What Business Licenses & Permits are Needed in Michigan?
Starting a business in Michigan will mean potentially registering with a number of federal, state, and local agencies. Let’s take a look at common licenses and permits a business will register for in Michigan.
Before applying for any licenses, the legal structure of the business will need to be established. Learn more about the differences between the sole proprietorship, general partnership, corporation, and Limited Liability Company (LLC).
Related: Comparison of Business Entities
Learn more about forming an LLC in Michigan
Also see: Steps to starting a business in Michigan
General Business License
There is no general state of Michigan business license, however, many cities require businesses to be licensed to operate. Rules for business registration vary depending on location and what the business does. Below are a few cities that have local business license requirements.
Detroit – In order to open a business in Detroit, a Certificate of Occupancy is required from the Zoning Division before operating a business out of a building. After the building is approved for use, a Business License is required from the Business License Center.
Grand Rapids – The City of Grand Rapids, requires a business license for certain businesses such as dance halls, home-based businesses, mobile food vendors, and more.
Warren – Some businesses operating in Warren’s city limits are required to be licenses by the City Clerk, such as bowling alleys, self-serve car washes, caterers, tattoo parlors, and several others.
Sterling Heights – Every business operating in the city of Sterling Heights must register with the City Clerk. There is a one-time filing fee to register a new business.
In addition to the Business Registration, certain businesses such as banquet & event facilities, tattoo studios, junk yards, businesses selling alcohol, and several more.
Lansing – The City Clerk’s Office issues business licenses for entities operating billiard rooms, health clubs, ice cream vendors, and others.
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Building & Zoning Permits
Zoning – Depending on the location of the business, it’s important to verify whether the business needs an occupancy permit or has specific zoning regulations to follow. Depending on city codes, home-based businesses may need to apply for a home occupation permit.
Building Permit – A building permit may be needed from the city or county building and planning department if there is any construction or renovations to a facility.
Signage Permit – Some municipalities require a permit before adding signage.
Michigan Sales Tax License
Retailers & wholesalers selling tangible personal property, some contractors, and certain services in Michigan need a register for a Sales Tax License (also called a Sales Tax Permit) from the Michigan Department of Treasury.
Certificate of Exemption
Businesses purchasing merchandise to resell will usually want to obtain a Michigan Certificate of Exemption in order to not pay sales tax for merchandise that is being resold to customers.
A variety of professions in the state are regulated and need to be registered before offering certain services. A few common occupations that require licensing in Michigan include; antique dealers, bakeries, car washes, lawn services, dog groomers, photographers, and many more. Additional information, fees, and licensing requirements for professions are available from the Michigan Department of Licensing and Regulatory Affairs (LARA).
Employer Identification Number (EIN)
Many businesses will register with the Internal Revenue Service (IRS) for an EIN (also referred to as a FEIN, Federal Employer Identification Number, or Federal Tax ID Number). The EIN is the business equivalent of a Social Security Number for an individual. Corporations, Limited Liability Companies, Partnerships, and Sole Proprietorships with employees will all need to register for one. Sole Proprietorships without employees can use the owner’s Social Security Number.
There is no cost for an EIN, and it only takes a few minutes to get.
Assumed Name Registration
While not a license, it’s common for Sole Proprietorships and Partnerships operating under a business name that is different from the full name of the owner(s) to register for an Assumed Name Certificate (also known as a Doing Business As or DBA) with the County Clerk’s Office in the county where the business is located.
These are just some of the most common business licenses a new business will need to register before starting. Before starting your business, be sure to check with City Hall, County Clerk, Chamber of Commerce, and/or Economic Developer in your area to get more information regarding business licensing.