How to Get a Business License in Michigan

Michigan is affordable to start — the complexity is local

Michigan's state-level business registration is cheap and straightforward. LARA (the Department of Licensing and Regulatory Affairs) handles entity filings and professional licensing. There is no state business license. The complexity, as in most states, lives at the local level — your city or township decides what business licenses and permits you need.

If you are in Detroit, the process has extra steps. Everywhere else, it is manageable.

Step 1: Register your business with LARA

File with the Michigan Department of Licensing and Regulatory Affairs (LARA), Corporations Division.

LLC: File Articles of Organization. Costs $50. File online through LARA's Corporations Online Filing System (COFS).
Corporation: File Articles of Incorporation. Costs $60 (profit) or $20 (nonprofit).
Sole proprietorship: No state filing required. If you use a trade name, file an Assumed Name Certificate with your county clerk.

Online filings are typically processed same day to next business day. Michigan has one of the fastest state filing systems — and at $50 for an LLC, one of the cheapest.

Step 2: File your assumed name (DBA)

If you are operating under a name different from your legal name or exact entity name, file an Assumed Name Certificate (DBA) with the county clerk in the county where your business is located. The fee is typically $10 to $20.

Step 3: Get your EIN

Free, instant, at irs.gov.

Step 4: Register with the Michigan Department of Treasury

Sales tax license: Michigan has a 6% state sales tax (no local add-on). If you sell tangible goods at retail, you need a sales tax license. It is free to register.
Use tax: For purchases from out of state used in Michigan.
Withholding tax: If you have employees, register for Michigan income tax withholding.
Corporate income tax (CIT): C corporations register for the Corporate Income Tax. Pass-through entities (LLCs, S corps) pass income to the owners' personal returns.

Step 5: Register with Michigan Unemployment Insurance Agency

If you have employees, register with the Unemployment Insurance Agency (UIA) for employer contributions. This is mandatory. You also need workers' compensation insurance, which is purchased through private insurers.

Step 6: Get your local business license

Michigan's cities, townships, and villages each have their own business licensing requirements (or lack thereof).

Detroit

Detroit requires a business license from the Buildings, Safety Engineering, and Environmental Department (BSEED).

Certificate of Compliance — confirms your space meets building and fire codes
Business license — specific to your business type
Additional permits for food service, alcohol, entertainment, etc.

Detroit's process involves inspections and can take 2 to 6 weeks. The city has been working on making the process more efficient, but plan for delays.

Other Michigan cities

Grand Rapids: Business license required for certain business types. Check with the city's Community Development Department.
Ann Arbor: Business registration through the city clerk. Certain businesses need specific permits.
Lansing: Business license through the city's Economic Development office.
Smaller cities and townships: Many do not require a general business license. Check with your local township or city clerk.

Step 7: Industry-specific professional licenses

LARA handles professional licensing for a wide range of industries in Michigan:

Restaurants: Food service establishment license from your local health department, under the oversight of the Michigan Department of Health and Human Services (MDHHS).
Bars: Liquor license from the Michigan Liquor Control Commission (MLCC). Michigan uses a quota system for some license types. Class C licenses (bars) are limited — one per 1,500 people in each municipality. If all quota licenses are taken, you buy one on the secondary market.
Contractors: Michigan requires a Residential Builder License or Maintenance and Alteration Contractor License through LARA for residential work. Commercial work does not require a state license, but local requirements vary.
Salons and barbers: Licensed through LARA's Board of Cosmetology.
Other professions: LARA licenses over 170 occupations — real estate, nursing, engineering, accounting, etc. Check their Bureau of Professional Licensing page.

What it costs: Michigan business setup fees

Item	Cost	Frequency
LLC filing (LARA)	$50	One-time
LLC annual statement	$25	Annual
Assumed Name (DBA)	$10 - $20	One-time (no renewal)
EIN (IRS)	Free	One-time
Sales tax license (Treasury)	Free	One-time
Local business license	$0 - $300	Annual (where required)
MLCC liquor license (Class C)	$600 - $1,000+ (state fee)	Annual
MLCC quota license (secondary market)	$15,000 - $100,000+	One-time purchase
Health department license	$100 - $500	Annual
Residential builder license	$200	Every 3 years

Timeline: how long does it take?

Step	Processing Time
LLC filing (online)	Same day to 1 business day
EIN	Immediate (online)
Treasury tax registration	1 - 3 weeks
Local business license	Same day to 4 weeks (varies by city)
Detroit business license	2 - 6 weeks
MLCC liquor license	60 - 120 days
Health permit	2 - 4 weeks
LARA professional license	2 - 8 weeks

Michigan-specific gotchas

$50 LLC filing is a bargain. Michigan has one of the cheapest LLC filings in the country, and it processes fast. Take advantage of it. But do not forget the $25 annual statement — it is due by February 15 each year. Late filing leads to dissolution after a grace period.
Michigan's liquor license quota system is tight. Class C licenses (full bar) are limited to one per 1,500 people in each municipality. In popular areas like downtown Detroit, Ann Arbor, or Grand Rapids, all quota licenses may be spoken for. Buying one on the secondary market can cost $15,000 to $100,000+ depending on the location. The MLCC also offers some non-quota licenses (like a Small Distiller or Small Wine Maker), so check whether those fit your business model.
LARA is a one-stop shop for professional licensing. If your industry requires a professional license, LARA almost certainly handles it. They license over 170 occupations. Check their website before assuming you do not need one.
Local requirements vary more than you think. Michigan has over 1,800 townships, cities, and villages. Some require business licenses; many do not. The only way to know is to check with your specific local government. Do not assume that what applies in one Michigan city applies in another.
Personal property tax on business equipment. Michigan levies a personal property tax on business equipment, furniture, and fixtures. If you own business equipment, you must file a Personal Property Statement with your local assessor by February 20 each year. This one catches a lot of people off guard in their first year.

What happens if you do not register

LLC dissolution for failing to file the annual statement
Treasury penalties for collecting sales tax without a license
MLCC fines and criminal charges for selling alcohol without a license
Local fines for operating without required city or township permits
Personal liability for workers' comp claims if you do not carry coverage

Get your Michigan permits sorted

Michigan makes the state-level stuff easy and cheap. The LLC filing is $50, it processes in a day, and the annual reporting is minimal. Where it gets more involved is local licensing (especially in Detroit) and industry-specific permits through LARA.

Use the free permit checker to see every permit your Michigan business needs. Enter your business type and city, and get the full rundown of agencies, fees, and deadlines.

Opening a food business? The restaurant permit checklist covers the health department requirements. Running a bar? Check the bar permit guide for the MLCC process — the quota system alone is worth understanding before you commit to a location.