If you are looking for the best guide on how to start an LLC in Michigan, take a breath and read this.
Starting an LLC in Michigan requires legal processes to keep your business working.
So, in this article, we will provide you with a complete guide on how to start an LLC in Michigan with ease.
How to Start an LLC in Michigan
Starting an LLC in Michigan requires filing Articles of Organization with the Michigan Department of Licensing and Regulatory Affairs.
This process costs $50 and can be done online, by mail, or in person.
Meanwhile, the Articles of Organization are vital as the legal document officially establishes your Michigan limited liability company.
Steps to Start an LLC in Michigan
Follow the steps below to form your LLC in Michigan easily.
- Choose a name for your Michigan LLC
- Appoint a registered agent
- File Articles of Organization
- Prepare an Operating Agreement
- Get an EIN & comply with other tax & regulatory requirements
- File annual statements
However, if you find these processes daunting, you can seek professional services.
Choose a Name for Your Michigan LLC
The first thing you should do is to give a delectable business name to your LLC.
As much as you would like to use a name you so desire, you must be sure that another business hasn’t used the name.
However, you can check names for availability on the Michigan business database.
Also, you can reserve a name for six months by filing an Application for Reservation of Name with the Michigan Department of Licensing and Regulatory Affairs.
In addition, you can mail the application or file online for $25.
Here are a few guides on how to choose a name for your LLC in Michigan
- Your business name must include ability company” or its abbreviations (LLC or L.L.C.).
- Ensure that your name is distinguishable from any Michigan limited liability company, corporation, limited partnership, or registered limited liability partnership business name.
- Ensure the name you desire isn’t already taken by doing a Business Entity Search on the Michigan Secretary of State’s website.
- Your business name cannot contain words used to name a government agency (i.e., State Department, CIA, FBI, Treasury, etc.)
- Also, it can’t contain certain restricted words like bank, lawyer, attorney, credit union, etc.
- Ensure to Reserve the name once you find the availability: You must complete the Name Reservation Request for Domestic Entities form at least two weeks before registration or reserve your business name when completing the online LLC registration.
- Consider if the URL is available: Check online to see if your business name is known as a web domain. If it is, you may want to buy the URL to prevent others from acquiring it.
Furthermore, you don’t have to use your LLC’s legal name when you do business. Instead, you can use an assumed or fictitious business name, “DBA,” or trade name. However, you must register your assumed name with the Michigan Department of Licensing and Regulatory Affairs.
Also, you register by mail by filing a Certificate of Assumed Name for $25.
Meanwhile, the registration is suitable for five years.
Appoint a Registered Agent
Every LLC in Michigan must have a service of process in the state.
A registered agent is an individual or business entity that agrees to accept legal papers on the LLC’s behalf if someone sues the company.
However, a registered agent may be a Michigan resident, a Michigan corporation, a foreign corporation with a certificate of authority to transact business in Michigan, a Michigan LLC, or a foreign LLC authorized to transact business in Michigan.
In addition, the registered agent must have a physical street address in Michigan.
File Articles of Organization
You can create an LLC in Michigan by filing Articles of Organization with the Michigan Department of Licensing and Regulatory Affairs.
However, the articles must include:
- the LLC’s name
- the LLC’s purpose
- whether the LLC’s duration will be perpetual or for a specified period
- the name and address of the LLC’s registered agent
- the effective date of filing the Articles if later than the date of filing, and
- signature and phone number of the LLC’s organizer.
Also, the articles may be filed by mail or online for 50.
Prepare an Operating Agreement
Even though the state does not require an LLC operating agreement in Michigan, it is highly recommended.
This operating agreement is an internal document that establishes how you will run your LLC.
Also, it sets out the rights and responsibilities of the members and managers, including how you will manage the business.
In addition, it helps preserve your limited liability by showing that your LLC is a separate business entity.
However, the state LLC law will govern how your LLC operates without an operating agreement.
Get an EIN & Comply With Other Tax & Regulatory Requirements
As an LLC in Michigan, you must comply with additional tax and regulatory requirements that may apply to your LLC, which include the following:
EIN (Employer Identification Number): You need to get an EIN if your LLC has more than one member.
Also, it must have an IRS Employer Identification Number (EIN) if it has no employees and your company will have employees, or you elect to have it taxed as a corporation instead of a sole proprietorship.
However, you may obtain an EIN on the IRS Website at no cost.
Business Licenses: You need to get a business license depending on its type of business, and where it is located, your LLC may need other local and state business licenses.
Department of Treasury: Also, if you have employees or will be selling goods and collecting sales tax, you’ll need to register with the Michigan Department of Treasury (DOT) online or by mail.
File Annual Statements
All LLCs in Michigan must file an annual statement with the Department of Licensing and Regulatory Affairs.
However, the report must be filed by February 15, after the year of formation or qualification.
Meanwhile, if you form your LLC after September 30, you do not need to file a statement the following February.
Also, you can file the report online or by mail for $25.
How to Start A Foreign LLC in Michigan
If you have an existing LLC and you want to extend the business to Michigan, you need to register as a foreign LLC.
This is because forming a foreign LLC allows your company to operate as one entity in multiple states. If you have an existing LLC and want to do business in Michigan, you must register as a foreign LLC. This can be done online or by mail.
How to Obtain a Certificate of Good Standing in Michigan
In Michigan, the certificate of good standing is also called the certificate of legal status.
With a certificate of good standing, your business is verified that it was legally formed and adequately maintained in Michigan.
Meanwhile, you can order a Michigan LLC Certificate of Good Standing online for free.
You might need to get your certificate of legal standing if:
You will seek funding from banks or other lenders
You might form your business as a foreign LLC in another state
You will obtain or renew specific business licenses or permits
You can order a Certificate of Legal Existence online or by mail.
Online: Request a Certificate Online Through the Michigan Secretary of State.
As simple as filing an LLC in Michigan is, you will follow simple guides and requirements to get your LLC running in Michigan.
The steps have been simplified and explained in this guide on how to start an LLC in Michigan.
The first step to take on how to start an LLC in Michigan is to do a name search and reserve your name.
However, you must note that another business must not have used the name you choose for your LLC and ensure that the domain name is also available.
Also, you must Appoint a registered agent, file an article about the organization, prepare an operating agreement, Get an EIN & comply with other tax & regulatory requirements and file an annual report.
In addition, you must comply with all the additional tax and regulatory requirements.
We hope you find this guide on how to start an LLC in Michigan helpful.
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