Steps to Apply for a Michigan Business License
The process of conducting a Michigan business license search can be quite arduous especially when it comes to identifying the type of permits specific to your business. Hence, we have created a list of Michigan business licenses and permits as well as requirements, so it becomes easier for you to understand how they can be obtained.
1. Search for necessary Michigan general business licenses
One of the most common types of business licenses is a general license, and it is applicable in several states. The state of Michigan doesn’t have the provision for a single general operating license or permit for businesses. The primary Michigan business license is one based on the industry your business is classified under. Let’s look at an example to understand this:
Example: You are planning to establish a transportation network company in Michigan. You will be required to apply online in order to obtain a Michigan business license. You will need to use the Michigan Commercial Licensing, Enforcement and Regulation System (MiCLEAR) to apply for the same.
You can conduct a Michigan business license search using the Department of Licensing and Regulatory Affairs (LARA) portal. This is also known as a “State License Search” and it will help you identify licenses issued by the state department.
2. Obtain applicable federal licenses
Most small businesses or large enterprises require state business licenses and local permits but some specific industries or areas are governed by the Federal government and may require you to apply for a Federal license. If your business falls under any of the following industries then you will need to contact the respective federal agency for obtaining a license.
- Drug Manufacturing – You will need to contact Food and Drug Administration (FDA)
- Selling of tobacco, alcohol, or firearms – Licenses are issued by the Bureau of Alcohol, Tobacco, Firearms, and Explosives (AFT)
- Investment Advising – You need to approach the Securities and Exchange Commission (SEC)
- Broadcasting – The Federal Communications Commission (FCC) governs these licensing requirements
- Preparation of meat products – Licensing requirements are overseen by the Food and Drug Administration (FDA)
- Ground transportation – You need to obtain a license from the Department of Transportation (DOT)
3. Search for local or county licenses and permits
Once you form a business in Michigan, the city or county your business is situated in will also define the type of license required. The types of licenses, fees, and local ordinances applicable will vary depending on the city or county. Let’s look at an example to understand how you can obtain a Michigan business license at the county or city level.
Example: The physical address of your company is in Detroit, MI. Now, if your business falls under any of the categories mentioned by the city then you will need to obtain a local Michigan business license and permit. The categories are Amusement, Consumer Services, Food Services, Gas Station, Lodging, Motor Vehicle for Hire, Night Club, Retail, Second Hand Sales, and Vendors among others. Now, if you want to start a hotel or public lodging then you will need certain clearances from the Detroit Health Department, Fire Marshal Division, and Treasury Clearance. You will also need to apply for a Commercial Certificate of Compliance. Once you have all these clearances, you will be able to apply for a Michigan business license under the Lodging Category. The fee will vary according to the type of hotel and number of rooms like if you were to start a hotel having 1-50 rooms then the fee will be $345/year and if you start a Public Lodging House then the fee is $223/year.
4. Check for professional licenses
Of the many licensing classifications, one of the more significant types of licensing classifications is professional licenses. This License is governed by the Bureau of Professional Licensing (BPL). A Professional Michigan business license is divided into two categories and they are:
- Health Licensing – This area focuses on issuing licenses based on a specific health profession. Some of the common professions include Acupuncture, Occupational Therapy, Behavior Analysts, Pharmacy, Genetic Counseling, Veterinary Medicine, Psychology, Nursing Home Administrator, and Dentistry among others. You will need to apply online using the Michigan Professional Licensing User System (MiPLUS) for the appropriate license or permit.
- Occupational Licensing – The distribution of Occupational Licenses is governed by the Michigan Occupational Code. There are several categories of occupational professions for which you will need to obtain a Michigan business license. Some of these categories include Accountancy, Appraisal Management Companies (AMCs), Real Estate Brokers, Professional Surveyors, Personnel Agencies, Professional Engineers, and Collection Agencies among others.
5. Obtain any other necessary Michigan licenses and permits
The type of business activity will also define whether you need to apply for a Sales Tax License or not. This is a type of Michigan business license required by businesses or individuals planning to sell tangible personal property. The type of business activity can vary from retailing to a variety of services. There is no fee for a sales tax license.
6. Obtain home-based business licenses if required
Home-based businesses are gaining popularity due to several factors with low cost being a primary factor. If you are planning to start a business from home then it may be subject to some business laws as well as state regulations. Most home businesses are normally sole proprietorships, while some may even be partnership firms. When you operate from your home, the type of Michigan business license and permits required may also vary depending on the business activity. You might have to apply for temporary licenses and permits or even occupational licenses. For this reason, it is essential to conduct a proper Michigan business license search. Here are some details to focus on:
- You need to be aware of local zoning regulations and obtain the necessary clearances as any violation can lead to fines or even the closure of businesses.
- You may require local licenses for which you will need to check with the County Clerk’s office or the licensing departments of the city where your business is located.
- The licenses required by a home-based business will depend on the business activity. The following example will provide more clarity.
Example: If you are an event planner starting your business from home then you may require both yearly and temporary permits and licenses. You will first need to obtain an event planning certification. It is necessary to obtain a Michigan business license depending on factors connected to a specific event like serving alcohol, food preparation and the selling of food, outdoor events, outdoor structures, live entertainment, and large gatherings. If your event has outdoor structures then you will need a building permit and need food licenses from the city’s Department of Health.
7. Renew and maintain licenses
Once you have obtained a Michigan business license, it will remain valid for one year. It is important to note that temporary licenses and permits are required for specific purposes and events and therefore do not require renewal. The licenses issued by the state, or city will need to be renewed to ensure the business operations are not interrupted. Some professional and occupational licenses also need to be renewed annually like the Personnel Agency licenses, which expire each year on December 31st. You can renew Michigan business licenses and permits online using the Michigan Professional Licensing User System (MiPLUS) or the Michigan Commercial Licensing, Enforcement and Regulation System (MiCLEAR).
Local license renewal dates may vary, and you will have to renew them with the county or city that has issued them. If you fail to renew the licenses and continue to operate your business without a valid license then you may acquire penalties, with each violation constituting a separate offense. That is why IncParadise offers a “Business License Research Report” service to ensure that you can obtain the required licenses. This research report contains a list of filing instructions, supporting document requirements, and fees for all business licenses and permits for your company in Michigan.