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Swyft Filings is committed to providing accurate, reliable information to help you make informed decisions for your business. That's why our content is written and edited by professional editors, writers, and subject matter experts. Learn more about how Swyft Filings works, our editorial team and standards, what our customers think of us, and more on our trust page.
You’ve started a new business in Michigan and are ready to serve customers. Before you open your doors, ensure your limited liability company complies with licensing requirements. You will probably need at least one business license to remain in good standing as a business owner.
Michigan Business License: Key Takeaways
Michigan does not require a general business license for small businesses; however, many cities in Michigan may require a business license depending on your location and business type.
While no general federal or state license is required to operate a business in Michigan, certain industries are federally regulated, and specific state licenses or permits may be needed.
Entrepreneurs should check with local city and county governments for additional licenses and permits beyond federal and state requirements. Additionally, specialized professions in Michigan, such as healthcare and cosmetology, may require professional licenses.
Ensuring you have the right business licenses and permits is crucial. Let us manage the complexities for you, so you can stay focused on what you do best — running your business.
What Is a Business License?
A business license permits a small business owner to start and run a company. The license indicates that a business has official government approval to operate. A business license is not the same as registering your company. You get a license once you’ve set up your company with the state of Michigan.
Obtaining business licenses for your limited liability company is essential, as government agencies will fine and close businesses operating without required licenses. Registering your DBA, for instance, is a form of licensing. The Federal government and the state of Michigan don’t require a general federal or state license to operate lawfully. Still, you will likely need at least one specific kind of business license.
Many Michigan cities require a business license. Detroit, for instance, requires a permit to do business in the city. Business license requirements vary according to the operational rules of the city. Whether you need a business license depends on several factors, including your business type and where your company is based.
Though getting a business license might seem like just more paperwork, there are various benefits to obtaining one for your company.
Gain a positive reputation in the local community
Establish trust and transparency with customers
Fulfill vendor and landlord requirements
Gain access to funding
Protect your intellectual property
Comply with tax requirements
Enhance limited liability protection
You may also hear about required permits. Business licenses permit you to operate, while permits are official documents issued to ensure your company abides by safety regulations.
Get Your Michigan Business License in 7 Steps
It might seem overwhelming, but it’s essential to understand the entire business license process. Follow these steps to discover if you need a state license or additional licenses, such as an occupational tax certificate. The following will help you determine what licenses and permits you need to run your business.
Step 1: Apply for Michigan General Business Licenses
Michigan does not require a general business license for a small business. Even though a state license isn’t needed, most cities demand that you get a business license or a professional license for specific industries. Whether you need a license will depend on where you are located and your type of business.
Step 2: Apply for Federal Licenses for Michigan Businesses
There isn’t a general federal business license for Michigan companies, but specific industries are federally regulated. In such cases, you will require federal licensing for your new business.
According to the Small Business Administration (SBO), you will require a federal license or permit if a federal agency regulates your business activities. The requirements and fees for those additional licenses can be found by consulting with the appropriate agency.[1]
Businesses regulated by the federal government include agricultural companies that import or transport animals and plants across state lines. Such companies are governed and regulated by the Department of Agriculture. If you are a business owner of a company operating a radio or TV station, you require licensing via the Federal Communications Commission. Companies in aviation need licensing from the Federal Aviation Administration.
Step 3: Search for Michigan Permits and Licenses
While Michigan doesn’t require a general permit, a host of state license permits are required. What additional licenses you will need will depend on your type of business.
You can determine if your business requires a specific license by consulting the state’s database of industries generally requiring a particular state license.[2] For example, a search will show that a food service license is required if you are running a restaurant. For that same establishment, you will require an alcohol license if you serve alcoholic beverages.
Other examples of required licenses include if you own a nail salon. If you do, you must have a professional license in cosmetology from the Department of Licensing and Regulatory Affairs.[3]
If you are running a pest control company, you must be licensed by the Department of Agriculture & Rural Development, Pesticide and Plant Pest Management Division. In another case, running a hot dog stand requires a Mobile Food Service License from the Department of Agriculture & Rural Development.
Additionally, any company that sells products to the public requires a Michigan sales tax license from the Michigan Department of Treasury.[4] This is all in addition to specific permits that allow for doing business, such as if you are renovating your office, you may need a building permit.
Step 4: Search for Local County or City Michigan Business Licenses
Certain Michigan cities and municipalities require specific licenses and permits that go beyond federal and state requirements. These licenses and permits are often tied into city ordinances.
For example, in the city of Wyoming, while all businesses must apply for a business license, certain companies not based in the city doing business there must also apply. These include snowplow operators and rubbish haulers. Additionally, certain companies have addendums that must be included with the business license application, like dance halls and gas stations.[5]
Lansing, Michigan, has a variety of businesses that require licenses. These include auctioneers, health clubs, and street musicians.[6] The city of Detroit has many business types requiring licenses, including nightclubs, pet shops, and jewelry stores.[7] Depending on your business type, you will require specific supporting documents. For instance, a nightclub requires a building permit and liquor license.
Check with your city clerk’s office in your township regarding additional licenses and permits. You can check for your local township contact information on the Michigan Townships Association website.[8]
Some counties have separate licensing requirements, so it’s a good idea to check the rules in your county. For contact information for your County Clerk, consult the Michigan Association of County Clerks website.[9]
Depending on your business, you may also require a professional license (see below). And if products are sold, you’ll need a sales tax permit and a business tax certificate.
Step 5: Search for Michigan Professional Licenses
If you work in a specialized profession, you may require a professional license and a state and local business license. A professional license is a state license that permits you to work in a particular profession in your state. This additional licensing is to protect the safety and well-being of Michigan citizens.
Professions requiring a professional license in healthcare include acupuncture, dentistry, and psychology, while occupations requiring an occupational professional license include accountants, architects, cosmetologists, engineers, and real estate brokers and salespersons.
Plumbers are required to get additional licenses, including undergoing an apprentice program.
Step 6: Apply for a Michigan Home-Based Business License
With a home-based business, your home occupation is subject to the same laws and regulations as other businesses. These rules include zoning regulations for your business location and specific permits based on your type of business. You must also register your home business with your County Clerk’s office or incorporate through the Department of Licensing and Regulatory Affairs.[10]
Home-based businesses requiring a business license include childcare and family-child learning. If clients visit your home, you will need special licensing. This is the case in the City of Grand Rapids.[11]
It’s essential to research and check with your local County Clerk’s office before opening a new business in your home. Not every home-based small business requires licensing and permitting. For instance, if you run a cottage food business making foods that don’t require temperature control, you are exempt from obtaining a food license or food establishment license.[12]
Step 7: Maintain Your Michigan Business License
To ensure your business remains compliant, you must maintain your State of Michigan business license(s). As a business owner, you must track when licenses are up for renewal. Paying the annual renewal fee on time is essential, or you will face stiff penalties.
The cost of business licenses in Michigan varies. For example, a business license in Wyoming, Michigan costs $50 per year unless you run a particular type of business, such as an auto body shop, which costs $125 per year, or a gas station for $150.[13] In Detroit, business license costs vary widely — from $100 for a delicatessen to $1,150 for retail fireworks.[14]
You may also need an occupational tax certificate and a business tax certificate. If keeping track of renewal times and fees is stressful, Swyft Filings can help make staying in good standing easier.
Apply for a Michigan Business License Online
At Swyft Filings, we know that keeping licensing straight for your small business can be time-consuming and confusing as a small business owner. Make life easier by having our experts obtain and maintain your business license and permits.
We keep track of your business license renewals, ensuring that all the paperwork gets done correctly and on time and that all necessary fees are paid. We’ll fill out your business license application for your new business, freeing you up to focus on running your business.
Focus on Your Business: Dive into your passion while we handle the intricacies of acquiring the necessary local, state, and federal business licenses and permits.
Simplify Your Paperwork: Complete our straightforward questionnaire, and we’ll handle all the required filings for you, accurately and promptly.
Stay Compliant: Avoid the risks and severe repercussions of non-compliance. We’re here to ensure your business remains in good standing.
FAQs
How do I get a business license in Michigan?
Check with your local City Clerk’s office to get a business license in Michigan. Also, check with the state to see if your profession requires special licensing.
Does Michigan require a general business license?
No, the State of Michigan does not require a general business license.
Can you sell things in Michigan without a license?
You may not sell tangible goods in Michigan without a sales tax license.
Do I need a special license for an online business in Michigan?
Any person selling tangible goods online in Michigan requires a sales tax license.
Can I collect sales tax in Michigan without a license?
No, you may not collect sales tax in Michigan without a sales tax license.
How much does a Michigan business license cost?
The cost of a Michigan business license varies depending on the type of business and geographic area. Prices range from $15 to more than $1,000.
What’s the penalty for not having a business license in Michigan?
Penalties for not having a business license depend on the type of license. If someone operates without a professional license, they risk a misdemeanor punishable by a fine of $5,000.00 to $25,000.00, imprisonment for up to a year, or both.[15]
Bibliography
Small Business Administration. “Federal Licenses and Permits.” Accessed June 15, 2023.
State of Michigan. “State License Search.” Accessed June 15, 2023.
State of Michigan. “Licensing and Regulatory Affairs.” Accessed June 15, 2023.
State of Michigan. “Who Needs a Sales Tax License?” Accessed June 15, 2023.
City of Wyoming, Michigan. “Business Licenses.” Accessed June 15, 2023.
City of Lansing, Michigan. “Business Licenses.” Accessed June 15, 2023.
City of Detroit, Michigan. “Business License Guides.” Accessed June 15, 2023.
Michigan Townships Association. “Find a Township.” Accessed June 15, 2023.
Michigan Association of County Clerks. “Association Contact.” Accessed June 15, 2023.
State of Michigan. “Home-Based Business Information.” Accessed June 15, 2023.
City of Grand Rapids, Michigan. “Apply for a Home Occupation Class B License.” Accessed June 15, 2023.
State of Michigan. “Michigan Cottage Foods Information.” Accessed June 15, 2023.
City of Wyoming, Michigan. “Fee Schedule.” Accessed June 15, 2023.
City of Detroit. “City of Detroit Business License Center Rate Report.” Accessed June 15, 2023.
Michigan Legislature. “Occupational Code (Excerpt).” Accessed June 15, 2023.
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