Although the process of forming an LLC is identical across the United States, there are some key differences between states. This guide will show you how to create an LLC in Michigan. We will guide you step-by-step through the process and highlight important considerations.
Before you create an LLC in Michigan
There are some important details you need to know before you file an LLC. You will need to ensure that the name you choose for your business entity can be registered. These sections detail the steps you need to follow before filing your LLC.
Michigan Limited Liability Company Act
The Michigan Limited Liability Company Act 1993, which was amended in 2002, outlines the process of forming and operating LLCs. This law provides details on how LLCs should operate in Michigan.
Michigan LLC Setup Costs
In Michigan, the filing fee for creating an LLC is $50. Additional fees can be added to speed up the process. These fees range from $50 to $1,000, depending on how fast you need your LLC to be formed. Annual reports will cost $25 for a standard LLC and $75 for a professional LLC.
Michigan Business Resources
Setting Up Your LLC in Michigan
Register Your Business Name
Your LLC name must be distinguished from any corporations, LLCs, or limited partnerships that have been established in Michigan. The search engine of the Department of Licensing and Regulatory Affairs can help you determine whether there is availability.
After you have confirmed the availability of your name, you can submit an Application to Reservation Name to reserve it for six months. The documents can be submitted:
- Post to P.O. Mail to P.O.
- Visit us in person at 2407 N. Grand River Ave. Lansing, MI 48906
A $25 fee is required to submit the form. This can be paid by check or money order payable to State of Michigan. You can pay online or in person by using your credit card. For more information, call (517) 261 6470.
Guidelines for Naming Your LLC
Name your Michigan business with a “limited liability company,” or any of the abbreviations LLC, L.L.C., LC, or LC. For a professional limited liability, include the exact term or one the appropriate abbreviations, “PLLC,” or “PLC.”
Certificate of Assumed Title
Do you have a nickname for your company or an alternate name that you would like to associate with your LLC. You can request a Certificate Of Assumed Name if the name or names are in Michigan.
Appoint a Resident Agent
Michigan law requires LLCs to include a resident agent as well as a registered office in the articles of organization. To accept legal documents, demands, or notices on behalf the LLC, the agent must have a Michigan physical address. If you are at least 18 years old and have a physical address in Michigan, it is possible to be your own resident agent.
A resident agent can be hired if you don’t live in Michigan or want to delegate your services to someone outside of the company. While the cost can be as low as $50 per annum, it is usually between $100 and $150. It is important to carefully review the services available and determine if they are within your budget.
File the Articles of Organization/Certificate of Authority
After you have hired a resident agent, and established your registered office, it’s time to submit your LLC registration documents. Articles for Organization are filed by domestic and local businesses. You must fill out a Certificate of Authority form if your company was established outside of Michigan and you wish to do business in Michigan.
Michigan encourages you fill out and submit your document online. However, you can also print it and mail it. The filing fee is $50. You can pay the filing fee in $50 by mail.
Editing the Process
You can speed up the filing process if you’re willing to pay more.
- For $50, you can get 24-hour assistance with your formation documents (or a Certificate of Authority).
- $100 Same-day service for documents of formation (or Certificate of Authority)
- If documents are received before 3 p.m., they will be reviewed in two hours. ET: $500
- If documents are received before 4 p.m., they will be reviewed in one hour. ET: $1,000
When submitting documents by mail, please note that the Corporations Division will expedite based on the date of receipt. You must file a separate CSCL/CD-272 form for expedited service for each document.
After Forming Your LLC in Michigan
After successfully establishing your Michigan LLC, you will need to follow additional steps.
Limited Liability Company Annual Report
All LLC owners are required to file a report each year under the Michigan Limited Liability Company Act. The annual report must be filed no later than February 15, but foreign LLCs and LLCs formed after September 30, are exempt from filing a report for the year.
Professional LLCs must submit annual statements that confirm each manager or member is licensed in the industry in which they provide services.
Standard LLCs have to pay a $25 annual fee. Annual statements for professional LLCs cost $75.
Certificate of good standing
Maintaining your LLC’s good standing is important once you have set it up. This includes:
- Submit your annual report with the associated fee
- Maintaining a registered Agent
A Certificate Of Good Standing is required to verify the legitimacy of your LLC. You can order the certificate online, by phone, or by mail for $10. You can order the certificate online or by mail, but checks and money orders should be made payable the State of Michigan. Credit card payments are accepted if you order online.
Restore Your LLC’s, Good Standing
Do not worry if your LLC is in bad standing. You can easily restore its good standing by filing a Certificate of Restoration of Good Standing along with past due annual statements or fees. You will need to complete two forms: domestic or foreign LLCs. Ensure you send the appropriate documents and the $50 filing fee. To expedite the process, you can pay $100-$1,000.
Additional considerations for LLC
You will need to do more to ensure that your LLC succeeds.
- Create an operating agreement. This document is not required but it can help ensure that your LLC operates in a legally compliant manner.
- Get an Employer Identification Number or EIN. LLCs must have multiple members and those with employees. You can obtain one today through the IRS website.
- Check online for the availability of your business name. This will help you to brand.
Most Frequently Asked Questions
What is an LLC?
A limited liability company combines the flexibility and ease of a sole proprietorship or partnership structure with the greater risk protection offered by a corporate structure. LLC owners, also known as “members”, have limited liability. This means that their personal liability to the company is limited to what they have invested. It does not cover losses or debts beyond that amount.
Members of an LLC are subject to taxes by default. This is the same as for owners of a general partnership or sole proprietorship. This structure is commonly referred to as a “pass-through” tax structure. If the LLC meets certain criteria, it can choose to be taxed either as a C corporation C corp (S-corp), or as an S corporation (Scorp). Small business owners prefer LLCs because of their simplicity and flexibility.
What is the cost of setting up an LLC in Michigan?
For domestic and foreign businesses, it costs $50 to set up an LLC in Michigan. It usually takes 10 to 15 days.
Can my Michigan LLC operate under a different business name?
Michigan allows you to operate an LLC under multiple trade names. However, you must fill out a Certificate Of Assumed Name to allow for additional pseudonyms.
Can I be my own Michigan resident agent?
Michigan allows you to be your LLC’s resident agent, provided you are at least 18 years old and have a physical address in Michigan.
What is the cost of registering an LLC?
Costs vary by state. The filing fee in Michigan is $50. In Massachusetts, however, it costs $500 to create an LLC. It is important to research the options and plan accordingly.