There's no need to say that an LLC is one of the most popular business structures. It protects the owner on all levels of business life, both tax and legal.
Just like in any other state, Michigan encourages entrepreneurs to start their businesses in the state, offering various incentives and perks. What's more, the state provides an MSF (Master of Science in Finance) program for foreign companies, which allows brands to scale profitably to their best advantage.
Whether you're a local or a foreign company, if you want to open an LLC in Michigan, you will need to study all the requirements to file Articles of Organization for LLCs. This is to do everything correctly and successfully open a limited liability organization. We'll try to cover the whole point in one article.
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In brief, Articles of Organization (also hereafter “your Articles” or "the Certificate") are part of formal legal registration documents that are filed obligatorily with the State Secretary to create an LLC and to confirm its legal status at the state level. In turn, as a business structure, LLCs are often chosen by startups, small, and medium-sized businesses. All because this entity type combines the best parts of corporations, sole proprietorships, and partnerships into a single hybrid. Namely, with LLC, you will have the following advantages:
In addition, registration fees for LLCs are rather cheap. So, to file the Certificate in Michigan and open a firm, you will need to pay a fixed fee. Moreover, business formation services like Incfile will charge you $0 for their cheapest package, i.e. the process of filing the Certificate will cost you nothing. Consequently, in the case of Michigan, you will only need to pay a $50 state fee.
In the U.S., to legally run a business, you can't avoid the procedure of filing the Certificate. This is due to the fact that your LLC has its own legal identity. By having the articles approved by the state, you will be able to officially confirm that your company works legally, and state agencies are aware of its existence, its name, and current contact information. In this document, you will also indicate the address where the state will be able to send lawsuits (if any) and legal notices involving your company.
To file the Certificate, you will first need to fill it out properly by providing the following information:
Under Michigan law, not only the future owner but also any other authorized person who is not necessarily a member of the business can file the Certificate of Formation forms for a limited liability company.
The filing procedure is not complicated, meaning that business owners can handle the task on their own. However, when businesses wish to avoid all the routines associated with the paperwork, as well as any mistakes and wasted time, they often hire special LLC formation services that are able to do everything in a professional manner.
In addition to collecting information required to include in the Certificate and its filing, business formation services can offer solutions like legal and tax advice, company name and trademark reservation, obtaining EIN, and more.
Cooperation with such agencies, of course, has its own price. However, it's also a guarantee that all your registration documents will be filed correctly and on time. This means that your Articles of Organization will surely be approved by the Secretary of State. Nevertheless, if you're planning to hire an agency, we recommend that you first do your research to study its reputation, features, and services.
Every section in the Certificate must be filled out according to state rules and regulations, otherwise, the Secretary of State may reject your application and suggest that you correct any inappropriate information. Thus, you will have to do everything all over again.
The most common reasons for being rejected by the Secretary of State in any state are as follows:
There are two ways to avoid rejection. As mentioned earlier, the first one is to ask for help from special services. The second one is to download the Michigan blank form in PDF online and study everything in detail to properly fill in each of the required fields later.
Consulting with a professional attorney or accountant for compliance before sending out the forms to the Secretary of State is also a good idea.
The Certificate reflects the activities of the company and, thus, has to be up to date throughout the existence of the business. Therefore, when there are any significant changes in the activities of the firm, the Certificate must be amended. This can be done by filing a Certificate of Amendment and paying a $25 filing fee. By not doing so, you can get yourself in a number of legal and tax troubles with the state.
For example, your hired registered agent has to take all of the company's correspondence and do quite a few things to keep you up to date on all legal issues that involve your company with the state authorities. Changing your registered agent in Michigan without notifying the state in the process will lead to missing important documents or claims, which, in its turn, will lead to legal violations.
For example, when you need to change your RA, you must submit a Certificate of Change of Registered Office/Agent (Form CSCL/CD-520) to the Secretary of State. You can always visit Michigan.gov for more detailed information.
Other reasons to file change information are as follows:
You can file a Certificate of Amendment with the Secretary of State on your own without the help of an attorney. However, we'd still recommend consulting one in advance to make sure that the forms are filled out correctly.
In Michigan, standard review and filing procedures can take up to several weeks. However, everything can be done much faster. Thus, you can get your documents reviewed in just one hour if you pay an extra fee for expedited review and filing. According to the Secretary of State's website, "expedited review and filing, if fileable, is available for all documents for-profit corporations, limited liability companies, limited partnerships, and nonprofit corporations." That said, if you want your Certificate of Amendment to be validated in one hour, you should be able to pay an extra fee of $1000. However, there are other more affordable options too, e.g. 2-hour ($500) or 24-hour ($50) processing services. Once approved, the document will be sent to your registered office address.
According to state law, filing Articles of Organization in Michigan is done at the Department of Licensing and Regulatory Affairs (DLRA) along with filing the Application for Reservation of Name and attaching a receipt for a one-time non-refundable registration fee of $25. You can file the form online at the Secretary of State's website or by mail.
Veterans who have served in the U.S. Armed Forces are exempt from paying registration fees as well as those associated with filing an annual report. According to Michigan.gov, "veterans (as defined in MCL 35.61) may qualify for a waiver of fees for for-profit corporations, limited liability companies, and nonprofit corporations. Fees may be waived for all documents. Documents include annual statements (LLCs) and annual reports and annual statements (PLLCs), but on PLLC annual reports and statements the waiver is only for the $75.00 filing fee and is not applicable to the $50.00 late filing penalty fee."
Reservists who have been discharged/released, if not dishonorably discharged, also receive this benefit.An individual needs only to show evidence of military discharge or evidence of the veteran status and proof that "a majority of the membership interests in the domestic or foreign LLC responsible for paying the fee are held by veterans."
As mentioned earlier, to draft your Articles of Organization, you need to first carefully study all the Articles represented in the form to be filled out and determine what information is required. This will greatly reduce the risk of possible errors, increase the chance of filing the Certificate the first time, and consequently get a positive result.You can submit the form by mail or online. To apply by mail, you will need to download the form in PDF and send it to the Secretary of State once you fill it out. You can find the address for applications by mail in the "Contact Us" section.
Filling out the forms has to be done according to the requirements, i.e. you need to comply with the step-by-step instructions to avoid litigation or other legal complications. Therefore, if you are not sure about any aspects, we recommend asking for help from professional lawyers or hiring a business formation service to not only do everything correctly but also save your time.
Initially, you should check if your chosen LLC name is available, i.e. not taken by any other business in Michigan. The name must also not violate any rights of another business operating in the state. Even the slightest similarity can be a reason for the Secretary of State to reject your Articles of Organization. Consequently, you will lose your time and will have to submit again.
You can preliminary check your LLC name availability on the Licensing and Regulatory Affairs (LARA) website. Reserve your chosen name for $25 (for the period of 6 months) here. Upon expiration date, your LLC name may also be reserved again. For this, you will have to file another application and pay a fee.
For applications by mail, download and fill out this form.
Other requirements associated with an LLC name change include:
To reserve a name by mail and pay for its reservation, use the following address:
Michigan Department of Licensing and Regulatory Affairs
Corporations, Securities & Commercial Licensing Bureau
P.O. Box 30054
Lansing, MI 48909.
Name reservations can also be submitted in person at:
2407 N Grand River Ave
Lansing, MI 48906
Telephone: (517) 241-6470
Consultations for all reservations are available by phone (517-241-6470).
This is where you are supposed to indicate if you plan to engage in any specific business activity, e.g. accounting services or law practice. However, you can insert this phrase: "The purpose for which this Limited Liability Company shall be organized is for any and all lawful purposes for which a Limited Liability Company may be organized as per the laws of the state of Michigan." In this case, your LLC will be considered an all-purpose clause. In most cases, this is the way to go because that's when the LLC has more options and, therefore, becomes more flexible. Michigan allows LLCs and corporations to use an all-purpose clause.As your business grows, your company goals can change. The same goes for any changes in the name, LLC purpose, or its management structure. To remain in good standing with the state, you will have to file a Certificate of Amendment (Form CSCL/CD-715) with the Bureau. You can read more about the changes here.
This is another section that can be filled out or left blank. Often, the latter option is used, which indicates the indefinite validity of the company, i.e. the "perpetual" duration. Most states allow you to skip this part, however, you should know that usually, such limits are several decades in length. In case you want your LLC out of business on a specific date, you should indicate the appropriate date in the field. Otherwise, the duration will be assumed "perpetual" by default.
Although, is it really worth it if you can file a Certificate of Dissolution at any time?
By Michigan law, every business must have a registered agent. LLCs are no exception. Registered agent information is to be included in the Articles of Organization so that the individual or entity can subsequently receive legal and tax documents from the state.
The main requirements for an RA are to be of legal age (over 18) and have a physical office in the state, be available during normal business hours, and ensure confidentiality for the business.
You do not need to be licensed or trained in any way to become your own statutory agent, which allows you to virtually hire anyone for the position. Therefore, it can be your trusted person (a family member or a friend), a business formation company, your attorney, or yourself.
For a number of reasons, it's preferable to use third-party commercial services that know how to handle all the paperwork properly and are often able to help with other business-related procedures. That said, professional RA agencies will offer you much more than just being available in the office and accepting notifications from the Secretary of State.
For example, some service providers offer consulting services and professional attorneys for hire, who are also willing to help you fill out the forms and file with the state, remind you of deadlines for filing annual reports, and more.
In the form, you will need to fill in the primary street location of your registered office and your mailing address (if different from the primary address).
This item will not be relevant for all types of businesses. But if you're planning to start a construction business, a lawyer's business, or a business with children in medicine, then you'll need to apply to the state for a special business license and permit. If you're not sure whether you need such documents, we recommend checking with the Business License Search page.
The needs in this area will also depend on the city in which you plan to open your company offices. Therefore, it's also worth checking with the local government to clarify all the intricacies.
These fields don't have to be filled out. The first Article indicates when your LLC or PLLC appears on the market - immediately after the Secretary of State approves your Articles of Organization or somewhat later (no more than 90 days after the Secretary approves the Certificate).
Thus, fill in the field with the effective date only if you plan to launch the agency later in the future. If on the day of approval, the field can be skipped.
As for additional provisions, if the agency will be managed by a manager or more than one member, you want to consult with an attorney.
An organizer is not necessarily a member of the LLC. This can be an accountant, attorney, registered agent, family member, friend, or the LLC owner. In other words, it's the person who files for you.
When you've completed your Michigan Articles of Organization research and have studied all the Articles in the forms, it's time to file the Certificate with the Secretary of State. You can do that online at the official website, in person, or by mail - whichever is most convenient for you.
Keep in mind that the reviewing and approval process will go much faster online because there's no shipping. The standard document review by mail is done within 10-14 days. However, if there is a need to get your results sooner, you can pay an additional fee ($50) for expedited review and get your results from the Secretary of State within 24 hours.
The state filing fee is $50, and you can pay it online via your credit card. Once you have the receipt, attach it to the set of documents, and mail it to the appropriate address (shown above).
On the Secretary of State's website, fill out the form online, have the organizer sign it, pay the fee, and confirm your submission. This is the easiest way to submit the Certificate and it only takes around 30 minutes to complete.
You will be able to track the status of your application on the website, and as soon as the result appears, it will be sent to your indicated email address. You will receive your signed and approved documents with a CID and pin code.
|Address||2407 N. Grand River Ave. Lansing MI, 48906.|
30054, Lansing, MI 48909
|Working schedule||Mon-Fri 8:00 am to 5:00 pm|
To get your certified copy of a Certificate of Good Standing for your LLC, you need to submit a Certification and Copies Request. Such a copy will only cost you $10. Once your request is sent and reviewed, you will receive it within 3 days.
Also, the procedure can be carried out in other ways - in person at the office or by mail. The first option will, however, require the applicant to pay an additional $2.5 to get the result the same day. Whereas the second option will require more time due to the delivery aspect.
To order your copy by mail, fill out this form, and for personal delivery, visit the Division of Corporations at 2501 Woodlake Circle, Okemos, MI 48864.
In Michigan, a Certificate of Good Standing is required to show that your LLC is operating legally and is compliant with state regulations. That said, such a document is, without a doubt, a must-have for any LLC.
Want to know the requirements for articles of organization in other states? Select state:
It's time to take care of other things that you will definitely need to manage and grow your business. For example, an operating agreement (hereinafter OA) must be drawn up and signed by all members of the LLC.
In Michigan, such a document is not obligatory, i.e. the state does not require such an agreement to form an LLC. However, it can save you from a number of issues associated with disputes among all members of the company in the future.
An OA is nothing like the Articles of Organization. The former usually has prescribed detailed company management rules and regulations to follow, as well as actions to follow in unforeseen situations and events, cash and property contributions, profit shares, various procedures for admission of new members, meetings schedules, and so on.
Of course, an operating agreement can be verbal, however, in such a case, it cannot be certified by a lawyer.
Consequently, all disputes that may arise among members of the LLC in the future may have a significant negative impact. Therefore, to provide stable business growth, it's highly recommended to draft it competently together with a professional lawyer, review it every year, and make timely changes.
If you have filed a Certificate of Amendment stating that your single-member LLC will now have employees or more members, you will need to obtain an EIN by filing Form SS-4, Application for Employer Identification Number, with the IRS. However, this document will not be superfluous in any case, and the online application process only takes about 5 minutes.
Once you have your EIN, you will be able to:
You will also need to:
As we see, the preparation of Articles of Organization in Michigan is not as complicated as it may initially seem. The main rule is to comply with all the requirements and avoid mistakes, which is quite easy if you familiarize yourself with the forms in advance and collect all the required information.
For those of you who don't want to do all the routine, you can use the services of a professional registered agent at business formation services or entrust the task to a professional you can trust to be an organizer for your LLC.
If everything is done correctly, you are supposed to get your results within two weeks or so (on average).
Hopefully, this article will help you quickly get started and grow your business successfully.