Starting a service business in Michigan

Form your business in Michigan

Michigan LLCs are formed by filing Articles of Organization, Form CSCL/CD-700, with LARA's Corporations Division. The nonrefundable fee printed on the July 2025 revision of the form is $50.00, as listed by LARA in October 2026. You can submit the form online through the Corporations Division's online filing system, mail it with a check, or deliver it in person in Lansing. The form also notes a fee waiver path under MCL 450.5101 when a majority of the initial membership interests will be held by honorably discharged veterans. LARA sells optional expedited review on top of the base fee: 24-hour service costs $50 for formation documents, according to the instructions on its assumed name form.

Ongoing state filings

LLCs file an Annual Statement with the Corporations Division by February 15 each year after formation. The fee is $25.00 as listed by LARA in October 2026. If you form the LLC after September 30, you skip the statement due the very next February 15. LARA opens online filing on October 15 and emails a reminder 90 days before the due date to the address on file. Miss it and, after a two-year grace period, the company can be dissolved and you may lose rights to your name and any assumed names.

Using a business name (DBA)

Where you file depends on who owns the business. A sole proprietor or general partnership using a name other than the owner's files a certificate with the county clerk under MCL 445.1, in each county where you transact business; ask your county clerk for the current fee. An LLC files a Certificate of Assumed Name, Form 541, with LARA instead, under MCL 450.4206. The fee for an LLC is $10.00 as listed on the form in October 2026, and the name stays good until December 31 of the fifth full calendar year after filing. You can renew in the 90 days before it runs out.

Not sure whether you need an LLC at all? Read LLC vs sole proprietor for contractors, then get your free EIN from the IRS.

Licensing for service trades

LARA's Bureau of Construction Codes licenses residential builders and maintenance and alteration (M&A) contractors under Article 24 of the Occupational Code (Public Act 299 of 1980). Article 24 covers anyone who builds a residential structure, or who repairs, alters, adds to or improves one, for compensation beyond wages for their own labor. The M&A license is trade-specific: LARA lists carpentry, concrete, excavation, insulation work, masonry, siding, roofing, screens and storm sash, gutters, tile and marble, house wrecking, swimming pools and basement waterproofing, and only the trades printed on your license are covered. The same bureau licenses electrical, plumbing, mechanical, boiler and elevator contractors and their individual tradespeople, mostly through its Accela online portal, with processing times it puts at three to five weeks. Lawn and pest services that apply pesticides for hire fall under a different department (see below). Cities and townships enforce their own permits and inspections, so check with the local building department before you start.

• LARA Bureau of Construction Codes: Residential Builders and M&A Contractors: Residential builder and maintenance and alteration contractor licenses (Article 24)
• LARA Bureau of Construction Codes: Licensing Section: Electrical, plumbing, mechanical, boiler and elevator licenses and registrations
• Michigan Department of Agriculture and Rural Development: Pesticide Application Businesses: Pesticide applicator certification and pesticide application business licenses

Workers' compensation

Michigan's Workers' Disability Compensation Agency says a private employer must carry coverage if it regularly employs three or more employees at one time (part-timers count), or if it regularly employs even one employee 35 or more hours a week for 13 weeks or longer during the preceding 52 weeks. A sole proprietor working in the business is never counted as its employee, but the agency treats a managing member of an LLC as an employee of the LLC. You can comply by buying an insurance policy, by self-insuring, or by properly executing an exclusion form, and an employer below the thresholds can choose to accept coverage voluntarily. The agency warns that failing to comply can bring prosecution and financial penalties. Read its employer FAQ before you assume a seasonal crew falls under the line.

More on coverage: business insurance for contractors.

Sales tax on services

The Michigan Department of Treasury collects a 6% sales tax from businesses that sell tangible personal property to the final consumer, and cities and local units are not allowed to add their own. Treasury applies use tax to certain services, naming telecommunications and hotel accommodations. For contractors, its construction FAQ is direct: a contractor who constructs, alters, repairs or improves real estate is treated as the consumer of the materials, pays tax when buying them, and does not charge sales tax to customers or break the tax out on an invoice. If you also sell goods at retail, register with Treasury for a sales tax license, which runs January 1 through December 31; every filer submits an annual return by February 28.

Recording business calls in Michigan

MCL 750.539c bars using a device to eavesdrop on a private conversation without the consent of all parties, a felony carrying up to 2 years or a $2,000 fine. But MCL 750.539a defines eavesdropping as listening to or recording the private discourse of others, and the Michigan Court of Appeals in Sullivan v. Gray (1982) read that wording to leave out a participant who records their own conversation. The Michigan Supreme Court has not squarely settled the point, so the safest practice for a business line is to tell callers when a call is recorded. See our guide to recording business calls.

See our guide to recording business calls before you turn on call recording or an AI receptionist.

How the seasons shape the work

Michigan's two peninsulas and Great Lakes shoreline shape the work calendar. Lake-effect snow off Lake Michigan hammers the west side and the Upper Peninsula, which makes plowing and roof-rake work a winter staple, while the Detroit and Grand Rapids metros run on spring cleanups, a packed May to September exterior season, and a fall rush of gutter cleaning and leaf removal. Freeze and thaw cycles crack concrete and heave patios, so spring repair calls stack up fast, and up north the cottage season brings openings in May and closings in October.

Applying pesticides for hire takes two credentials

If your lawn or pest service applies pesticides for pay, MDARD requires a certified or registered applicator and a separate pesticide application business license. The business license costs $100 to apply or renew, expires every December 31, and needs a certificate of liability insurance plus a certified applicator whose categories match the work, all as listed by MDARD in October 2026. MDARD says to allow four to six weeks for the business license after certification, so start in winter if you plan to treat lawns in April.

One M&A license does not cover every exterior trade

Because LARA prints the specific M&A trades on each license, a company licensed for gutters and siding is not automatically covered for roofing or concrete. If you plan to add a service line, check whether it is one of the listed trades and whether your license includes it before you advertise it.

Then set up the back end that gets you hired

The paperwork makes you legal. Customers still have to find you, reach you and pay you. Before your first job, set up a business phone number, email on your own domain, a Google Business Profile, a simple website, and a way to send quotes and take card payments. The launch checklist lays out the order.

Michigan questions