While Michigan does not require a single, general business operating license for companies doing business in the state, many businesses must obtain at least one kind of business license or permit from the state before conducting business. For example, businesses selling tangible products will need a license to collect the appropriate sales and use tax.
Additionally, while businesses don’t need a general state business license, many local municipalities in Michigan will require licenses and permits depending on where the business operates and/or the industry the business operates within.
When Do You Need a Business License in Michigan?
When beginning a new business in the state of Michigan, you will likely need at least one, if not two to three business licenses from the local, state and/or federal levels before opening your doors. The majority of local municipalities, cities or unincorporated areas of counties do not require a general business operating license but do require professional licensing for certain occupations and industries.
The city of Detroit provides a lengthy list of all those businesses required to obtain a specialty license including amusement parks, dry cleaners, gas stations, hotels, pet shops, restaurants and sports stadiums, to name a few. To determine if your business needs a professional license in Detroit, or any other city in Detroit, visit the website of your city clerk or county recorder.
Similarly, the state of Michigan does not require business licenses for all businesses but does require certain types of businesses and professions to obtain licensing. The list of required licenses includes a number of health-related professions such as acupuncturists, optometrists, pharmacists and social workers as well as a few other industries such as construction, cosmetology and alcoholic beverage sales.
Additionally, any company engaged in business in Michigan intending to sell or lease tangible personal property ordinarily subject to retail sales tax will be required to obtain a sales tax license. This license allows Michigan businesses to collect the appropriate sales tax on items sold or leased.
Finally, your business may be required to obtain federal licensing to operate legally. Though federal licenses are rarer, they are required for businesses operating in certain highly regulated industries.
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