Jake Lawson here. I’ve helped over 1,200 entrepreneurs launch their businesses, and here’s what I’ve learned: forming your Michigan LLC is just step one. The real fun starts when you figure out which licenses and permits you actually need. Spoiler alert—it’s not as scary as it sounds, but you definitely can’t wing it.
So you’ve got your shiny new Michigan LLC. Congratulations! Now comes the question every new business owner asks: “What licenses do I need?”
The honest answer? It depends on what you’re doing and where you’re doing it. But don’t panic—I’m going to walk you through exactly how to figure this out without losing your mind or your wallet.
The Reality Check: Do You Even Need a Business License in Michigan?
Here’s something that’ll surprise you: Michigan doesn’t require a general business license at the state level. Nope, not kidding. Unlike some states that make everyone pay for a “privilege to do business” license, Michigan keeps it simple.
But before you start celebrating, remember this golden rule I’ve learned from 15 years in this business: just because the state doesn’t require a general license doesn’t mean you’re off the hook entirely.
You might still need:
- Industry-specific state licenses
- Local municipal permits
- Federal licenses (for certain industries)
- Sales tax permits (if you’re selling products)
How Michigan Business Licensing Actually Works
Think of business licensing like a three-layer cake—and yes, I’m using a food analogy because I’m hungry, but it works. You’ve got three potential layers of requirements:
Layer 1: State-Level Licenses
Michigan keeps it reasonable here. No blanket “business license” for everyone, but certain industries need specific permits. We’re talking things like:
- Running a daycare center
- Operating a food truck
- Cutting hair professionally
- Selling used cars
The key is knowing whether your specific business activity triggers a state requirement.
Layer 2: Local Municipal Requirements
This is where it gets interesting. Your city, county, or township might have their own rules. Some places require all businesses to register (and pay a fee), others only care about certain activities.
I’ve seen entrepreneurs get blindsided by this because they researched state requirements but forgot to check with their local government. Don’t be that person.
Layer 3: Federal Licenses
Most businesses can ignore this layer entirely. Federal licenses are reserved for industries like aviation, firearms, broadcasting, and anything involving interstate transport of regulated goods.
Unless you’re planning to start an airline or brew commercial beer, you probably don’t need to worry about federal licensing.
Finding Your Michigan State License Requirements (The Smart Way)
Michigan actually makes this pretty easy with their online search tool. Here’s how I tell my clients to use it:
Step 1: Go to the Michigan.gov State Business License Search Step 2: Enter keywords that describe what you actually do—not your grand vision, but your day-to-day activities Step 3: Browse the results and read the fine print
Pro tip from someone who’s done this hundreds of times: search multiple ways. If you’re opening a restaurant, try “restaurant,” “food service,” “kitchen,” and “dining.” Different keywords can surface different requirements.
You can also browse their alphabetical list of all licenses and permits, though fair warning—it’s longer than a CVS receipt.
Still confused? Call the Michigan Department of Licensing and Regulatory Affairs. I know, I know, calling government offices isn’t fun, but their people actually know what they’re talking about.
Navigating Local Municipal Requirements
This is where things get personal—literally. Every city, county, and township can have different rules. Grand Rapids might require something that Detroit doesn’t care about.
Here’s my tried-and-true approach:
Call your local clerk’s office. I’m serious. It takes five minutes and can save you months of headaches. Ask specifically:
- “Do you require a general business license for all businesses?”
- “Are there specific permits for my type of business?”
- “What’s the application process and timeline?”
Most local clerks are surprisingly helpful—they want businesses to succeed and follow the rules.
Michigan Sales Tax: The Permit You Probably Need
If you’re selling physical products to Michigan customers, you’ll need a Michigan sales tax license. This isn’t optional—it’s mandatory.
The good news? Getting one is straightforward through the Michigan Department of Treasury. The bad news? Sales tax compliance is ongoing work, not a one-and-done situation.
Here’s what triggers the requirement:
- Selling products to consumers in Michigan
- Having sufficient economic presence in the state (even from out of state)
- Certain services (the rules get wonky here)
Reality check: Sales tax rules change faster than fashion trends. If you’re selling products, consider using a service like TaxJar to handle the compliance piece. Your sanity is worth the monthly fee.
Federal Licenses: Probably Not Your Problem
I’m going to save you some time here. Unless your business involves:
- Transportation across state lines
- Firearms or explosives
- Broadcasting or telecommunications
- Commercial fishing or hunting
- Aviation
- Alcohol production or distribution
- Nuclear materials (seriously hoping this doesn’t apply to you)
…you probably don’t need a federal license.
What you DO need federally:
- An EIN (Employer Identification Number) for your LLC
- To file taxes properly
- To follow employment laws if you hire people
That’s it. Keep it simple.
The Real Cost of Michigan Business Licenses
“How much will this cost me?” is always the first question I hear. The answer I hate giving: it depends.
State-level industry licenses can range from under $100 to several thousand dollars (looking at you, certain healthcare professions). Local permits might be $25 or $500. It varies wildly.
Here’s what I tell every client: budget for licensing costs before you launch. Nothing kills startup momentum like discovering you need a $2,000 professional license you didn’t know about.
Common Michigan License Mistakes I See All the Time
After helping over 1,000 businesses launch, these are the mistakes that keep popping up:
Mistake #1: Assuming “online business” means “no licenses needed” Reality: If you’re selling products, you probably need a sales tax permit. If you’re providing professional services, check for licensing requirements.
Mistake #2: Only checking state requirements
Reality: Local requirements can be just as important and expensive.
Mistake #3: Thinking an LLC registration equals a business license Reality: These are completely different things. Your LLC is your business structure; licenses give you permission to operate.
Mistake #4: Waiting until after launch to research licenses Reality: Some licenses take weeks or months to obtain. Plan ahead.
Your Michigan License Action Plan
Here’s your step-by-step roadmap (I’ve refined this over hundreds of client consultations):
Week 1: Research Phase
- Use Michigan’s online license search for your industry
- Call your local municipal office
- List all potential requirements and costs
Week 2: Application Phase
- Gather required documents (you’ll need your LLC info, EIN, etc.)
- Submit applications (start with the longest-processing requirements first)
- Set up sales tax registration if needed
Week 3: Follow-Up Phase
- Check application statuses
- Respond to any requests for additional information
- Plan for renewal dates (yes, most licenses expire)
When to Hire Professional Help
I’m all for DIY when it makes sense, but sometimes you need backup. Consider hiring help if:
- Your industry has complex licensing requirements
- You’re operating in multiple municipalities
- You’re not sure which licenses apply to your specific situation
- The penalty for getting it wrong is severe (hello, healthcare and finance folks)
Services like IncFile offer business license research for around $99. Whether that’s worth it depends on your time, complexity, and stress tolerance.
Staying Compliant: The Ongoing Game
Getting your licenses is just the beginning. Most licenses require:
- Annual renewals (with fees)
- Continuing education (for professional licenses)
- Updated information when your business changes
- Additional permits for new activities
Set calendar reminders for renewal dates. I’ve seen too many businesses get shut down for expired licenses—it’s easily preventable but surprisingly common.
The Bottom Line
Michigan makes business licensing relatively painless compared to some states. No general business license requirement keeps costs down, and their online resources are actually useful.
But—and this is important—”relatively painless” doesn’t mean “ignore it and hope for the best.” Do your homework, budget for the costs, and build compliance into your business operations from day one.
Your future self will thank you when you’re running a successful, legally compliant Michigan LLC instead of scrambling to fix problems after the fact.
Ready to Get Your Michigan LLC Licensed Right?
Need help figuring out your specific licensing requirements? I’ve built my reputation on giving entrepreneurs the real story—no upsells, no fluff, just the facts you need to launch smart.
Visit llciyo.com for more Michigan LLC guides, or reach out if you need personalized guidance. Because starting a business is hard enough without guessing about licensing requirements.
Jake Lawson has guided over 1,200 entrepreneurs through U.S. business formation and compliance. He’s tested every major formation service, called out the fine print others ignore, and believes every founder deserves straight-shooting advice. No affiliations, no upsells—just the truth about launching your business right.