Determine if the name of your Limited Liability Company is available
Go to the State of Michigan DELEG website to determine if your proposed name is available.
Determine if the name of your Limited Liability complies with the requirements of MCL 450.4204
Michigan law imposes requirements on the name of an LLC. Specifically MCL 450.4204 requires the name of a limited liability company shall contain the words "limited liability company", or the abbreviation "L.L.C." or "L.C.", with or without periods or other punctuation. You should review MCL 450.4204 to ensure that your name complies with all of the statutory requirements.
Draft and File the Articles of Organization with the State of Michigan
Once you have determined that the proposed name of your LLC you will need to draft and file the Articles of Organization with the State of Michigan. A sample form can be obtained by following the link below:
A LLC is not required to have an Operating Agreement under Michigan Law. However, I strongly advised clients to have an Operating Agreement as it is necessary to document how the LLC is run. It is also proof of following the corporate formalities which is good evidence to avoid any potential creditor from piercing the corporate veil. Similarly, if there are multiple members, it is a good way to agree on how potential issues will be resolved in advance.
Register for an EIN and Michigan Taxes
The Michigan Department of Treasury provides useful information on what Michigan Taxes your LLC maybe subject to. More information is available at the following website: http://michigan.gov/taxes/0,1607,7-238-43519_43521-155361--,00.html
Apply for an EIN with the IRS. This can be done online at the following website: http://www.irs.gov/businesses/small/article/0,,id=102767,00.html
Open the Bank Account
Make sure to open a separate bank account in the name of the LLC. A creditor would likely be able to pierce the corporate veil if corporate funds are commingled with personal funds. As such, it is always advisable to have a separate bank account for your business. The Bank will typically require your Articles of Organization, EIN, and/or Operating Agreement to open the Account.
Obtain the necessary Licenses or Permits
Michigan law requires certain companies to be licensed prior to commencing business. For example, if you are a building company, make sure that the LLC is properly licensed prior to entering into contracts or you risk not being paid. Similarly, local ordinances may require you to obtain a business permit. As such, it is advisable to check with your local municipal government to determine if there are any specific requirements to do business in your area.
In Michigan, if you employee 3 or more people or have employed anyone for at least 35 hours per week for 13 or more weeks, you are required to carry Worker's Compensation Insurance. When obtaining Worker's Compensation Insurance you should also inquire about obtaining a general commercial policy for your business. Similarly, you should prepare an employee handbook and any necessary contracts for employees to limit your liability and avoid disputes.
Begin Operating your LLC
After you have completed the above steps you can begin operating your business. You will be required to file an annual report with the State of Michigan DELEG in order to maintain your status as a LLC. Similarly, should you have any questions or issues with starting your business or any of your business practices it is always advisable to contact an attorney.
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