Apply for a Michigan Tax ID (EIN) Number
To obtain your Tax ID (EIN) in Michigan start by choosing the legal structure of the entity you wish to get a Tax ID (EIN) for. Once you have submitted your application your EIN will be delivered to you via e-mail.
Who Needs an EIN
You will need a Tax ID (EIN) in Michigan if you:
- Have employees
- Operate your business as a Corporation or Partnership
- Operate as Trust, Estate or Non-Profit Organization
- File Tax Returns for Employment, Excise or Alcohol, Tabacco and Firearms
When starting a business in Michigan, there are a number of federal and state tax requirements that you will have to meet. In an effort to help you make sense of the complexities of the bureaucratic process, the guide below will walk you through all the necessary requirements.
Michigan has a variety of different taxes that you will be required to satisfy as a business owner – and requires all businesses to have both a federal employer identification number (FEIN) and a state-specific Employer Account Number, which is issued by the Michigan Unemployment Insurance Agency. This number is known as a UIA Employer Account Number.
Michigan Business Registration
Step one, you will have to choose the type of business you are forming in Michigan. Your options include:
- Sole Proprietorship – The most common business structure, a sole proprietorship applies when a single individual engages in business without setting up a formal or corporate business structure.
- General Partnership – When two or more people carry on business together, they are a general partnership.
- Corporation – A corporation exists separately from the business’s owners. The owners become shareholders, and if they actively run the business, they are also referred to as directors.
- S-Corporation – an S-corporation is a corporation that has made an election to be taxed as an S-corporation by the IRS.
- Limited Liability Company (LLC) – A hybrid between a corporation and a sole proprietorship, an LLC is its own entity with its own liability for most debts and legal issues.
Obtaining a Federal Tax ID (EIN) Number
A federal tax ID is also known as a Employer Identification Number, or FEIN. A FEIN is used to identify the company as an entity in and of itself.
You require a Federal Tax ID (EIN) Number if any of the circumstances below apply:
- Your business employs people
- You are applying for a business loan
- You are opening a business bank account
- You have a Keogh plan
- Your business operates as a corporation or partnership
- You file tax returns for Excise, Employment, or Alcohol, Tobacco, and Firearms
- You withhold taxes on income, other than wages, that are paid to a non-residential alien
Michigan State Tax ID Number
A state tax ID, like a FEIN, is used to identify your business as an individual entity. It is also used to monitor tax compliance. In Michigan, the state tax ID is a nine-digit number known as the Unemployment Insurance Agency (UIA) Employer Account Number. Businesses need a UIA in order to apply for certain loans and local licenses/permits.
UIA Employer Account Numbers are issued by the Michigan Unemployment Insurance Agency, by the Department of Talent and Economic Development. You can apply online.
Primary uses of a Michigan State Tax ID:
- Sales/Use Tax – Sales taxes are paid by all businesses that sell or lease tangible property. Use tax is paid by the consumer when they buy or lease tangible property. Your Michigan state ID tax is used to track these taxes.
- Withholding Tax – All employers are required to withhold money on behalf of their employees for tax purposes. If the employer does not withhold this money, and the tax goes unpaid, then the employer is liable. Your state tax ID is used to trace withholding tax payments and requirements.
Michigan Local Licenses and Permits Overview
Not all businesses are required to be additionally licensed in Michigan. Whether or not your business requires additional licensing depends on the nature of your business and the goods or services that you provide.
Michigan Sales Tax Permit
You must obtain a sales tax permit if you sell “tangible personal property” in Michigan. You can apply online at the Michigan's Department of Treasury.
Here's a few examples of industry-specific permits you will be required to obtain. Not all of these apply to tax, but you will need them to operate legally in Michigan. Here's a few examples:
- Restaurants – You will require a Food Service License and, if selling alcohol, a license from the Michigan Liquor Control Commission.
- Construction – All residential builders are required to be licensed by the Department of Licensing and Regulatory Affairs.
- Electricians – All persons completing electrical work must be licensed by the State Electrical Administrative Board.
- Acupuncturist – All acupuncturists must be registered with the Board of Acupuncture at the Department of Licensing and Regulatory Affairs.
The number of businesses that require additional licenses and/or permits is long, so check with the Department of Licensing and Regulatory Affairs to find the exact requirements for your company.