How to Get a Small Business License in Michigan

If you want to start a small business in Michigan, you need to fulfill your legal requirements. You need to register your business and pay your taxes. But you also need to obtain the licenses and permits required for your business.

Let's look at the licenses, permits, and registrations you need to obtain before your business can legally open.

Which Business Licenses Do You Need for Your Small Business?

When starting a business in Michigan, you must:

• register your business entity with the Michigan Department of Licensing and Regulatory Affairs (LARA)
• file taxes with the Michigan Department of Treasury (DOT), and
• apply for business licenses and permits with your state, county, and town.

The types of licenses and permits your business must apply for depends on your business structure, industry, and location. The main types of business licenses, permits, and registrations are:

• general business licenses
• professional licenses
• seller's permits (sometimes called "sales tax certificate")
• zoning and building permits, and
• doing business as (DBA) registrations.

(For more general guidance, see our article on the legal requirements for starting a small business.)

General Business License in Michigan

Businesses don't need to obtain a general business license from the state to operate in Michigan. However, some cities might require businesses to apply for a general business license if the business will be located and operating within city limits. You should contact your city or county to find out whether a general business license is required.

Alternatively, your city or county, like the state, could require licensing specific to your industry or operations. For example, Detroit requires certain businesses to have licenses but the city doesn't require all businesses to have a general license. Likewise, the City of Ann Arbor requires licenses for only some businesses.

Visit your city's website or contact local officials to find out whether your business operations require a license. Each city will have its own procedure and license fee.

Professional and Occupational Licenses for Businesses and Individuals in Michigan

Before you start practicing, you might have to get special licensing or certification for your profession or occupation. Depending on the rules of your profession or occupation, you could need to get a license for yourself and for your business.

LARA's Professional Licensing

You can get information about many professional and occupational licenses from the Bureau of Professional Licensing (BPL), a division of LARA. The BPL is in charge of individuals who are regulated by the Michigan Occupational Code or the Public Health Code. For example, the BPL oversees dentistry, nursing, psychology, and veterinary medicine as well as architects, accountants, barbers, and real estate brokers. (Visit the BPL website for a full list of the professions and occupations that the BPL oversees.)

The BPL website includes links to the professions and occupations it's in charge of. By clicking on these links, you're taken to a webpage with the following information and resources for that profession or occupation:

• board contact information
• licensing information (including detailed licensing guides)
• licensing applications and forms
• board meetings, minutes, and agendas
• frequently asked questions, and
• laws, rules, and regulations.

In addition to the BPL, LARA hosts other regulatory bureaus that might regulate your profession or occupation such as the:

• Child Care Licensing Bureau: This bureau issues state licenses for childcare facilities and enforces federal and state requirements.
• Cannabis Regulatory Agency: This bureau issues cannabis licenses to growers, processors, transporters, and to other facilities.
• Liquor Control Commission: This bureau issues licenses and permits related to the sale and consumption of alcohol.
• Unarmed Combat Commission: This bureau regulates professional boxing and mixed martial arts.
• Bureau of Community and Health Systems: This bureau issues licenses and regulates foster care facilities, hospitals, nursing homes, hospice residences, substance use disorder programs, and similar facilities and programs.

You can apply for, renew, and modify your license online using LARA's Michigan Professional Licensing User System (MiPLUS).

Not all professions and occupations can be found on the LARA website. Your regulatory authority might have its own website and resources. For example, the State Bar of Michigan regulates attorneys, and it has its own website and resources.

Regulatory Licenses and Permits for Businesses

Not every Michigan business needs a license. However, many types of businesses either can or must get a license. In many instances, the necessary license is issued by a state agency. The State of Michigan's primary website, michigan.gov, has a state license search for state licenses and permits. You can either do a search for a particular type of license or click on a link to view an alphabetical list.

The list of licenses is extensive: It contains hundreds of items, from acupuncture to x-ray technologist. In most cases, by clicking on a link for a particular license, you'll be taken to a webpage with information on which state agency is responsible for the license, as well as additional information on laws or regulations relating to the license.

Michigan Sales Tax License

If you sell tangible personal property, then you must apply for and obtain a sales tax license from the DOT to collect and pay sales tax in Michigan. You can register your business and apply for your sales tax license in one of two ways:

• register online using Michigan Treasury Online (MTO), or
• mail a completed Registration Application (Form 518) to the DOT.

After you register, you can receive your sales tax license in just seven days.

For more, visit the sales tax license FAQ webpage on the Michigan state website.

Local Zoning and Building Permits

In some instances, such as if you'll be constructing or renovating a space, you'll need to get special zoning and building permits. Before you start using a space for your business, you'll be required to obtain a certificate of occupancy or a similarly named document to show that your building is safe to use. Typically, you can only receive this certificate after you've passed all inspections and received the required building permits.

For instance, Detroit requires you to get a certificate of occupancy and compliance before you can legally occupy or use your space.

Zoning laws. If your type of business isn't in line with the zoning code, you can find another space or potentially apply for a special use permit. A special permit can provide your business with an exception to the current use laws.

Building code. You can work with local departments and agencies to apply for building and construction permits. You'll likely need to have inspections related to your space's structural, electrical, mechanical, and plumbing features.

If you intend to lease a commercial space, make sure you have a section in the commercial lease that ensures the building and your use of the space are in line with the zoning laws.

Filing an Assumed Name Certificate in Michigan

Sole proprietorships and general partnerships that use a business name that's different from their real names are using an assumed name—also known as a "fictitious name" or "DBA." Under Michigan law, sole proprietors and partnerships must register their assumed name with their county clerk before they can transact business under that name. (Mich. Comp. Laws § 445.1 (2023).)

For example, suppose Tia Landry and Tamera Campbell form a partnership and start a publishing company called "Sister, Sister Publishing." Because their publishing company's name doesn't contain their real names, Tia and Tamera would need to file an assumed name certificate with the county where their publishing company will be located.

For corporations, limited liability companies (LLCs), and limited partnerships, an assumed name is one that's different from the name the company has on record with LARA. If any of these entities use an assumed name, they'll need to file a certificate of assumed name form with the Corporations, Securities, and Commercial Licensing Burea of LARA.

As of 2023, the filing fees are as follows:

• For sole proprietors and partnerships, the fee is $6.
• For corporations or limited partnerships, the fee is $10.
• For LLCs, the fee is $25.

To learn more, see the assumed names/dba's webpage on the Michigan state website.

Other Licenses and Permits Your Business Might Need

In addition to the licenses and permits discussed above, you might be required to comply with other laws and regulations. For instance, your business might need to apply for special licensing or follow special rules related to:

• safety
• health, and
• the environment.

Sometimes these areas are encompassed within other licenses, permits, and registrations. Other times, these licenses and permits will require a separate process. If you're in a highly regulated field, you're more likely to need additional licenses and permits. You should check with your federal, state, and local governments for more information.

Additional Information for Michigan Small Businesses

You can find answers to many Michigan small business questions by checking the website of the Michigan Economic Development Corporation (MEDC). On the MEDC website, you can also find a downloadable Guide to Starting and Operating a Small Business, prepared by the Michigan Small Business Development Center (SBDC). This guide includes instructions and information about various licensing, permitting, and registration processes in the state.

Finally, you can also find useful information and options for online registrations on the business section of the Michigan state website. You can find information related to starting a business, business taxes, and hiring employees.

You can also find more information on the small business section of our website. If you're looking to dive in further, you can also find expanded information in many Nolo books, such as Legal Guide for Starting & Running a Small Business, by Fred S. Steingold, and The Small Business Start-Up Kit, by Peri Pakroo.

If you need more personalized legal assistance, consider reaching out to a Michigan business attorney. If possible, you should try to find a lawyer who has experience assisting businesses in your industry. An attorney can help you navigate the steps to get your business license or permit.