims to simplify it. Let’s dive in!
Short on Time? Here’s a Quick Guide To Starting an LLC in Any US State:
Below are the essential steps for establishing an LLC in any US jurisdiction, though specific steps for Michigan are elaborated in our detailed guide below this section. Always seek advice from a legal professional, Michigan’s Department of Licensing and Regulatory Affairs, or one of our top-recommended LLC formation services for precise, current information.
Choose a compliant and distinct business name for your LLC that is in line with Michigan’s regulations.
Designate a Registered Agent who will handle your LLC’s legal and official communications. This could be you, a colleague, or a third-party like ZenBusiness LLC formation service1.
File your Articles of Organization with Michigan’s Department of Licensing and Regulatory Affairs. This document should include essential details like your LLC’s name, address, and your Registered Agent’s contact information.
Acquire an Employer Identification Number (EIN) from the IRS and register for relevant Michigan taxes and licenses. While obtaining an EIN is generally optional, it becomes necessary if you plan to hire employees or open business accounts.
How To Start an LLC in Michigan in 8 Steps
Before beginning, consider the following essential points:
LLC members must handle taxes individually unless they opt to be taxed as an S-Corporation or C-Corporation.
Depending on your business type, additional local or state licenses may be required.
1. Select a name for your LLC
Opt for a name that represents your business while adhering to Michigan’s naming conventions. The name should be unique, not closely resemble any existing entities, and must include an LLC identifier like “LLC” or “Limited Liability Company.” Verify the availability of your chosen name via a search on Michigan’s Department of Licensing and Regulatory Affairs website.
Additionally, consider securing a domain name for your business, which is included with an LLC formation package from Tailor Brands1.
2. Designate a Registered Agent
A Registered Agent is mandatory, as they will be responsible for receiving legal notices and government correspondence on behalf of your LLC. Your Registered Agent must have a physical Michigan address (no P.O. boxes) and be available during standard business hours.
You can appoint another LLC member (if you’re a partnership), a trusted friend, a professional Registered Agent service like ZenBusiness, or yourself.
You should send your Articles of Organization to Michigan’s Department of Licensing and Regulatory Affairs for a fee of $50. It must include at least the following information:
LLC business name
Business purpose
Address of the principal office
Registered Agent’s details
Maximum duration of business operation
Organizer’s name(s) and signature(s)
4. Create an LLC Operating Agreement
While not mandatory in Michigan, an Operating Agreement is advisable as it outlines the ownership and operational procedures of your LLC. This document typically details:
Ownership percentages of members
Rights and responsibilities of voters
Distribution of profits and losses
Management structure (member-managed or manager-managed)
Member addition and removal processes
An Operating Agreement can help prevent internal conflicts by providing clear operational directions.
5. Get an Employer Identification Number (EIN)
An EIN is a unique business tax number issued to you by the IRS. It’s crucial for tax purposes, hiring employees, opening business accounts, and helping maintain your LLC’s liability protection.
Single-member LLCs without employees may use their Social Security Number for tax purposes, but obtaining an EIN is generally advisable to separate your finances and maintain limited liability protection.
6. Register for state and local taxes
Depending on your LLC’s activities and location in Michigan, you may need to register for various additional taxes, including:
Michigan Corporate Income Tax (CIT)
Michigan Business Tax (MBT)
Streamlined Sales Tax
Property tax
Unemployment insurance tax
For detailed registration requirements, consult Michigan’s Department of Licensing and Regulatory Affairs or a professional LLC formation service.
7. Get any necessary licenses and permits
Depending on your industry and location, your LLC may need specific licenses or permits to operate legally in Michigan. These might include licenses and permits for:
Environmental compliance
Construction and building
Liquor control
Health and safety regulations
Sales tax
Professional or occupational activities
Zoning and land use
Check on Michigan’s Department of Licensing and Regulatory Affairs and your local government sites for the required permits and licenses, or seek assistance from a service like ZenBusiness, which can tailor a plan to meet your specific needs.
It’s necessary to keep your LLC in good standing in Michigan, so be sure to adhere to the following ongoing requirements:
Submit an Annual Statement by February 15, updating key business details for a fee of $25.
Maintain a Registered Agent with a valid physical address consistently within the state.
Fulfill state and federal tax obligations on time, including filing and paying any owed taxes before deadlines.
Renew all necessary licenses and permits as required. Failure to do so may result in fines or legal trouble.
Staying informed and proactive in these areas will help maintain your LLC’s good standing and protect its limited liability status. However, it can be complex and time-consuming to do so. So, consider using one of our reviewed business service providers for ease.
Discover the Top LLC Formation Services in Michigan
There’s a wide array of LLC formation services available. When selecting the top options for Michigan LLCs, we prioritized the following criteria:
A free plan (not including mandatory state fees) offering significant savings.
Comprehensive paid plans that deliver the best overall value, irrespective of their price.
Distinctive features that make the service stand out from the competition, including creative services, financial tools, and specialized legal consultations.
User-friendly service, ensuring a hassle-free experience.
Reliable customer support for assistance and guidance as you start your venture.
Adaptable plans and services tailored to meet the diverse needs of various businesses.
Below are our preferred LLC formation services for setting up an LLC in Michigan.
ZenBusiness’ worry-free services include its compliance service that handles your ongoing state filingsZenBusiness provides a trustworthy LLC formation service for your side hustle or ambitious enterprise. Its plans and product bundles are highly customizable to fit any budget. It offers a free plan1, along with two paid tiers: Pro and Premium.
The free plan has a filing time of 2–3 weeks, but you can opt for an add-on to expedite the process. The Pro and Premium plans offer a filing time of 1–2 days. All plans come with a 100% Accuracy Guarantee, ensuring that ZenBusiness will not make any errors in the details.
An additional advantage of all ZenBusiness plans is the inclusion of ZenBusiness Money Essential – a complimentary financial management tool for automatic expense tracking. You have the option to upgrade to its paid version, ZenBusiness Money Pro, which assists you in tracking expenses, income, invoicing, mileage, taxes, and more. If you are uncertain about your requirements, you can sign up for a free 30-day trial of ZenBusiness Money Pro and compare the features.
Features
Tax consultations. As a new customer, you’ll benefit from a complimentary 30-minute tax consultation through ZenBusiness’ partner, 1-800Accountant.
Mobile app. Manage your account on the go with ZenBusiness’ mobile app, available for both Android and iOS devices, in addition to desktop access.
Website builder. With the Premium plan from ZenBusiness, you gain access to its exclusive website builder and get a free domain name and email address.
Full customization. Tailor your free ZenBusiness plan to fit your needs perfectly with paid add-ons – you only pay for the services you require.
Tailor Brands not only offers LLC formation services but also design and marketing toolsTailor Brands offers a wide array of visual design and marketing tools, as well as additional services, surpassing basic LLC formation. With Tailor Brands, you gain access to graphic design, an AI logo maker, and other marketing and digital tools.
Tailor Brands has a free “plan generator”1 that constructs a checklist to guide you from your current stage to your LLC’s full launch. You only need to provide some information about you and your business. While you’ll be prompted to consider buying its plans and services along the way, if you’re transitioning from the idea phase to action in your business-building journey, the plan generator serves as a useful guideline.
Features
Free logo maker. Tailor Brands offers a complimentary AI logo maker with all plans, with enhanced features available in the Elite plan.
Zazzle partnership. Kickstart your merchandise through Tailor Brand’s exclusive partnership with Zazzle.
In-house web design. Tailor Brands provides custom website design services for a fee to enhance your business’s online presence.
Trademark support. Get help with trademark application as an additional service.
Swyft Filings helps you quickly deal with your LLC formation and paperworkSwyft Filings’ LLC filing process1 demands minimal easy-to-complete paperwork, making it beginner-friendly for you as a new business owner. You’ll only need a few minutes to sign up, and once you do, you’ll gain access to Swyft Filings’ client account dashboard, which is incredibly user-friendly.
Swyft Filings assists you in staying tax-compliant too. Every plan includes a free 14-day trial of ComplianceGuard, which facilitates state business compliance maintenance by providing annual reports, meeting minutes, and notifications for due filings. Swyft Filings accompanies you throughout your journey from being a new face to becoming an established name in the business world.
Features
EIN application. Included for free with Standard and Premium plans.
Business license applications. Swyft Filings provides research and application services for licensing and permits as a paid add-on.
Specialty documents. Access to essential documents like Operating Agreements and banking resolutions with Standard and Premium plans.
Free Basic plan: Swyft Filings offers a basic package that includes all the essentials for LLC formation.
Forming an LLC doesn’t have to be a complex ordeal. Our top three recommended company formation services simplify the entire process, helping you focus on what truly matters – growing your business.
Whether your LLC is just starting out or scaling up, ZenBusiness offers plans designed to meet a variety of needs1, including a free plan. It stands out with features like a 100% Accuracy Guarantee and ZenBusiness Worry-Free Compliance included in every plan.
For those focused on brand development, Tailor Brands is an excellent choice1, known for its extensive creative and marketing services. It covers everything from your logo to your website.
If you’re new to business and seeking thorough guidance, Swyft Filings is the go-to option1. It provides a user-friendly signup and client dashboard that makes starting your LLC straightforward and stress-free.
Here are our top picks for Michigan, summarized:
What steps must I take to start an LLC in Michigan?
To initiate an LLC in Michigan, adhere to the protocols specified by Michigan’s Department of Licensing and Regulatory Affairs. This includes selecting a unique LLC name, submitting your Articles of Organization, and settling the requisite filing fee. You can complete these steps independently or utilize an LLC formation service to ensure accuracy.
What benefits does starting an LLC in Michigan offer?
Forming an LLC in Michigan provides separation between personal and business assets, flexible management options, and low filing and renewal fees. Michigan is thus an attractive location for business growth and opportunities.
How can I start an LLC in Michigan for free?
You can either file an LLC yourself on Michigan’s Department of Licensing and Regulatory Affairs website or employ a business formation service. While state fees are mandatory, you can minimize costs by choosing a free or low-cost formation plan from a service like ZenBusiness.
Which LLC formation services offer Registered Agent services?
Many LLC formation services, like ZenBusiness, offer Registered Agent services, although they are generally not all complimentary or included with LLC formation packages. However, some business formation services do include these free, such as Northwest Registered Agent and Bizee. You can find more options in our list of the best LLC formation services in 2024
A freelance author, graphic designer, and photographer, Caitlin Greyling writes about web hosting, web builder software, graphic design, tech, and electronics, and has published hundreds of product reviews and comparisons for Website Planet, The Daily Mail, and Durability Matters. Her creative and technical knowledge has been showcased at PictureCorrect, Photutorial, and others. She is currently studying for an NCTJ diploma in journalism. When Caitlin’s not working, she’s exploring nature with her son and dog or relaxing at home with her cat.
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