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Are you looking to file a LLC in Michigan or check if your Michigan LLC name is Available? Before you do, you’ll need to take a few steps to get your business going. Filing your Michigan LLC Online is easier then ever before.
In a Hurry? You can file your Michigan LLC With Incfile for $0 plus state Filing Fees
Just because you have an idea and have chosen a business name, doesn’t mean it’s available. You must first do a Michigan Entity Search to see if your business name is available. Check out the steps below to get started.
Step 1: How to Perform a Michigan Entity Search
Your first step is seeing if your name is available. The Department of Licensing and Regulatory Affairs Business Entity Database has all of the information needed on corporations or LLCs in Michigan.
Using this system, you can run a Michigan Entity Search to see if your chosen name is available or taken.
You have a few options when searching the Michigan LLC search database. You can search by:
- Entity name
- Identification number
- Filing number
- Individual’s name
For the entity name or individual’s name, you can search by ‘starts with,’ ‘exact match,’ ‘keyword,’ or ‘soundex.’ The easiest way to do a Michigan business lookup is by business name and ‘starts with’ or ‘keyword.’ This will turn up all entries that are close to the search criteria you entered.
As you filter through the results, you can click on the hyperlink to get more information. If you’re just looking to find a business name, you’ll need to find a name that’s different from any names in the search results. Make sure your Michigan LLC name search is thorough. This avoids any delays when filing your paperwork to register a business name in Michigan.
Step 2: How To File an LLC in Michigan
Create Michigan LLC Online:
Thankfully for technology, Filing an LLC is easier today then ever before from the comforts of your own home instead of waiting in long lines at the Corporation Commission.
On the form, you’ll need your business name, purpose, time you will be in business, and the resident agent. Many companies leave the time blank, especially if they plan to stay in business ‘forever.’ The resident agent must be a resident of Michigan. It can be a person or a Resident Agent service that lives in Michigan.
You can be the resident agent yourself. Keep in mind, though, your address then becomes public record, which can cause a privacy issue.
After searching the If you want to file an LLC in Michigan, first you must come up with a different name then what is already in the database:
- Use the steps above to do a Michigan LLC search
- Include the abbreviation LLC in the name
- Avoid the use of any government identified words in the name
- Provide proof of licensure if you have a name that includes the word ‘bank,’ or ‘attorney’ for example
After you conduct the Michigan business lookup, you must file the Articles of Incorporation. The Articles of Incorporation create a separate entity for your business. This is separate from yourself.
The Articles of Incorporation are public information. Anyone can get your information including your business name, address, and stock information.
Step 3: File a Michigan DBA
Filing a DBA is not Mandatory, but it is needed if you intend on using a different name then your LLC Name. Some people choose to use a catchy DBA name for their business instead of a long form LLC name.
You can search to see if your Michigan DBA name is available through the LARA Database just like you did for the LLC.
Register Your Michigan DBA Online:
Swytfile offers a very affordable way to file your Michigan DBA online for $99 Plus State Filing Fees
All LLCs must register its DBA or assumed name with the Michigan Department of Licensing and Regulatory Affairs. The DBA or ‘doing business as’ name registers the business name under your LLC’s name. It’s required for anyone doing business in a name other than the legal LLC name.
Just like you did when you filed for the LLC, you’ll do a Michigan business search for the DBA name in the LARA database. Search by entity name to determine if the name you chose is available. The name your LLC operates as must be unique. Searching with the ‘starts with’ or ‘keyword’ filter chosen will provide the best results for your Michigan DBA search.
Step 4: Buy Your Domain Name and Hosting Plan
Once You have registered your LLC and DBA and verified that your Domain Name is available, it is important to purchase your ideal Domain Name and Hosting Plan for your Michigan Business Name.
You can sign up for a FREE domain Name through NameCheap with qualified Hosting Plan.
Step 5: Operating Agreement (Optional)
Occasionally, LLC’s need an Operating Agreement to outline who makes decisions for the business if there are multiple people involved in the business. The agreement helps protect the members of the LLC from lawsuits. It also helps put all agreements in writing. With all operational agreements in writing, there’s no risk of confusion.
Legalzoom has the best online Operating Agreement’s from our experience. They have some options starting at $99.
Without an Operating Agreement, the state of Michigan’s operating rules would rule should there be an issue. This is typically not a good idea since the laws are generic. They don’t have laws for each industry/business type.
Operating agreements including information such as:
- Ownership breakdown by percentages
- Rights and responsibilities of each owner
- Financial breakdown including profit distribution
- Meeting obligations
- Rules for buyouts and selling, including in the event of an owner’s death
The state of Michigan doesn’t need an Operating Agreement for LLCs, but it’s always advisable. You can download a free template online or ask your attorney to draw one up for you.
STEP 6: File an EIN (Tax ID) for Michigan LLC
To open a business bank Account you will need a EIN/TaxID Number. You can file your Michigan TAX ID online through IncFile for $70
The EIN is also known as the Federal Tax Identification Number. This number is the equivalent of your personal social security number for your business. You need an EIN if you:
- Operate as a corporation or partnership
- File employment tax returns
You can apply for an EIN online or by faxing or mailing in the EIN form
As long as you have your EIN, you’ll be able to open bank accounts in your business’s name.
Sales Tax License Michigan
If you sell goods to consumers in Michigan, you need a sales tax license. The goods must be something you deliver or hand to the consumer in order to collect taxes. Any digital goods or services are not taxed in the state of Michigan.
If you need a sales tax license, you’ll first need your federal EIN. It takes approximately 8-10 business days to receive your sales tax license.
Once you have your EIN, go here to complete the application for your sales tax license. You’ll need the following information:
- Business identifying information
- Business activity
- Business type (LLC)
Step 7: Open Business Bank Account
You should open a separate business bank account to keep your personal and business expenses separate. A business bank account helps you both personally and as a business owner. In order to build business credit, you’ll need a bank account in your name so that you can get business credit cards.
Using business credit cards helps your business build credit so that you can take out larger loans down the road, should you want to expand or need an operating loan.
Each bank has different requirements, fees, and steps you must take. Check with several banks to make sure you get the best interest rates on your accounts. At the very least, you’ll need your federal EIN, Articles of Incorporation, and your business license.
The top banks in Michigan include:
- First National Bank of Michigan
- Michigan First Credit Union
- Lake Michigan Credit Union
- Huntington National Bank
- Chase Bank
Small Business Funding Options For Michigan LLC
Funding your small business can be a struggle. Without funds, it’s hard to get up and running or even stay running. Just like you can borrow money for personal reasons, you can get loans for business purposes too. You’ll need to provide plenty of paperwork on your business’s finances. You must also be able to prove that you have some equity in the business (at least 20%).
If you meet these requirements, you may find funding in one of the following areas:
- Bank loan – Try getting a loan from your local bank that you do business with now. Since you have a banking relationship with them, you may have an easier time getting approved. We also recommend that you get quotes from at least three other banks. This allows you to compare loan amounts, interest rates, and fees. Expect the process to take at least a few weeks.
- SBA loan – The Small Business Administration guarantees loans for banks, which can help if you are ‘risky.’ If you don’t have a long credit history or have little equity in your business, banks may not want to finance you. With the SBA guarantee, though, the bank is guaranteed a portion of the loan should you stop making payments. This guarantee makes banks more willing to provide the funds.
- Peer-to-peer lending – Online lending opens up many doors for business owners in need of money. Peer-to-peer lending is individuals or even businesses investing in your needs. You display your need and what criteria you have and you may find an individual or a group of individuals that will fund your loan. Just watch the terms and the fees on these types of loans.
Step 8: Keeping Your Michigan LLC Identity Private
If you want to keep your LLC separate from your personal identity, we recommend that you use a statutory agent or registered agent. The registered agent is a third party that is the contact person for your business for any communication with the state.
You Can Sign Up for a Registered Agent Service for you Michigan LLC Here.
The statutory agent receives documents including:
- Service process notices
- Secretary of State documents
- Tax forms
- Other government documents and notifications
A registered agent isn’t required if you have a physical location in the state of Michigan, but it’s a great way to keep your private information out of the eye of the public, giving you more privacy.
Benefits of Filing Your Michigan LLC Online
It can be a nerve racking experience to finally take the leap and start your business. Most people talk about starting a business, but very few actually take action and move forward to turn their dreams into a reality. Many will start the process and perform the Michigan Corporation search, and then give up as they find the process to be too tedious.
We have spoken with many business owners over the years and none of them have any regrets about giving their Michigan business a shot. While many small businesses often fail, it is better to give your idea a try rather then wonder “what if” for the rest of your life.
Benefits of starting your Michigan LLC
- Freedom– If your business were to work out, you would be able to achieve freedom from having to report to others and ultimately have the ability to control your own destiny. This is one of best benefits business owners have shared with us over the years. Having that ability to control your hours, family time, etc is something very few people can achieve.
- Unlimited Financial Upside– When you work for other people, there are many benefits such as good health insurance, retirement benefits, etc. However one of the biggest downsides is that you are often limited in the amount of income you can make. Most employers have budgets and despite how valuable you are to the company, the amount that they will pay you is often pre-negotiated in terms of a compensation plan or salary. When you work for yourself, your income potential is truly up to you. While it may take a while to build your business, you are ultimately in charge of your own compensation and how much you want to pay yourself. The term “Eat What You Kill” is often thrown around as one of the benefits business owners share.
- Following Your Passion- For some people starting a michigan business is not all about the money. For instance some people leave the corporate world to start a flower shop, bakery or restaurant because they are passionate and have skills in these areas. There is great joy one can achieve when pursuing something they believe in despite making less then at a corporate job.
- Creating Jobs for Others-How cool is it to think about the possibility of not only following your passions, but also helping employ others through something you are passionate about? One of the most fulfilling aspects of starting your Michigan LLC is having the ability to create jobs and bring employment to others. Odds are you probably have had a bad boss somewhere during your career. When you own your own business and employ others, you are able to create your own company culture, benefit structure and more.
- You Can Be Creative-When you work in the rat race, you may often feel restricted to share ideas or try new things. When you are your own boss, you have the ability to pivot and change directions on ideas at a moments notice. There is something freeing about having the ability to paint your own canvas any way you would like. You don’t like the color of the paint in your office? No problem! You can change them any color you like.
How to Keep Your Michigan LLC on Track and Ensure Legal Compliance
Limited liability companies offer a form of business structure that offers incredible simplicity and protection of personal assets. While this may be the case, it is still necessary to take deliberate steps to protect your venture from possible dissolution. Once you are set up for operations, you can take a few simple steps to protect your business vision and future.
3 Steps for Protecting Your Michigan LLC Business Assets
Step 1- Separate Your Personal Bank Account from Your Business Account
The need to have dedicated credit and banking accounts for your business must not be underestimated. This is a crucial part of ensuring the protection of both your personal and business assets. In business law, “piercing your corporate veil” is when you mix your personal and business assets. This puts items like your car or home at risk in case your business gets into legal trouble.
Moreover, it is vital to master ways to work on your business credit. The idea is to have access to financing options such as credit cards in your business’s name and not in your name.
Fortunately, LLCs are perceived to be more credible than other business structures, which attracts business from lenders. As soon as your business credit looks good, you can benefit from higher lines of credit and, of course, better interest rates.
Step 2- Invest In Business Insurance
It is hard to make smart risks with the hopes of growing your business if you are always worried about incurring significant losses. This is where business insurance comes in. Here are essential policies to acquire for your LLC.
- General Liability Insurance
This is one of the most comprehensive coverage forms that can protect your business from various kinds of lawsuits.
- Professional Liability Insurance
If you provide professional services such as accounting, having professional liability insurance is a must. This will help to protect you from lawsuits allied with business errors or even malpractice.
- Workers’ Compensation Insurance
It is hard to operate a business without maintaining a team of workers. Having workers’ compensation insurance protects your employees and ensures they are duly compensated for work-related injuries, illnesses, or even fatalities. This, by extension, protects your business in case of an unforeseen incident. If your company has corporate officers, LLC members, or even just one employee, you are legally required to have this type of insurance coverage.
Step-3 Know How to Sign Legal Documents Correctly
The main benefit of setting up an LLC is for you to separate yourself and personal assets from those of your business. This makes it crucial to sign legal documents as a representative of your company and not as an individual.
For you to protect your personal assets, consider following this formula when signing documents on behalf of your LLC:
- Name of the business
- Your official signature
- Your name
- The position of authorization you hold within the company (Job Title)
How to Keep Your Business Legally Complaint and Avoid Automatic Dissolution
Like any other business type, your LLC must remain compliant with Michigan business laws. Incompliance can lead to fines or even automatic dissolution of a company. This may, in return, put you at a loss of your limited liability protection. Because most concerns arise from missing one or more state fillings, make sure you work with a competent registered agent service to help ensure that your filings are done correctly and on time.
Here are crucial things to do to ensure your Michigan LLC remains legally compliant
Step 1- Obtain a Business Permit/License
Local, state, and federal government regulations must be met for you to run a Michigan LLC. For instance, if you are operating a restaurant, it is common sense to get a health permit.
As expected, a small fee must be settled to obtain business permits and licenses for a Michigan LLC. The amount of cash that ought to be paid will depend on the type of permits you need.
Step 2- Ensure You Meet Local Tax Filing Requirements
The number of state tax forms you need to register for will again depend on the kind of business you run. Let’s go through some of the common tax forms.
- Sales Tax
When operating a business that involves the sale of physical products, you must register for a seller’s permit. This can be done online via the official Michigan website for the Department of Treasury. Upon successful Michigan business registration, you will receive a certificate that gives your business permission to collect sales tax on all taxable sales.
- Employer Taxes
Unless you run your company alone, you will have to settle employer taxes. If you have employees who assist in running your venture, you must register for:
- Unemployment Insurance Tax
- Withholding Tax
You can register for the Unemployment Insurance Tax via the State’s Unemployment Insurance Agency. To apply for Employee Withholding Tax, visit the official website of the State’s Department of Treasury.
Step 3- Comply With Federal Tax Filing Requirements
The state requires the majority of limited liability companies to yearly report their income to the internal revenue service (IRS). If you run a multi-member LLC, use the Partnership Return tax option, form 1065. On the other hand, single-member LLCs should use the Schedule C tax option, form 1040.
Steps 4- File Your Business Annual Statement
Limited liability companies operating in the state of Michigan are required to file their annual statements. You can do this online after paying a nonrefundable fee of $25 to the Department of Licensing and Regulatory Affairs. If you miss the filing deadline, you will be charged a late fee of $50.
- Is my LLC name available?
It remains imperative to have an LLC name that is unique. Doing a Michigan business search can protect you from possible lawsuits and ensure that you don’t take up the name of an existing business. The easiest way to determine whether your preferred LLC name is available is by a free state of Michigan LLC search on the Michigan SOS website.
- Do I need a tax lawyer or CPA for my LLC?
LLC businesses have numerous benefits, and one of the most significant ones is potential pass-through tax treatment. While it is not mandatory to retain a CPA or tax lawyer, such experts can be instrumental in ensuring you take full advantage of this perk.
- What if I want to dissolve my LLC?
If circumstances make it crucial for you to close your business, you must dissolve your LLC to arrest the risk of lawsuits and the accumulation of government fees. The three steps for dissolving an LLC in Michigan include:
- Follow the dissolution steps as outlined in your operating agreement.
- Close all tax accounts allied with your business.
- File articles of dissolution
Taking all of the above steps will help you properly file your business in the state of Michigan. As soon as you decide to go into business, conduct a Michigan biz lookup to start the process of securing your business’s name before someone else takes it. Once you register the name and file your Articles of Incorporation, you are well on your way to running a business in Michigan. We hope this article helps create your Michigan LLC and gets your business off the ground!
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