How to Get Business Licenses in Michigan | A Comprehensive Guide

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Michigan Business License

Starting a new business is an exciting venture, but it’s essential to understand the various licenses required to operate legally within Michigan. Forming an LLC in Michigan requires licenses, as different industries and locations have specific regulations. This article will provide a comprehensive guide to Michigan Business Licenses, helping you navigate the process and ensure your new venture complies with all necessary requirements. By understanding the permitting landscape in Michigan, you can ensure that your business is fully prepared to succeed while avoiding potential legal pitfalls.

Webinarcare Editorial Team will help you easily obtain a business license in Michigan. You must be guided by all the factors gathered in this article.

What is a Business License in Michigan?

A business license is a legal authorization, permit, or document that allows a business to operate within a specific jurisdiction, such as a city, county, or state. Michigan business licenses are issued by Michigan Secretary of State and ensure businesses comply with applicable laws, regulations, and standards in their respective industries.

A business license protects public health, safety, and welfare by ensuring businesses operate responsibly and lawfully. Acquiring a business license often involves registering the business, paying applicable fees, and meeting specific requirements or qualifications for the type of business.

Business licenses can vary greatly depending on the location and nature of the business. Some common types of business licenses include:

1. General Business License: This is a basic license required for most businesses to operate within a specific jurisdiction, such as a city or county.

2. Professional and Occupational Licenses: These licenses are specific to certain industries or professions, such as healthcare, construction, real estate, or cosmetology, and are typically issued by state licensing boards or agencies.

You must have a professional and occupational license to form Michigan General Partnership and offer your service. 

Here are some examples of Professional and Occupational Licenses:

  • Medical License: Physicians, surgeons, and other healthcare professionals must obtain a medical license to practice medicine in a specific state. The Michigan medical board issues this license after verifying the applicant’s education, training, and examination results.
  • Realtor License: To become a realtor in Michigan, you must obtain a real estate license to buy, sell, or lease properties on behalf of clients. Michigan has its own real estate commission or board responsible for issuing licenses and regulating the industry.
  • Contractor License: General contractors, electricians, plumbers, and other construction professionals must often have a contractor license to work in Michigan. 
  • Cosmetology License: Professionals in the beauty industry, such as hairstylists, estheticians, and nail technicians, must obtain a cosmetology license to provide services. Michigan Boards of Cosmetology oversee licensing and regulations for this industry.
  • Certified Public Accountant (CPA) License: Accountants who wish to become a CPA in Michigan must designate and provide specific services, such as auditing financial statements and obtaining a CPA license from Michigan’s Board of Accountancy.
  • Architect License: Architects must obtain a license to practice architecture in Michigan. This typically involves meeting education and experience requirements and passing the Architect Registration Examination (ARE).
  • Attorney License: Michigan Business Attorneys must obtain a license to practice law in a particular jurisdiction, typically by passing the state’s bar examination and meeting other requirements set by the Michigan bar association.

3. Health and Safety Permits: Michigan businesses involved in food service, hospitality, or other industries directly impacting public health and safety may require specific permits from local health departments or regulatory agencies.

4. Environmental Permits: Michigan businesses that involve activities that may impact the environment, such as waste disposal, air or water emissions, or hazardous materials handling, may require permits from local, state, or federal environmental agencies.

5. Sales Tax License: Michigan businesses that sell goods or services may be required to collect sales tax from customers and remit it to the appropriate tax authority. A sales tax license is typically required to collect and remit sales tax legally.

Michigan business owners must research the specific licensing requirements for their business in their jurisdiction and obtain all necessary licenses and permits to operate legally and avoid potential fines, penalties, or legal troubles.

Requirements For Getting Business Licenses in Michigan

If you start an LLC or any other type of business, you must wait until your Michigan business registration is complete. Once you have completed the necessary steps to register your business in Michigan, you must be prepared with the required documents to apply for business licenses.

  • Name of your company
  • Phone number and company address
  • Employee Identification Number (EIN)
  • Your company’s legal structure (Corporation, Partnership, or LLC)
  • Your business strategy, which includes revenues and costs

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How to Get a Business License in Michigan

To get a business license, you must follow the guidelines below, including determining if your Michigan business requires a license or permit, identifying the appropriate licensing agencies, researching license and permit requirements, completing and submitting license applications, and maintaining license and permit requirements.

Step 1: Determine The Required License or Permit

The first step in obtaining a business license is determining if your business needs one. Some businesses may not require a license or permit, while others may need multiple licenses depending on their industry and location. Some businesses typically require some form of licensing or permit:

  • Professional services, such as medical, legal, and accounting
  • Food establishments, including restaurants, bars, and catering businesses
  • Retail businesses, including stores, shops, and online retailers
  • Construction and contracting companies
  • Manufacturing and industrial businesses

State Licenses

The licenses that you must get first are the licenses within the state. Michigan state licenses require individuals or businesses to engage in certain activities or professions legally. The state government issues these licenses and serves as proof that the license holder has met certain qualifications and standards set by the state. The types of licenses vary depending on the profession or activity, including but not limited to healthcare professionals, contractors, real estate agents, and drivers.

State licenses assure the public that the license holder has undergone the necessary training and education to perform their duties safely and competently.

Federal Licenses

Federal licenses in Michigan are granted by federal agencies and are required for certain activities and industries that fall under federal jurisdiction. These licenses ensure compliance with federal laws and regulations and are necessary for individuals or businesses engaged in the following services.

  • Agriculture: License issued by The U.S. Department of Agriculture
  • Aviation: License issued by The Federal Aviation Administration
  • Alcohol & Tobacco: License issued by The Alcohol and Tobacco Tax and Trade Bureau
  • Ammunition, Explosive, & Firearms: License issued by The Bureau of Alcohol, Tobacco, Firearms, and Explosives.
  • Commercial Fisheries: License issued by The National Oceanic and Atmospheric Administration Fisheries Service
  • Mining & Drilling: License issued by The Bureau of Safety and Environmental Enforcement
  • Nuclear Energy: License issued by The U.S. Nuclear Regulatory Commission
  • Radio & Television (Broadcast): License issued by The Federal Communications Commission
  • Transportation by Sea: License issued by The Federal Maritime Commission
  • Wildlife & Fisheries: License issued by The U.S. Fish and Wildlife Service

Obtaining a federal license in Michigan involves meeting specific criteria and adhering to federal laws and regulations, which can vary depending on the activity or industry.

City-Based License

City-based licenses in Michigan are granted by local municipalities and are required for certain activities or businesses operating within the city limits. These licenses ensure businesses comply with local regulations and ordinances and typically cover business operations, health and safety, zoning, and permits.

City-based licenses vary depending on the location and the nature of the business, but examples may include restaurant licenses, liquor licenses, taxi licenses, and street vendor licenses. Obtaining a city-based license in Michigan involves submitting an application, paying the necessary fees, and meeting specific requirements set by the local government.

Home-Based License

Home-based licenses in Michigan are required for individuals or businesses that operate from their residential property. These licenses regulate and permit activities conducted within a residential setting, such as home-based businesses or rental properties. Home-based licenses ensure these activities comply with local regulations, building codes, zoning requirements, and health and safety standards.

The specific requirements for obtaining a home-based license in Michigan can vary depending on the type of activity and the local municipality but typically involve submitting an application, paying any necessary fees, and meeting specific criteria set by the local government.

Professional License

Professional licenses in Michigan are mandatory for individuals pursuing specific careers or professions that require specialized knowledge, skills, and expertise. The state government grants these licenses and serves to regulate and ensure the competency and ethical practice of professionals in fields such as law, medicine, engineering, teaching, and accounting.

To obtain a professional license in Michigan, individuals must meet education, experience, and examination requirements specific to their profession. These licenses assure the public that they receive services from qualified professionals and protect consumers from potential harm or malpractice.

Step 2: Identify the Michigan Licensing Agencies

Once you’ve determined that your business requires a license or permit, you must identify the appropriate Michigan agencies responsible for issuing these documents. In Michigan, numerous agencies oversee licensing and permitting, including:

  • Michigan Secretary of State: This office is responsible for issuing licenses for many professional services, including legal, medical, and accounting.
  • Michigan Department of Health: Food establishments, healthcare providers, and other businesses related to health and safety may require licenses from this department.
  • Michigan Department of Treasury: If your business sells goods, you may need a sales tax license or permit from this department.
  • Michigan Department of Labor: Businesses that involve construction or contracting may need licenses from this department.
  • Local City or County Governments: Depending on your business’s location, you may also need to obtain licenses or permits from your local government.

Step 3: Research License and Permit Requirements

After identifying the appropriate agencies, research the specific requirements for each license or permit your business needs. This may involve reviewing the Michigan agency’s website, contacting their office directly, or consulting a legal or business professional. Some common requirements for obtaining a business license or permit include:

  • Completing an application form
  • Providing proof of insurance or bonding
  • Passing background checks or inspections
  • Paying application fees

Some licenses or permits may have ongoing requirements, such as annual renewals, inspections, or reporting.

Step 4: Complete and Submit License Applications

Once you’ve gathered all the necessary information and documents, complete the application forms for each required license or permit. Be sure to carefully follow the instructions provided by each Michigan agency, as incomplete or incorrect applications can lead to delays or denials.

In addition to the application forms, you may also need to submit supporting documentation, such as:

Proof of Business Registration

You can find it on the Michigan Secretary of State’s website. There should be a search feature specifically for businesses. This will often be labeled “Michigan Department of Licensing and Regulatory Affairs“. In the search feature, enter the name of the business you are looking for, and once it appears, you will now have proof of your business registration.

Employer Identification Number (EIN)

Aside from opening a bank account, you must have an Employer Identification Number in Michigan to file and submit for a business license. An EIN, also known as a Federal Tax Identification Number, is used by the Internal Revenue Service (IRS) to identify your business for tax purposes. You’ll need an EIN to open a business bank account, file taxes, and hire employees. 

The application of an EIN in Michigan can be through the following:

  • Apply Online- The online EIN application is the preferred method for customers to apply for and obtain an EIN.
  • Apply by Fax- Taxpayers can fax the completed Form SS-4 application to the appropriate fax number), after ensuring that the Form SS-4 contains all of the required information.
  • Apply by Mail- The EIN application Form SS-4 can be filed via mail. The processing time frame to receive the mail is four weeks.
  • Apply by Telephone-International Applicants – International applicants may call 267-941-1099 (not a toll-free number) from 6 a.m. to 11 p.m. (Eastern Time) Monday through Friday to obtain their EIN.

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Proof of Insurance, Bonding, or Worker’s Compensation Coverage

To have a business license, you need proof of insurance, bonding, or worker’s compensation. You need to obtain a certificate or policy document as additional documents for your proof of insurance. Also, there is a database of businesses with worker’s compensation coverage or require businesses to register their insurance or bonding information. Visit your Michigan Department of Labor, Department of Insurance, or another relevant agency website for information about the business’s coverage.

Professional Certifications or Licenses

As I have mentioned, if you will form a general partnership and offer your service, you must have professional certifications or licenses. 

Submit your completed applications and the Michigan business license fee, which ranges from $50 – $300. The processing times for license and permit applications can vary, so plan accordingly and allow ample time for approval.

Step 5: Maintain License and Permit Compliance

Once you’ve obtained the necessary licenses and permits for your Michigan business, it’s essential to maintain compliance with all requirements. This may include:

  • Keep your Michigan licenses and permits current by renewing them on time, typically annually.
  • Reporting any changes to your business, such as a changing Michigan LLC address. You may amend your Michigan Articles of Organization if you change anything in your Michigan business.
  • Maintaining proper insurance, bonding, or worker’s compensation coverage.
  • Complying with any inspection, reporting, or record-keeping requirements.

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Additional Considerations

In addition to the steps outlined above, there are a few additional considerations to keep in mind when navigating the Michigan business licensing process:

  • Licenses and permits are often industry-specific, so research your business type’s requirements.
  • Some businesses may need licenses or permits from multiple agencies at the state and local levels. Be sure to research and comply with all necessary requirements to avoid complications.
  • If your business operates in multiple locations or across state lines, you may need to obtain licenses or permits for each jurisdiction in which you operate. You can form Michigan Foreign LLC
  • Stay informed about licensing and permitting requirements changes, as regulations can change over time.

FAQs

What is a Michigan Business License?
A Michigan Business License is a document that allows an individual or business to legally operate a business within the state of Michigan.
How do I know if I need a business license in Michigan?
Whether you need a business license in Michigan depends on the type of business you want to start and its location.
How do I get a Michigan Business License?
To obtain a Michigan Business License, you will need to go through a process that involves registering your business, which varies depending on your business type.
How long does it take to get a Michigan Business License?
It usually takes anywhere from a few days to a few weeks to get a Michigan Business License because the time frame depends on how long it takes to process your application.
Is a Michigan Business License required to start a business?
It typically depends on the type of business you are starting and the area you plan to operate within Michigan.
How much does a Michigan Business License cost?
Michigan Business License fees vary from one type of business to another, and based on legal structure for business notes ensure to initially consult with state officials in your niche.
Can I operate my business before receiving my Michigan Business License?
It is illegal to operate your business without a Michigan Business License, and also demandable by police officers any time.
Who needs to apply for a Michigan Business License?
Anyone looking to start a business in Michigan will need to apply for a Michigan Business License.
Do I need a business plan to get a Michigan Business License?
No, you don’t need a business plan to get a Michigan Business License, however organized application following business plan increases the chances for approval.
Do I need a Michigan Business License if I work from home?
Yes, even home-based businesses in Michigan require a Michigan Business License.
Can I transfer my business license from another state to Michigan?
You will need to apply for a new Michigan Business License after following Michigan’s application process for business/licensing
Do I need a Michigan Business License if I operate as an LLC?
Yes, even LLCs in Michigan need a Michigan Business License. A business license is different from formation documents.
Can I legally do business in Michigan without a Michigan Business License?
No, it is illegal to do business in Michigan without a Michigan Business License
Is a Michigan Business License the same as a Michigan tax ID number/EIN?
No, a Michigan Business License and a Michigan tax ID number/EIN are different entities, each required in their application/ separate form.
How do I renew my Michigan Business License?
The Michigan Business License renewal process varies, still needing to follow the same guidelines similar to registering a new business or renewing a yearly license.
What happens if I fail to renew my Michigan Business License?
When not renewing Michigan Business License, it becomes impossible to legally operate the business until renewing.
What is a reapplication process for an expired Michigan Business License?
Reapplication requirements change after the License’s being expired, but it includes items, similar to registration/renewal.
Are there different types of Michigan Business Licenses?
Yes, the state of Michigan actually issues different types of business licenses, including but not limited to LLC/ Incorporation license
How important is the Business License certificate?
The Michigan Business License certificate is essential if you want to protect yourself and your business from legal troubles and operate in compliance with state law.
Can a business operate with more than one Michigan Business License?
One business call only have one Business License per business entity registered under its name, itemizing through adequate registration can pose if differently.
Are there situations that my Michigan Business License may be revoked?
Yes, there are certain rules and laws/guidelines by Michigan Regulations stating Business Licenses withdrawal like failing to follow pertinent legal procedures, non-payment of taxes, violating any Michigan state laws issued to specific niche, etc.
What role does local /state government play in obtaining a business license in Michigan?
Both since filing of application to overall registration and approving of license, local and state administrations play a crucial role in issuing a Michigan Business License at respective levels.
Do I need a Michigan Business License for a side hustle in a different state?
If programs have the Michigan Business office in charge of licensing the personal factors become irreversible, meaning one must have a Michigan License even operating in cross-state businesses, so licenses are Non-stop restricted to any particular size / location.
Can a licensed business legally refuse some clientele?
Yes, only by having appropriate ethics and business policies, typically such ideas state unbiased assistance equally to all customers.
Whom do I contact if to get more information if I can’t register my license successful?
Consult with local Michigan regulators or government customer care on urgent matters regardless of the states is mandatory assistance by reliable sources.
Can an overseas citizen own and operate a business in Michigan?
Foreign citizens are permitted to do business in Michigan only while obtaining work permit, legally staying and continue to follow local/ state laws.
Why can’t I find a specific license for my type of business in Michigan?
Certain, specialized, or highly-abandoned forms of businesses could have been ceased its granting by policy laws defined earlier hence becoming restricted now.
Can Michigan Businesses submit online renewal forms mandatory?
Yes, customers can apply for registration renewals of new applications finished online , saving considerable time as taken in offline transactions.
Can schools in Michigan apply for a business license as non-profit entities?
Yes, Michigan during years provided number of options under controlling facilities for businesses operating under non-profit entities alike rest to certain compulsion.
What is the process for obtaining a business license in Michigan?
The process for obtaining a business license in Michigan varies depending on the type of business you want to start.
Do I have to get a business license in Michigan?
Yes, in most cases, you will need a business license if you plan on operating a business in Michigan.
Can I start a business in Michigan without a license?
No, you cannot start a business in Michigan without a license.
How much does a business license cost in Michigan?
The cost of a business license in Michigan depends on the type of business you want to start and the city or county in which you plan to operate.
What type of business license do I need in Michigan?
The type of business license you need in Michigan depends on the type of business you want to start.
Is obtaining a business license in Michigan a complex process?
Obtaining a business license in Michigan can be a complex process, but it is manageable if you have the right guidance and support.
Can I apply for a business license in Michigan online?
Yes, the state of Michigan offers an online tools and resources to apply for a business license.
How can I find out if I need a business license in Michigan?
To find out if you need a business license in Michigan, you should contact your local government office.
What documentation do I need to open a business in Michigan?
The documentation you need to open a business in Michigan varies based on the type of business you want to start.
How long does it take to register a business in Michigan?
It varies, but the estimated of time it would take is typically around two to four weeks to register a business in Michigan.
Will my business name be automatically protected once I acquire a license in Michigan?
Getting a business doesn’t automatically give name protection. You may need to finish filing application with the SOS Office and paying the necessary fees to ensure name protection.
Can I open a business in Michigan if I’m not a resident of the state?
Yes, you can open a business in Michigan as a non-resident, but you must meet all the requirements of establishing a location here in the state.
What is the official step-by-step process to obtain a business license in Michigan?
The official step by step process to obtain a business license in Michigan involves submitting an application to the state of Michigan’s Corporations, Securities, and Commercial Licensing Bureau.
Does Michigan offer any special incentives for small business owners?
Yes, Michigan does offer special incentives for small business owners such as low-interest loans, tax credits, and grants.
Do I have to renew my business license every year?
Yes, depending on the type of business you have registered, you may need to renew your business license every year.
Can I operate a business from my home in Michigan?
Yes, you can operate a business from your home in Michigan, but you may need to meet specific requirements and zoning regulations.
Can I apply for a business license before I have a physical location for my business in Michigan?
Yes, you can apply for a business license before you have a physical location for your business in Michigan.
What is a DBA and do I need one in Michigan?
A DBA, also known as “Doing Business As” allows businesses to operate under different names, and it’s not obligatory to acquire a Michigan DBA filing unless you decide to operate your company under a name distinct from your personal one.
Can I change the name of my business after I’ve obtained a license in Michigan?
Yes, you can change the name of the business on your license in Michigan, but you must renew your license completely and ensure your business-name isn’t similar to that of another company filing.
Do I need to get a sales tax permit for my business in Michigan?
If your company requires collecting or paying sales tax on the things you sell, you want to file a Michigan sales tax permit.
Can I operate a liquor license as well as a business license in Michigan?
Yeah, It varies, contact the Michigan Liquor Control Commission to determine if you need an additional business license for a liquor license.
How do I register for taxes with the State of Michigan as a business owner?
You can register for taxes in the state of Michigan by visiting the Michigan Department of Treasury website and following their outlined steps from there.
What legal structure should I choose for my business in Michigan?
There are several legal structures to choose from for starting a business in the state of Michigan, these can include sole proprietorship, LLC, and corporation and LLC.
What are the health and safety regulations for business owners in Michigan?
Health and safety regulations of your company depend on the type of business you plan on starting. County and local Governments organizations in Michigan enforce these health and safety regulations.
Are there any online tools that assist me in acquiring permits as a business owner in Michigan?
Yeah, the M.gov plug-in will assist you by permitting configurations according to the state and your niche’s business previously selected, starting a business.
Can an out-of-state entity do business in Michigan?
Yes, a non-Michigan or out-of-state entity can seek to do business in Michigan by acquiring a foreign associates application and submission to SBRE’s Corporations/Securities/Commercial Document Management Division.
What are the most common reasons for business license application rejection in Michigan?
The main reason a business license application may get denied relates to name exclusivity. Be sure to validate the availability/conjunction of all your requested license names or possibilities before submission.
How can I check my license requirements and standing in Michigan?
You can check your current business license status, renewal dates, and due guidelines by using the SOMINT(GUL) Business Entity profiles research feature inside State of Michigan business license or employee portal.
How can I get help with obtaining a business license in Michigan?
The Michigan Department of Labor and Economic Opportunity offers guidance to company owners or specific trade requirements in Michigan country councils alongside approval processing and licensing to communicate helpful tips/resources for business owners in Michigan.

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Conclusion

Obtaining the necessary licenses and permits is crucial in starting a new business in Michigan. Following the steps outlined in this guide and consulting with the appropriate agencies or professionals, you can ensure that your business complies with all state and local requirements. This will protect your business from legal issues and help establish your reputation as a responsible and trustworthy business operator.

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