Taxes and Fees for Your Michigan LLC
Here’s a breakdown of the likely taxes and fees you’ll incur when you start and run an LLC in Michigan.
Michigan LLC Formation and Filing Fee
When you first form your LLC in Michigan, you will need to pay a fee of $50 (or $100 if expedited) to file your Articles of Organization.
Michigan Permits and Licenses
You will need to pay licensing and permit fees on a regular basis depending on the type of business you are operating and where you are located. These do vary from city to city and industry to industry. If you don’t want to do the legwork yourself, we provide a complete Business License Research Package that will tell you all the licenses and permits necessary for your new LLC. It includes:
- A comprehensive package of all licenses, permits and tax registrations required for your business
- The application forms to file with the appropriate licensing authorities
- Your customized Business License Research Package will be emailed to you within two days of your company being filed by the state
- Remember that operating your business without the required licenses can expose you to risks and fines from state and local governments
- Michigan LLC Formation and Filing Fee: A one-time fee of $50 when you first file your Articles of Organization.
- Michigan State Annual Report Fee: A yearly fee of $25 when you file your annual report.
- Michigan Permits and Licenses: Various fees for renewing your licensing and permit fees on a regular basis. These depend on the type of business you are operating and where you are located. They do vary from city to city and industry to industry.
Michigan State Sales/Use Tax
If you’re selling products or services in Michigan you may need to pay a state sales tax.
Michigan Other Taxes
You may need to pay other taxes and fees, depending on the type of business you run. Learn about other Michigan taxes.
Because your Michigan LLC income flows through to your personal tax return, you must pay self-employment tax (also known as FICA, Social Security or Medicare tax) on your earnings. This is typically at a rate of 15.3 percent. You will be able to deduct your business expenses from your income when working out how much self-employment tax you owe.
Note that if you are an LLC electing to be treated as an S Corp, you can reduce your self-employment tax. We have a handy S Corp tax calculator that will help you envision how much you could save.
Federal Income Tax
You will also need to pay regular federal income tax when you file your tax return every year. You can see the federal tax brackets here. Note that you will be able to apply your standard deduction, personal exemption and business expenses to this tax.
Ready to Start your Michigan LLC?
Incfile provides a cost-effective service to help you create your Michigan LLC. We guide you through the process and handle most of the administrative steps, such as filing the Articles of Organization on your behalf. Our basic package also provides a free Registered Agent service for the first year.