Incorporating Your Business in Michigan
Incorporating your business in Michigan can be daunting. Here at Michigan Registered Agents we are committed to making business formation easy. On this page, we provide everything you’ll need to know to set up your Michigan corporation. First, we outline the benefits of incorporating in the Great Lakes State. Then, we provide a step-by-step guide on how to incorporate your business as well as what steps you’ll need to take after formation to keep things running smoothly. Over the years we’ve formed hundreds of businesses for people and know what some of the typical questions are, so we made an FAQ to cover some of the most common inquiries we receive when forming Michigan corporations.
Benefits of Starting a Michigan Corporation
Location, location, location. When it comes to incorporating your business, Michigan is a great location with opportunities in a variety of sectors. With low taxes, a low cost of living, and a strong central US location with access to highways, rail, and inland seaports, the Great Lakes State is a location primed for success. Business opportunities are diverse. Detroit is home to three major automobile manufacturers and a ton of record labels while Lansing is a leader in higher education. At the same time, tourism in both the lower and upper peninsulas is a billion dollar industry. In short, if you can dream up a business idea, Michigan is the place to make it happen. Whether you’re catering to the UP tourists, setting up shop in the Motor City, or running a business along our 3,200 miles of coastline, you’ll discover that Michigan is pure opportunity.
Many Michigan business owners specifically decide to form corporations for a few reasons:
- Corporations allow for a lot of tax deductions. While this may be beneficial for your business, it’s important to keep in mind that it is also possible for an LLC to be taxed as a corporation. You also have the option to elect a different tax structure for your corporation. And even though they might not be as robust as their corporate counterparts, LLCs can also submit deductions.
- Investment. Corporations attract investors because it is easy to buy into the business as a shareholder. If part of the plan for your company includes bringing on investors, incorporating in Michigan may be your best option.
- Corporations allow for continuity. If your business is going to be your legacy, you should consider forming a corporation. An incorporated business is not tied to any one person like a sole proprietorship, or a dedicated group of individuals like an LLC. A corporation anticipates that time will pass and people will come and go from the business as it continues to grow. When you decide to form a corporation, you’re doing more than starting a business; you’re creating a future.
How To Start a Michigan Corporation
In order to incorporate your business in Michigan, you will need to file Articles of Incorporation with the Department of Licensing and Regulatory Affairs (LARA) and pay the $60 (minimum) filing/processing fee. But let’s get one thing straight right off the bat: forming a corporation and actually creating a functioning business are two different things. Here at Michigan Registered Agent we deal with making sure our clients have actual functioning businesses. While all you technically need to do to have a corporation is choose a registered agent, business name, and file Articles of Incorporation, we’d rather you hit the ground running, so make sure you read this webpage top to bottom. We do a lot more than fill out paperwork. We specialize in forming fully-functioning businesses for our clients.
Appoint a Registered Agent
First things first: you need to appoint a registered agent. In Michigan, a registered agent is sometimes called a resident agent. Resident or registered, these agents do the same thing: accept legal documents on your company’s behalf. While the letter of the law says a registered agent only has to have a physical address and be available during regular business hours, you and your business deserve more. You want someone you can trust. Someone reliable who protects your privacy and makes your documents easily available through a secure online portal. Someone like us.
Name Your Corporation
Picking a name for your corporation is a big decision. First, you’ll need to make sure the name is not being used (or reserved) by any other business entity in Michigan. You can search the Department of Licensing and Regulatory Affairs (LARA) database to check a name’s availability. It’s also a good idea check their list of restricted words before deciding on a name.
Submit Michigan Articles of Incorporation
The Articles of Incorporation is the official document you use to establish your business with LARA. A lawyer will try to convince you that it’s a complicated web of legalese and you should fork over a thousand bucks so they can take care of it. The reality is that you are more than capable of doing the paperwork. It’s not overly-complicated; however, it also helps to know what you’re doing. As Michigan-based registered agents, we’re experts at navigating the system. We think a fair price to do the work correctly and quickly is $100, which is part of our corporation formation package. Still, if you’d like to save the money and don’t mind taking the time to fill out the form, here is what you’ll need to include in your articles:
Provide the name you’ve chosen for your corporation. The name will need to include the word Corporation, Company, Incorporated, Limited, or some abbreviation of one of these words.
State the purpose of your business. This doesn’t need to be detailed. A simple one-sentence explanation will do.
List the number of initial shares for the corporation. Specifically, you’ll need to determine how many common and preferred shares there will be, as well as the rights and limitations of each type of share. Keep in mind that any number of shares exceeding 60,000 incurs additional fees when you file the Articles of Incorporation.
Registered Agent Information
Provide your registered agent’s information. You’ll need to provide the name, address, and contact information of your agent. Even if you’re forming the corporation on your own, we are still more than happy to be your registered agent.
Names and Address of Incorporators
List the names and addresses of your incorporators. Truth be told, this is where a lot of our clients stop filling out the Articles of Incorporation themselves and give us a call. Whatever names and addresses you list in this section will become public record, available to every solicitor and every curious ne’er-do-well in the great state of Michigan and beyond. When you hire us to form your corporation, we list our name and address, protecting your privacy and shielding you from unnecessary nonsense that comes with having your name plastered all over the public record.
Articles VI and VII (optional)
Read over the boilerplate language provided by LARA in these sections to decide if you want to keep, delete, or amend these provisions.
Now that your Articles of Incorporation are complete, make sure you and anyone else who needs to, signs the form and provides the correct contact information.
To file your articles, you have three options: by mail, in-person, or online.
Michigan Department of Licensing and Regulatory Affairs
Corporations Securities & Commercial Licensing Bureau
P.O. Box 30054
Lansing, MI 48909
Michigan Department of Licensing and Regulatory Affairs
2407 N Grand River Ave.
Lansing, MI 48906
LARA Corporations Online Filing System
What To Do After Forming a Michigan Corporation
You’ve officially incorporated in Michigan. Awesome. Remember how we said there’s more to forming a fully-functional business than filing the paperwork? You’ll want to hold off celebrating until you take care of these few final and really important details.
Get an EIN
A federal employer identification number (commonly called an EIN or FEIN) is unique to your business, like a social security number. Required and issued by the IRS, the EIN is crucial to managing your corporation’s finances. You’ll need an EIN to file your taxes, to open a business bank account, apply for local permits, or secure a business loan. You can either secure an EIN yourself through the IRS or you can hire us to take care of it for you.
File Your BOI Report
As of January 1, 2024, most corporations are required to file Beneficial Ownership Information Report (BOI) with the Financial Crimes Enforcement Network (FinCEN). Filing the BOI is free. Although some corporations are exempt, most corporations are not. A beneficial owner is someone with a large stake in your company. Beneficial owners can be officers, board members, or anyone with at least 25% ownership stock. In addition to your company’s name (including DBAs), tax ID, and jurisdiction of formation, your BOI must include the following information for each beneficial owner:
- Full legal name
- Date of birth
- Residential address
- Copy of an accepted form of ID (like passport, tribal-issued ID, or driver’s license)
If the person who filed the formation documents is different than the beneficial owner, their name and information will also need to be included in the BOI report as a company applicant. Most newly formed businesses will have 30 days to file their report. However, companies formed during 2024 have 90 days to file, and companies formed anytime before 2024 have until January 1, 2025.
Don’t want to spend time figuring it all out on your own? For just $9 you can hire us to file your company’s BOI report for you.
Open a Business Bank Account
Although not required, it is important to open a business bank account for your corporation. Opening a business bank account protects your personal assets by keeping your business’s finances separated from your own. Keeping track of write-offs, payments, and keeping your records organized is made significantly easier by having a business bank account. When you visit the bank to set up your account, make sure you go prepared. Have your certificate of authority, EIN, and a copy of your corporation’s bylaws in hand.
Benefits of Hiring Us to Incorporate Your Michigan Business
Here are just a few of the benefits of incorporating using our services:
• We list our address on the Michigan articles as the principal and mailing address.
• We accept state and legal mail on your company’s behalf
• We scan business mail into your secure client portal within 24 hours
• We accept service of process and notify you immediately
• We include one year of our Michigan Registered Agent Service
Michigan Corporation FAQs
How much does it cost to form a Michigan Corporation?
The short answer is that it costs $60 to file your Articles of Incorporation with LARA: $50 for the articles plus a $10 fee for LARA to process them. The more complete answer is that sixty bucks will get your articles processed in about 10 business days. You can pay extra for expedited processing. LARA also offers same-day service for $100, two-hour service (submitted by 3 p.m. EST) for $500, and one-hour service (submitted by 4 p.m. EST) for $1,000.
One last cost to keep in mind are the fees associated with having more than 60,000 initial shares. LARA has a graduated fee schedule for any initial number of shares over 60,000. The breakdown is:
Number of Authorized Shares
$500 for the first 10,000,000 + $1,000 for additional 10,000,000 (or a portion thereof)
How long does it take to process the Articles of Formation?
The standard turnaround time for Articles of Formation from LARA is 10 business days, or about 2 weeks. If you’re submitting the forms via mail, you’ll need to add on a couple days for the post office. Fortunately, LARA also offers same-day service for $100, two-hour service (submitted by 3 p.m. EST) for $500, and one-hour service (submitted by 4 p.m. EST) for $1,000.
When do I need to file my annual statement?
Annual statements for Michigan corporations are due by May 15 and cost $25 to file. Failure to file on time incurs a $10 per month penalty. If you do not file for two consecutive years, your business will be dissolved by LARA and your business’s name will be up for grabs. When you use our corporation formation service, we will send you reminders to file your annual report.
Does my corporation need an assumed name (DBA)?
Your corporation doesn’t need a DBA, but it can be a good idea. A lot of Michigan corporations operate under assumed names (commonly called DBAs) because an assumed name allows for branding and franchising opportunities. You can quickly and easily add a DBA using our Trade Name Service for $125 plus state fees after purchasing our corporation formation package.