Starting a company
Twelve Steps to Form a Business Corporation in Michigan
Contact: Gary Witus (firstname.lastname@example.org)
This is a step-by-step do-it-yourself guide to forming a new business corporation in Michigan. You can follow the steps in this guide, or go to one of the online business incorporation services for startups. The online services charge base fees that range from $50 to $150, and provide additional services with additional fees. Online services may not perform all of the steps listed below.
Step 1: choose the business entity type
We recommend forming a traditional domestic for-profit corporation, a “C-Corp.” A Limited Liability Corporation (LLC) is an alternative type of business entity with some simplified registration, but with various restrictions and limitations regarding outside investment, and no defined allocation in the event of dissolution. We recommend forming a C-Corp.
Step 2: choose a name for the company
The name of the company must be unique, and must contain the words “Corporation,” “Company,” “Incorporated,” or “Limited.” Abbreviations for these words are also acceptable. Check for name availability.
Step 3: create folders to hold corporate records and documents
Have both a physical folder or notebook, and a cyber-folder. Put documentation of the following steps in it.
Step 4: obtain a Federal Employer Identification Number (FEIN)
The Federal Employer Identification Number (FEIN) is a tax ID assigned to you for your business. It is required to open a checking account and to facilitate other financial transactions. Obtain your FEIN.
Step 5: obtain an Unemployment Insurance Account (UIA) number
Get the Unemployment Insurance Account (UIA) online from the Michigan Department of Licensing and Regulatory Affairs. You must have this account prior to hiring employees. You will also need this number to file your quarterly tax reports. Register the company with the Michigan Unemployment Insurance Agency.
Step 6: register your business with the Michigan Department of Treasury
Michigan requires business enterprises to register, allowing you to make your tax payments.
Step 7: obtain a sales tax license
Some sales are not taxed; some sales are taxed. Regardless if you make taxable or nontaxable sales, it is best to have a sales tax license. It legitimizes your business. Also, this license allows you to make purchases for resale without paying sales tax to the vendor. Get your sales tax license from the Michigan Department of Treasury.
Step 8: file Articles of Incorporation
This is the essential step that “creates” the company as a legal entity. The Articles of Incorporation cannot be filed on-line. Complete the form and submit with check or money order by mail to:
Michigan Department of Licensing and Regulatory Affairs
Corporations, Securities & Commercial Licensing Bureau, Corporations Division
P.O. Box 30054
Lansing, MI 48909
Record the six digit file number for all future correspondence with LARA.
Step 9: obtain any additional registration numbers and permits as needed
Obtain a Data Universal Number System (DUNS) number. You will need all of the information listed below to obtain a DUNS number:
- Name of organization
- Organization address
- Name of the chief executive officer (CEO) or organization owner
- Legal structure of the organization (e.g., corporation, partnership, proprietorship)
- Year the organization started
- Primary type of business
- Total number of employees (full and part-time)
If you plan on applying for government funding, you should also find the NAICS codes for your area of business.
Some businesses need special permits or licenses. You can search what permits are required.
Step 10: open a checking account in the business’s name
Step 11: select legal counsel
If you are planning on licensing IP to others, licensing IP from others, securing IP, forming a joint venture, or entering into contracts, you will need legal representation. You do not need to retain an attorney, but you should meet with one.
Step 12: file annual reports and change notifications as needed
See michigan.gov for requirements.
See eRegistration to:
- Register a new business
- Report employees performing services in Michigan
- Report a change in the entity type of your existing business
- Report the acquisition of all or any part of the assets, organization, trade or business of an existing business with Michigan employment
See Michigan Treasury Online to:
- Manage and update business registration information
- File and pay sales, use and withholding taxes
- View correspondence sent from treasury, including sales tax licenses
See Michigan Web Account Manager (MiWAM) to:
- File your quarterly unemployment tax/wage report
- Pay your unemployment taxes/reimbursements
- Respond to unemployment correspondence
For additional information, see http://www.michiganbusiness.org/start-up/business-assistance/.