The Complete Guide to Michigan Business Licenses
Michigan does not issue a general state business license. Most new Michigan businesses register with the Department of Treasury for taxes — the sales tax license is free — check local requirements with their city or township, and get a LARA license if their work is regulated.
Step 1: Form the LLC
File Articles of Organization with the Michigan Department of Licensing and Regulatory Affairs (LARA) for $50. Every LLC files a $25 annual statement by February 15; LLCs formed after September 30 skip the next February. See the Michigan LLC guide for every formation step.
Step 2: Register with the Department of Treasury
Register through Michigan Treasury Online (MTO) or with Form 518. Online registration is usually authenticated within 10–15 minutes; paper takes four to six weeks.
- Sales tax license: required for businesses that sell tangible goods to the final consumer. There is no fee, and the license is issued for each calendar year (valid January–December). Wholesalers generally do not need one. The sales tax rate is 6%.
- Withholding: needed before your first payroll; employers also register with the Unemployment Insurance Agency.
- City income tax: some cities, including Detroit, Grand Rapids and Lansing, levy their own income tax.
Step 3: City and township licenses
Many Michigan cities and townships require a local business license or registration for certain activities, plus zoning approval and a certificate of occupancy for commercial space. Detroit, for example, licenses many business types through its Business License Center. Check with your city or township clerk before opening.
Step 4: Professional and trade licenses (LARA)
LARA licenses residential builders, electricians, plumbers, mechanical contractors, cosmetologists, real estate professionals, accountants, health professions and many others. Alcohol sales are licensed by the Michigan Liquor Control Commission.
Assumed names (DBA)
An LLC that trades under a name other than its legal name files a Certificate of Assumed Name with LARA.
Checklist
| Registration | Agency | Cost |
|---|---|---|
| Articles of Organization | LARA | $50; $25 annual statement |
| Sales tax license | Department of Treasury (MTO) | Free, issued yearly |
| Local license and zoning | City or township | Set locally |
| Professional or trade license | LARA | Varies |
Frequently Asked Questions
Does Michigan require a business license?
Michigan has no general state business license. Retailers need a free sales tax license, regulated trades need a LARA license, and many cities and townships have local requirements.
How much is a Michigan sales tax license?
It is free. The Department of Treasury issues it for each calendar year, valid January through December.
Who needs a sales tax license in Michigan?
Businesses that sell tangible goods to the final consumer. Wholesalers and most contractors generally do not need one.
How much does it cost to form an LLC in Michigan?
The Articles of Organization cost $50, and the annual statement is $25, due every February 15.
Does a Michigan LLC need a business license?
Forming the LLC registers the company but is not a license to operate. The LLC still needs tax registration, any local license and any LARA license its work requires.