Form a Michigan LLC
Register your Michigan LLC with the experts at LawInc.com. At LawInc we are Michigan LLC formation specialists who can help you form a Michigan LLC properly. We file the Michigan LLC Articles of Organization with the Michigan Secretary of State Corporations Division and prepare a customized operating agreement. We can also obtain the Michigan LLC’s EIN, in an quickly as 24 hours. Let LawInc guide you through the process of forming your Michigan LLC.
Let LawInc walk you through the Michigan Limited Liability Company formation process. Our clear, concise and easy to use website, helps keep things simple.
Michigan LLC Name
The first step in forming a Michigan Limited Liability Company (LLC) is selecting the business name. Michigan LLC names:
- Must contain the words must contain the words “Limited Company” or “Limited Liability Company” or the abbreviation “L.C.” or “L.L.C.”
- The name of a Michigan LLC must be distinguishable on the records of the Michigan Sec. of State.
An available Michigan LLC name may be reserved for 120 days.
LawInc.com permits you to choose up to three names and will conduct a name search for your Michigan LLC, prior to filing.
Michigan LLC Formation
Michigan LLC Filing Procedure: When forming a Michigan LLC, the Michigan Articles of Organization must be filed with the Michigan Secretary of State. The Michigan Articles of Organization must state:
- The Michigan LLC name.
- Name and address of each Michigan LLC organizer.
- Street address of Michigan registered agent.
- Street address of principle place of business.
Michigan LLC Organizers: An Michigan limited liability company can be formed by one (1) or more organizers.
Michigan LLC Members: Michigan LLCs require 1 or more members. There is no residence or age requirement. Michigan LLC members are not required to be listed in the Articles of Organization.
Michigan LLC Duration: The period of duration of a limited liability company shall be perpetual unless the Michigan Articles of Organization place a limitation on the company’s existence or until dissolution or termination.
Michigan Registered Agent: An Michigan LLC must maintain a registered agent and office to receive service of process in Michigan. The Michigan registered agent should be available, at an Michigan physical address, during normal business hours to accept important legal and tax documents on behalf of the Michigan LLC. The registered agent can either be (1) a domestic entity or a foreign entity that is registered to do business in Michigan or (2) an individual resident of the state. A Michigan LLC may not act as its own agent.
Michigan LLC Operating Agreement: After filing, it is highly advised that an operating agreement is drafted which dictates the LLC internal affairs and management. There is no set criteria, but an Michigan LLC operating agreement should reference how the Michigan LLC is managed, allocation of profits and losses and member capital contributions. The Michigan LLC operating agreement does not need to be filed.
Michigan LLC Post-Filing Requirements
Michigan LLC Annual Report: Michigan LLCs must file an annual report which is due on February 15th, every year. This is typically April 15. The Michigan LLC annual reports cost $25.00. To file and pay online, visit http://www.michigan.gov.
Michigan LLC Taxes
Michigan State Income Tax: The LLC tax rate for Michigan is variable, depending on Michigan taxable net income.
Federal Income Tax: An advantage of the LLC is its tax flexibility. LLC members are allowed to select how the entity will be taxed. An LLC may be classified for federal income tax purposes as either a:
- Sole proprietorship
- Partnership, or
Single member LLCs are treated the same as sole proprietorships. Profits are reported on Schedule C as part of your individual 1040 tax return. Self-employment taxes on Michigan LLC net income must be paid just as you would with any self-employment business.
Most Michigan multi-member LLCs elect to be treated as partnerships by the IRS and file IRS Form 1065. On this form, Michigan LLC profits are reported and allocated to each of the owners according to the Michigan LLC’s operating agreement. Each owner is given a Schedule K-1, which shows each owner’s share of LLC income or loss. The owner then reports and pays taxes on this income on the owner’s annual 1040 income tax return. It is important to note that as with sole proprietorships, all Michigan LLC profits are taxed to the owners, even if they are not actually distributed by the LLC. This situation can arise when the LLC needs to use its profits to pay ongoing expenses.
If pass-through taxation is not desired, an LLC may elect to be taxed as a corporation by completing IRS Form 8832. If this election is made, the LLC is taxed as a C corporation by the federal government. Because the corporate income tax rates for the first $75,000 of corporate taxable income are lower than the individual income tax rates that apply to the taxable income of non-corporate taxpayers, it is possible a net income tax savings can result from this tax election. Additionally, an LLC can be taxed like an S corporation by filing IRS Form 2553.
Federal Tax Identification Number/Employer Identification Number (EIN): The Federal Tax Identification Number, also known as the Employer Identification Number (EIN) is a number that is assigned to a business by the Internal Revenue Service. An EIN is like a Social Security Number for a business. It is a requisite for certain business functions such as opening bank accounts or hiring employees. An EIN is typically required if the Michigan LLC has more than one owner, or any employees.
Michigan LLC Dissolution/Cancellation
Michigan LLC Dissolution/Cancellation: In order to dissolve or cancel an Michigan LLC, the members or managers must file a Certificate of Dissolution form with the Department Licensing and Regulatory Affairs (LARA). The LLC must be current and in active status prior to filing a Certificate of Dissolution. A Tax Clearance Certificate should be obtained prior to filing. For online filing, visit the Michigan.gov Business Center website.
Acts Triggering Michigan LLC Dissolution: A Michigan LLC can be dissolved upon the happening of one of the following:
- At a time specified in the Articles of Organization or operating agreement;
- Upon occurrence of events specified in the Articles of Organization or operating agreement;
- Consent by the specific number or percentage of members indicated in the operating agreement;
- At any time there are no members; or
- Judicial decree to dissolve by a Court.