If you’re thinking about starting a business in Michigan, you may be wondering if you should form an LLC. Here’s a quick rundown of what you need to know about setting up an LLC in Michigan.
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Overview
Introduction
An LLC, or limited liability company, is a business structure that offers its owners personal liability protection with the flexibility of a partnership or sole proprietorship.3 min read
If you are doing business in Michigan, you may want to form an LLC. An LLC is a business structure that offers its owners personal liability protection with the flexibility of a partnership or sole proprietorship.
To form an LLC in Michigan, you will need to file Articles of Organization with the Michigan Department of Licensing and Regulatory Affairs (LARA). The Articles of Organization must include the following information:
-The name of your LLC
-The names and addresses of your LLC’s organizers
-The purpose of your LLC
-The address of your LLC’s principal office
-The name and address of your LLC’s registered agent
-The effective date of your LLC’s Articles of Organization
-Whether your LLC will be managed by members or managers
-If your LLC will be managed by managers, the names and addresses of those managers
You will also need to pay a filing fee when you submit your Articles of Organization. The filing fee is $50 for one member LLCs and $100 for multi-member LLCs.
The Basics of an LLC
In Michigan, an LLC is a business entity with limited liability. It is important to note that an LLC is not a corporation. Rather, it is a business structure that can provide limited liability for its owners in certain situations. While an LLC does have some features of both a corporation and a partnership, it is not quite the same as either one.
To form an LLC in Michigan, you must file certain documents with the Michigan Department of Licensing and Regulatory Affairs (LARA). These documents include the Articles of Organization for your LLC and the Operating Agreement for your LLC.
The first step in forming your LLC is to choose a name for your company. Your company name must comply with Michigan law and it must be available for use. You can check on the availability of your company name by searching the business records of the Michigan Department of Licensing and Regulatory Affairs.
Once you have chosen a name for your LLC, you must prepare and file the Articles of Organization with LARA. The Articles of Organization are very brief and they simply state that you are forming an LLC in Michigan and that you have chosen a name for your company. There is a filing fee for submitting the Articles of Organization, which is currently $50.
After you have filed the Articles of Organization, you must prepare and execute an Operating Agreement for your LLC. The Operating Agreement is a document that sets forth the rules and regulations governing the operation of your LLC. This document can be as simple or as complex as you like, but it must be signed by all of the members of your LLC.
Once you have filed the Articles of Organization and executed an Operating Agreement, your LLC will be considered formed in Michigan. You can then begin operating your business according to the terms set forth in your Operating Agreement.
How to Set Up an LLC in Michigan
You can form a limited liability company (LLC) in Michigan by filing Articles of Organization with the Michigan Department of Energy, Labor & Economic Growth.3 min read You can form a limited liability company (LLC) in Michigan by filing Articles of Organization with the Michigan Department of Energy, Labor & Economic Growth.3 min read
Choose a business name
When choosing a name for your LLC, you’ll want to make sure it’s available and compliant with Michigan law.
Your LLC name:
Can’t be the same as or too similar to an existing business name
Can’t contain certain restricted words (e.g., Bank, Attorney, University)
Must end with “Limited Liability Company,” “L.L.C.,” “LLC,” or “LC”
You can reserve your LLC name with the Michigan Department of Licensing and Regulatory Affairs for 120 days by filing the Name Reservation Request form. The filing fee is $25.
File the Articles of Organization
You’ll need to file the Articles of Organization with the Michigan Department of Licensing and Regulatory Affairs (LARA). The filing fee is $50, and you can do it online, by mail, or in person.
The Articles of Organization must include:
-The LLC’s name and address
-The name and address of the LLC’s registered agent
-The LLC’s purpose
-The names of the LLC’s organizers
-The effective date of the articles, if it’s not the date of filing
You can also choose to include additional information, such as the LLC’s duration or dissolution provisions. Once you’ve filed the Articles of Organization, your LLC is officially formed.
Appoint a registered agent
Appoint a registered agent. In Michigan, LLCs must appoint a registered agent—a person or business that agrees to receive service of process on behalf of the LLC. The registered agent may be either an individual resident of Michigan or a business entity authorized to transact business in Michigan. The LLC’s organizers must appoint the LLC’s registered agent by filing a Statement of Person Appointed as Registered Agent with the Michigan Department of Licensing and Regulatory Affairs (LARA).
Create an operating agreement
An LLC operating agreement is not required in Michigan, but we recommend having one. An LLC operating agreement is a legal document that outlines how the business will be operated and sets forth the rights and responsibilities of the members. This can help prevent future disputes between members. You can choose to create your own operating agreement or use a template. We provide a free LLC operating agreement template below.
Get an Employer Identification Number
You’ll need to get an Employer Identification Number (EIN) from the IRS. This is also known as a Federal Tax Identification Number, and it will be used to identify your business on all official documents. You can apply for an EIN online, by fax, or by mail.
Comply with other business regulations
In addition to naming your LLC and registering it with the state, you must also comply with other business regulations. For example, you will need to obtain a business license from the county in which your LLC is located. You may also need to get a sales tax permit if you plan on selling taxable products or services. Lastly, you will need to comply with any zoning regulations that apply to your business.
Conclusion
In Michigan, forming an LLC is a relatively simple process. You’ll need to file certain paperwork with the state and pay the required filing fees. Once your LLC is formed, you’ll need to comply with ongoing annual requirements, such as filing an annual report and paying annual taxes. Additionally, you’ll need to follow the rules for running your LLC, which include holding regular meetings and keeping minutes of those meetings.
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