Single-Member LLC in Michigan (2026)

Fact-checked by the LegalGlass editorial team against primary sources · Published Aug 6, 2026 · Last updated Aug 6, 2026

A Michigan single-member LLC (SMLLC) is a one-owner LLC formed by filing Articles of Organization (Form CD-700) with the Department of Licensing and Regulatory Affairs (LARA) for a $50 fee. By default the IRS treats it as a disregarded entity - taxed on the owner's personal return - while still giving the owner a liability shield. Michigan requires a $25 annual statement each year.

Quick Answer

Formation document: Articles of Organization (Form CD-700)
Filing fee: $50 to LARA
Agency: Michigan Dept. of Licensing and Regulatory Affairs (LARA)
Default tax status: Disregarded entity (Schedule C on owner's 1040)
Annual statement: $25, due February 15 each year
Liability: Owner's personal assets shielded if formalities kept

What a Single-Member LLC Is in Michigan

A single-member LLC is a limited liability company with exactly one owner. In Michigan it is formed the same way as any LLC - by filing Articles of Organization with LARA - but because it has one member, the IRS gives it a distinct default tax treatment. Legally, it is a separate entity from its owner, which is what provides the liability shield a sole proprietorship lacks. For the national overview see single-member LLC.

The appeal of an SMLLC is that it combines the simplicity of solo ownership with liability protection. The owner controls the business entirely, yet business debts and lawsuits generally reach only the LLC's assets, not the owner's home and savings - provided the owner respects the entity by keeping finances separate and following formalities. Michigan LLCs are governed by the Michigan Limited Liability Company Act.

How to Form a Michigan Single-Member LLC

Forming the SMLLC takes the same steps as any Michigan LLC:

Choose a name that includes an LLC designator and is distinguishable in the LARA business database.
Appoint a resident agent with a Michigan registered office.
File Articles of Organization (Form CD-700) with LARA and pay the $50 fee, online or by mail.
Get an EIN from the IRS.

Once LARA accepts the Articles, the LLC legally exists. See how to form an LLC in Michigan and Michigan Articles of Organization for the full detail, including name reservation and expedited options.

SMLLC vs. Sole Proprietorship and Multi-Member LLC

Against a sole proprietorship, the single-member LLC's advantage is liability protection. Both are taxed the same way by default - profit on the owner's Schedule C with self-employment tax - so the SMLLC adds a shield without changing the tax return. The cost is the $50 formation fee, the $25 annual statement, and the discipline of keeping the entity separate. For most owners with any liability exposure, that trade is worth it.

Against a multi-member LLC, the difference is federal tax classification: a multi-member LLC defaults to partnership taxation and files Form 1065, while the SMLLC is disregarded and files on the owner's 1040. Adding a member - even a spouse in most cases - converts the LLC to a partnership for tax purposes and changes the filing. Both types can elect S-corp treatment. Choosing single- versus multi-member is therefore as much a tax decision as an ownership one.

How a Single-Member LLC Is Taxed

By default, the IRS treats a single-member LLC as a disregarded entity under 26 CFR § 301.7701-3. That means the LLC is ignored for federal income tax and its activity is reported on the owner's Form 1040, usually on Schedule C. The owner pays income tax and 15.3% self-employment tax on the net profit, just like a sole proprietor - but with the liability protection of an LLC.

The SMLLC can instead elect to be taxed as a corporation or S corporation by filing the appropriate IRS form, which can reduce self-employment tax above a certain profit level. For Michigan, income passes through to the owner's Michigan individual return, taxed at the state's flat individual income tax rate. If the LLC sells taxable goods or has employees, it registers with the Michigan Department of Treasury for sales, use, and withholding accounts. See Michigan LLC tax filing.

EIN and Bank Account

A single-member LLC with no employees can technically use the owner's Social Security number for income tax, because it is disregarded. In practice, almost every SMLLC should get an EIN - it is free from the IRS and is required to hire employees, elect corporate or S-corp taxation, or pay certain excise taxes. Banks also typically require an EIN to open a business account.

Opening a separate business bank account is one of the most important steps for an SMLLC. Commingling personal and business money is a leading reason courts disregard the liability shield ("piercing the veil"). Keeping a dedicated account, paying business expenses from it, and documenting any money you move between yourself and the LLC preserves the separation that protects your personal assets.

Operating Agreement and Formalities

Michigan does not require an SMLLC to have an operating agreement, and you do not file one with LARA, but a written operating agreement is still valuable for a solo owner. It documents that the LLC is a separate entity, records how the business is managed and how the owner takes distributions, and can set succession terms if the owner dies or becomes incapacitated. That paper trail strengthens the liability shield.

Beyond the agreement, maintaining the entity means observing basic formalities: signing contracts in the LLC's name, keeping business and personal finances separate, and maintaining adequate records. These habits are what make the legal separation real. Because a single-member LLC has no co-owners to enforce discipline, the owner has to impose it - but the payoff is meaningful protection that a sole proprietorship never provides.

Staying Compliant in Michigan

Michigan requires every LLC to file an annual statement each year to stay in good standing. The statement is filed with LARA, carries a $25 fee, and is due by February 15. Missing it can eventually lead LARA to place the LLC in default and, if prolonged, to dissolve it administratively. Keeping a current resident agent is also mandatory. See Michigan annual report for the filing details.

Ongoing compliance is otherwise light: file and pay federal and Michigan taxes on time, renew any licenses your activity requires, and update LARA if your agent or address changes. If you ever wind the business down, file a Certificate of Dissolution and settle taxes - see how to dissolve an LLC in Michigan. Compared with the protection it provides, the maintenance burden of a Michigan SMLLC is modest.

Frequently Asked Questions

How much does it cost to form a single-member LLC in Michigan?

The Articles of Organization (Form CD-700) filing fee is $50, paid to LARA. After that, Michigan charges a $25 annual statement each year. An EIN from the IRS is free.

How is a Michigan single-member LLC taxed?

By default it is a disregarded entity: profit is reported on the owner's Form 1040 (Schedule C) and taxed with self-employment tax. It can elect corporate or S-corp taxation. Michigan taxes the profit on the owner's individual return.

Does a Michigan single-member LLC need an EIN?

Not strictly for income tax, since it is disregarded, but it needs one to hire employees, elect S-corp status, or open a business bank account. The EIN is free, so most owners get one.

Does a single-member LLC protect my personal assets in Michigan?

Yes, if you respect the entity. The LLC shields personal assets from business debts, but commingling funds or ignoring formalities can let a court pierce the veil, so keep finances separate.

What annual filing does a Michigan LLC have?

A $25 annual statement filed with LARA, due February 15 each year. Missing it can put the LLC in default and eventually lead to administrative dissolution.

More Michigan business guides

Form An Llc In Business License In Dissolve An Llc In Annual Report Articles Of Organization Dba Filing Llc Tax Filing Operating Agreement Registered Agent Business Entity Search

Sources

Michigan LARA - Limited Liability Companies (Form CD-700; formation).
Michigan LARA - annual statement ($25; due Feb 15).
IRS - Single Member Limited Liability Companies (disregarded entity).
IRS - Limited Liability Company (LLC) (default federal tax classification).
Legal Information Institute - 26 CFR § 301.7701-3 (entity classification election).
IRS - Get an Employer Identification Number (EIN) (free; one per responsible party per day).
Michigan Department of Treasury - business taxes registration.
Michigan Legislature - Michigan Limited Liability Company Act (Act 23 of 1993).
IRS - About Schedule C (Form 1040) (sole proprietor profit or loss).
IRS - Self-Employment Tax (Social Security and Medicare Taxes) (15.3% rate).
IRS - About Form 8832, Entity Classification Election.
Legal Information Institute - Limited liability company (LLC).
IRS - State Government Websites (state tax and business links).

LegalGlass provides general information for educational purposes and is not a law firm or a substitute for advice from a licensed attorney or tax professional. Laws, fees, and thresholds change; verify current requirements with the Michigan Department of Licensing and Regulatory Affairs (LARA) and Michigan Department of Treasury before acting.