How to Form an LLC in Michigan
This guide to starting an LLC in Michigan provides step-by-step instructions on filing formation documents, obtaining tax IDs, and setting up company records.
Overview
LLCs are the most popular business structure because they are inexpensive to form, provide flexibility to the owners, and are easy to run. Forming your LLC legally establishes your business, limits your personal liability, and gains tax flexibility. The following step-by-step will help you as you undertake this process.
Fast Facts: Your Budget and Timeline
Here is an overview of the total paperwork, cost, and time it takes to form an LLC in Michigan. Be sure to read the final step in this guide - "Ongoing Filings" - to understand your ongoing costs to maintain a compliant Michigan LLC.
- Form CSCL/CD-700: Articles of Organization for use by Domestic Limited Liability Companies
- Operating Agreement
- IRS Form SS-4: Obtain an EIN
- Form 518: Registration for Business Taxes
- Formation: $50 + optional $50-1,000 expedite service
- Formation: ~5-7 business days with returned documents in ~4 weeks. ~24 hours for $50. Same day for $100. 2 hours for $500. 1 hour for $1,000.
Step-by-Step Michigan LLC Instructions
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Check Name Availability
The legal name of your LLC may not conflict with any other registered name. Check availability of your desired name by conducting a name search.
Name Search: Michigan Department of Licensing and Regulatory Affairs (LARA) - Bureau of Corporations, Securities & Commercial Licensing - Corporations Division
Name searchName Reservation: Optional Suffix: The name of a domestic limited liability company shall contain the words "limited liability company", or the abbreviation "L.L.C." or "L.C.", with or without periods or other punctuation. The name of a low-profit limited liability company shall contain the words "low-profit limited liability company", or the abbreviation "L.3.C." or "l.3.c.", with or without periods or other punctuation.
23 MCL §450.4204 -
Appoint a Registered Agent
Before you officially file to create your Michigan LLC, you will need to decide who your Michigan registered agent will be. A registered agent is a business's legal appointee to receive notice of lawsuit and other legal or government notices.
State law requires every LLC to have a registered agent. The registered agent is designated when you file Michigan articles of organization with the Michigan Department of Licensing and Regulatory Affairs (LARA) - Bureau of Corporations, Securities & Commercial Licensing - Corporations Division.
Our reliable registered agent service fulfills this requirement. You get:
- Same-day documents from our local office in Okemos
- Immediate online access to state forms with our address and, where required, our signature
- Annual fees from $89 to $99 per state with no additional charges
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File Michigan Certificate of Formation
File the articles of organization to create your limited liability company.
Agency: Michigan Department of Licensing and Regulatory Affairs (LARA) - Bureau of Corporations, Securities & Commercial Licensing - Corporations Division Form: Filing Method: Mail, in-person or online. MICH-ELF filers may file by fax or e-mail.
Agency Fee: $50 + optional $50-1,000 expedite service
Turnaround: ~5-7 business days with returned documents in ~4 weeks. ~24 hours for $50. Same day for $100. 2 hours for $500. 1 hour for $1,000. See Expedited Service Request
Law: Notes: - Submit one original of this document. Upon filing, the document will be added to the records of the Corporations Bureau. The original will be returned to your registered office address, unless you specify otherwise. There are separate formation forms, fees, and instructions for a Michigan professional LLC.
- Veteran-owned LLCs can apply to have the formation fee waived by following the instructions on this page.
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Establish Company Records
Your LLC must keep correct and complete books and records. Your filed articles of organization are the first documents for your LLC’s records. Your LLC will generate many other official records such as:
- Meeting minutes
- Operating agreement
- EIN verification letter
- Amendments and other filings made to the LLC throughout its lifetime
Organizations need a secure, centralized tool for managing and accessing sensitive records. Our Records Manager software offers a simple, efficient way for LLCs to store records, track members and managers, and customize meeting notifications.
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Create the Operating Agreement
Draft an Operating Agreement (potentially using a template) which is the governing document for the LLC. It defines the formalities of how the LLC will run itself such as holding an annual meeting. You will review and adopt the agreement at your organizational meeting.
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Hold the Organizational Meeting
The first meeting of the members of the LLC is the organizational meeting. You will need your filed articles of organization and your operating agreement in order to conduct this meeting. Keep minutes of this meeting and store them in your company record book.
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Get a Federal Employer Identification Number (EIN)
If your LLC has more than one member or will hire employees, it must obtain an EIN. An EIN is also often required to open a bank account.
Agency: Internal Revenue Service (IRS) Form: Filing Method: Mail, phone, fax, or online.
IRS fee: $0
Turnaround: Immediately online or by phone. 4 business days by fax. 4-5 weeks by mail.
Notes: The IRS website is only available during certain hours. Print your EIN before closing your session. For additional guidance, see IRS Pub 1635: Understanding Your EIN.
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Get Michigan State Tax Identification Numbers/Accounts
Register with the Department of Treasury for Sales Tax, Use Tax, Income Tax Withholding, Corporate Income Tax, Flow Through Withholding, Unemployment Insurance Tax.
- Submit to:
- Michigan Department of Treasury
http://www.michigan.gov/treasury - Form:
- Form 518: Registration for Business Taxes
- Filing Method:
- Mail, fax, or online
- Fee:
- $0
- Turnaround:
- 6+ weeks
- Notes:
- Mail your application at least six weeks but not more than six months, before you intend to start your business to allow your registration to be processed. The treasury will forward your application to Unemployment Insurance Agency (UIA).
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Consider Electing S-Corp or C-Corp Taxation
By default, your LLC receives pass-through taxation and the vast majority of LLCs keep this tax classification. Some LLCs benefit from electing S-Corp or C-Corp tax treatment:
- S-Corp treatment can help owner-employees who earn more than ~$75,000 per year save on self-employment taxes. File Form 2553: S-Corp Election.
- C-Corps suffer from double taxation: the corporation pays taxes on profits then members pay taxes on their distributions. If profits exceed $250,000 per owner, you provide employee benefits, or you will re-invest most of your profit in the business, you may benefit from the low tax rates on retained earnings under C-Corp treatment. File Form 8832: C-Corp Election.
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Obtain Business Licenses & Permits
To run your business legally, you must obtain applicable licenses and permits. The easiest way to navigate the wide range of federal, state, and local requirements is to search by your business type and locality using the Small Business Administration Business License & Permit look-up tool.
Michigan Business License
Not required
General Business License licensure is not required on the State level in Michigan.
Michigan does not have a general business license at the state level, but local licenses are often required.
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Ongoing Filings to Maintain Your LLC
You must file federal and state tax returns.
Many states also require business entities to file an annual report to maintain good standing with the secretary of state. If an annual report is required for LLCs formed in Michigan, view the table below.
Michigan Corporation Annual Report Requirements:
Agency: Michigan Department of Licensing and Regulatory Affairs (LARA) - Bureau of Corporations, Securities & Commercial Licensing - Corporations Division Form: Pre-printed form is mailed to your registered agent.
Filing Method: Mail, in-person, or online.
Agency Fee: $25
Due: Annually by May 15.
Law: Michigan Code § 450.1911
Penalties: $10/month, maximum $50 late fee.
Notes: - Anyone with authority may file.
- Original signatures are not required.
- If you file online, the filed report will appear on the website in ~1 hour.
- Veteran-owned corporations can request a waiver of the annual report fee by following the instructions on this page.
For more details, see our Michigan annual report information center page.
As your LLC grows, you will need to demonstrate your company’s good standing to banks, customers, and other state agencies. After all the work involved in forming your Michigan LLC, don’t let a missed annual report filing cause your new business to fall out of compliance.
Tracking and filing annual reports on your own can be time consuming and lead to accidental lapses. Protect your LLC’s good standing with Managed Annual Report Service, which tracks and automatically files reports on time, every time, so you can focus on your business.
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