Forming a company in Nevada while doing business in Michigan

Forming in another state does not remove a business that operates in Michigan from Michigan law. A foreign LLC or corporation that transacts business in Michigan must obtain a certificate of authority, keep a Michigan registered office and resident agent, and file annual reports here, and Michigan taxes and Michigan courts can still reach it.

This page covers only what Michigan requires of a company formed outside Michigan. It does not describe or compare the law of the state of formation, which a lawyer licensed in that state would have to explain. Michigan's rules for a company formed elsewhere are the same whichever state it is: a foreign LLC must obtain a certificate of authority before transacting business in Michigan (MCL 450.5002), and a foreign corporation shall not transact business in Michigan until it has procured one (MCL 450.2011). Each statute lists activities that alone do not count as transacting business, such as maintaining a bank account or defending a lawsuit, and each says the list does not decide which contacts subject a company to service of process, taxation or other regulation in Michigan (MCL 450.5008; MCL 450.2012).

A certificate of authority puts the company on the same footing as a Michigan company, not a better one. A foreign LLC holding a certificate has no greater rights or privileges than a domestic LLC (MCL 450.5003(3)), and a foreign corporation with a certificate has the same rights and privileges as a domestic corporation and is subject to the same duties, restrictions, penalties and liabilities as a similar domestic corporation (MCL 450.2002(1)). Michigan does leave a foreign LLC's organization and internal affairs to the law of the state where it was organized (MCL 450.5001), and the Business Corporation Act does not authorize Michigan to regulate the internal affairs of an authorized foreign corporation (MCL 450.2002(2)).

The practical result is an additional layer, not a substitute. The company registers in Michigan in addition to its home-state formation, with its own fees and annual filings. The Michigan fee statutes set $50 for a foreign LLC's application for a certificate of authority and $10 for a foreign corporation's (MCL 450.5101(1)(n); MCL 450.2060(1)(b)). Questions about what the other state requires or offers should go to a lawyer licensed there, and questions about Michigan registration, taxes and lawsuits turn on what the business actually does in Michigan.

Authority: MCL 450.5002; MCL 450.2011; MCL 450.5008; MCL 450.2012; MCL 450.5003; MCL 450.2002; MCL 450.5001; MCL 450.5101; MCL 450.2060. Reviewed Oct. 2026.

The answer depends on the purpose. Michigan's registration statutes list activities that alone are not transacting business, but they do not decide who can be sued or taxed in Michigan. Courts read the long-arm phrase transaction of any business broadly, and Michigan's corporate income tax uses its own nexus rules.

For registration, a foreign LLC or corporation is not considered to be transacting business in Michigan solely because it maintains or defends a proceeding, holds internal meetings, maintains bank accounts, sells through independent contractors, takes orders that require acceptance outside Michigan, owns property without more, conducts an isolated transaction completed within 30 days, or engages in interstate commerce (MCL 450.5008(1); MCL 450.2012(1)). The lists are not exclusive, and each section says it does not apply in determining the contacts that may subject a company to service of process, taxation or regulation under other Michigan laws (MCL 450.5008(2); MCL 450.2012(2)).

For lawsuits, Michigan's long-arm statute gives courts limited personal jurisdiction over a corporation for claims arising out of the transaction of any business within the state, among other relationships (MCL 600.715(1)), and general jurisdiction over a corporation that carries on a continuous and systematic part of its general business in Michigan (MCL 600.711(3)). In Oberlies v Searchmont Resort, Inc, the Court of Appeals held that "even the slightest transaction is sufficient to bring a corporation within Michigan's long-arm jurisdiction," and that a nonresident corporation's advertising can be the transaction of business where it targets Michigan residents and leads directly to business relationships with them. Due process still applies: the defendant must have purposefully availed itself of Michigan, the claim must arise from its Michigan activities, and the connection must be substantial enough to make jurisdiction reasonable. The resort in Oberlies won because the plaintiff's injury at its Ontario facility was too attenuated from its Michigan advertising. The jurisdiction statutes name individuals, corporations, partnerships and associations and do not mention LLCs, so how they apply to an LLC can be argued in a particular case.

For the Michigan corporate income tax, substantial nexus exists if the taxpayer has a physical presence in Michigan for more than 1 day during the tax year, actively solicits sales in Michigan and has $350,000 or more of gross receipts sourced to Michigan, or holds an ownership or beneficial interest in a flow-through entity that has substantial nexus in Michigan (MCL 206.621(1)). A company can therefore be doing business for one purpose and not another, and the location of employees, inventory, customers, contracts and the owner's own work all matter.

Authority: MCL 450.5008; MCL 450.2012; MCL 600.715; MCL 600.711; Oberlies v Searchmont Resort, Inc, 246 Mich App 424 (2001); MCL 206.621. Reviewed Oct. 2026.

Usually the Michigan resident does. Michigan taxes a resident individual on income from any source, and its starting point is federal adjusted gross income. The LLC itself can also be taxed in Michigan if it has Michigan nexus and is taxed as a corporation or elects entity-level tax, so forming elsewhere does not by itself change the Michigan result.

A Michigan resident is an individual domiciled in Michigan, and an individual who lives in Michigan at least 183 days during the tax year is deemed a resident (MCL 206.18(1)(a)). For a resident individual, all taxable income from any source whatsoever, except income attributable to another state under the statute's allocation rules, is allocated to Michigan (MCL 206.110(1)). The tax is levied on the taxable income of every person other than a corporation for receiving, earning or otherwise acquiring income from any source whatsoever (MCL 206.51(1)). For an individual, Michigan taxable income starts from adjusted gross income as defined in the Internal Revenue Code (MCL 206.30(1)), and an LLC is a flow-through entity under the income tax act (MCL 206.12(1)). Whether the LLC's profit is included in the owner's adjusted gross income depends on the LLC's federal tax classification, which this answer does not address. The state of formation is not a factor in these sections.

The LLC can also face Michigan tax of its own. The corporate income tax is levied at 6.0% of the apportioned tax base on every taxpayer with business activity in Michigan or an ownership interest in a flow-through entity that has business activity in Michigan (MCL 206.623(1)). A taxpayer under that tax is a corporation, meaning a person required or electing to file as a C corporation (MCL 206.605(1); MCL 206.611(5)), so an LLC taxed as a corporation is within it if it has nexus under MCL 206.621(1). A flow-through entity that elects under the flow-through entity tax is itself a taxpayer (MCL 206.809(3); MCL 206.811(1)).

This answer covers Michigan income taxes only. Sales and use tax, payroll taxes, property taxes and federal income tax are separate, and the tax result for a particular business turns on its federal classification, where its activity occurs and how the owner reports it.

Authority: MCL 206.18; MCL 206.110; MCL 206.51; MCL 206.30; MCL 206.12; MCL 206.623; MCL 206.605; MCL 206.611; MCL 206.621; MCL 206.809; MCL 206.811. Reviewed Oct. 2026.

The Michigan fee statutes set $50 for a foreign LLC's application for a certificate of authority and $10 for a foreign corporation's. A foreign LLC then files an annual statement by February 15 and a foreign corporation files an annual report by May 15, each costing $25 through September 30, 2027 and $15 if paid after that date.

To register, a foreign LLC files an application for a certificate of authority with a $50 fee (MCL 450.5101(1)(n)), and a foreign corporation files an application with a $10 fee (MCL 450.2060(1)(b)). A foreign corporation must attach a certificate of good standing from the official in its home state who has custody of corporate records, dated not earlier than 30 days before the application is filed (MCL 450.2016(1)), and the statute refers to any franchise fees prescribed by law in addition to the filing fee (MCL 450.2016(2)). The fee statutes say fees are not refundable (MCL 450.5101(3); MCL 450.2060(2)). Changing the Michigan registered office or resident agent is a $5 filing for either type (MCL 450.5101(1)(i); MCL 450.2060(1)(k)), and withdrawing from Michigan is a $10 filing (MCL 450.5101(1)(q); MCL 450.2060(1)(h)).

After registration, a foreign LLC must file an annual statement giving the name of its resident agent and the address of its registered office, due not later than February 15 each year, except that an LLC authorized after September 30 need not file on the next February 15 (MCL 450.4207(3); MCL 450.5005(3)). A foreign corporation must file an annual report with the administrator no later than May 15, signed by an authorized officer or agent, listing its name, resident agent and registered office, its president, secretary, treasurer and directors, and the general nature of its business, and a corporation authorized between January 1 and May 15 does not file for that year (MCL 450.1911). The LLC annual statement fee and the corporate annual report fee are each $25 through September 30, 2027 and $15 if paid after that date (MCL 450.5101(1)(g); MCL 450.2060(1)(u)).

Missing the annual filings has consequences. A foreign LLC that fails to file for 2 consecutive years is notified and, if it does not catch up within 60 days, loses good standing until it files a certificate of restoration with a $50 fee (MCL 450.4207a; MCL 450.5101(1)(h)). A foreign corporation that neglects its annual report or fee for 1 year is subject to revocation of its certificate of authority after at least 90 days' notice (MCL 450.1922(2); MCL 450.2041; MCL 450.2042). The cost of forming and maintaining the company in its home state is set by that state and is not covered here. These figures come from the statutes as they read in October 2026, so confirm the current fee schedule before filing.

Authority: MCL 450.5101; MCL 450.2060; MCL 450.2016; MCL 450.4207; MCL 450.5005; MCL 450.1911; MCL 450.4207a; MCL 450.1922; MCL 450.2041; MCL 450.2042. Reviewed Oct. 2026.

Often yes. A Michigan court can exercise jurisdiction over an out-of-state company that transacts business in Michigan, subject to due process, and an authorized foreign LLC is served through its Michigan resident agent. Michigan's statutes look to the law of the state of organization for a foreign LLC's internal affairs, but the Court of Appeals held in Daystar that this does not strip a Michigan court of power to hear the case.

Service on a foreign LLC authorized in Michigan is made on its Michigan resident agent (MCL 450.4207(1), (2)). If the company has no agent, or the agent cannot be found or served through reasonable diligence, a plaintiff may serve the administrator (MCL 450.4207(4)). A foreign LLC that transacts business in Michigan without a certificate of authority appoints the administrator as its agent for service on claims arising out of that business (MCL 450.5007(4)). Service rules do not decide jurisdiction: the court rule says its provisions are not intended to limit or expand the jurisdiction of Michigan courts, which is governed by the United States Constitution and Michigan's constitution and laws (MCR 2.105(K)(1)).

Jurisdiction over the company depends on its contacts. Michigan's long-arm statutes reach a corporation for claims arising from the transaction of any business within the state (MCL 600.715(1)), and the Court of Appeals applies a due process test under which the defendant must have purposefully availed itself of Michigan, the claim must arise from its Michigan activities, and the connection must make jurisdiction reasonable (Oberlies v Searchmont Resort, Inc). The statutes name corporations, individuals, partnerships and associations and do not mention LLCs, so how they apply to an LLC can be argued in a particular case.

For disputes among the owners, Michigan's statute provides that the laws of the jurisdiction under which a foreign LLC is organized govern its organization and internal affairs (MCL 450.5001). In Daystar Seller Financing LLC v Hundley, a trial court dismissed claims involving foreign entities for lack of subject-matter jurisdiction under the internal-affairs doctrine, and the Court of Appeals reversed. It held that "neither Wojtczak nor the internal-affairs doctrine deprived the court of jurisdiction to adjudicate the parties' claims," explaining that the doctrine is a choice-of-law principle that guides a court's discretion to decline jurisdiction, and that claims for money damages for past conduct did not require the court to manage a foreign entity's internal affairs. A written agreement can also choose the forum. If the parties agreed in writing that an action may be brought in Michigan and that agreement is the only basis for jurisdiction, a Michigan court must entertain it when the statute's conditions are met, including that Michigan is a reasonably convenient place for trial and the agreement was not obtained by misrepresentation, duress or other unconscionable means. If they agreed it must be brought only in another state, the court must dismiss or stay the action unless a listed exception applies (MCL 600.745).

Authority: MCL 450.4207; MCL 450.5007; MCR 2.105; MCL 600.715; Oberlies v Searchmont Resort, Inc, 246 Mich App 424 (2001); MCL 450.5001; Daystar Seller Financing LLC v Hundley, 326 Mich App 31 (2018); MCL 600.745. Reviewed Oct. 2026.

Owning Michigan real estate through an out-of-state LLC does not, by itself, require a Michigan certificate of authority, because owning property without more is not transacting business. The land is still taxed in Michigan, and who owns it affects the tax: the principal residence exemption speaks of individuals, and a deed into an LLC, or a sale of more than 50% of the LLC, can count as a transfer of ownership that resets taxable value.

The registration statutes list owning, without more, real or personal property as an activity that alone is not transacting business (MCL 450.5008(1)(i); MCL 450.2012(1)(i)). The section adds that the list does not decide what subjects a company to service of process, taxation or other regulation (MCL 450.5008(2); MCL 450.2012(2)), so an LLC that rents, develops or operates the property may be doing more than owning it. For title, a conveyance of an interest in land must be in a deed or other writing signed by the party conveying (MCL 566.106), and an unrecorded conveyance is void against a later good-faith purchaser for value whose conveyance is first recorded (MCL 565.29). Those rules apply the same way whether the grantee is an individual or an LLC.

For property tax, real property includes all land in Michigan and the buildings on it (MCL 211.2(1)(a)). The principal residence exemption defines "person" as an individual for its purposes and does not list limited liability companies among the owners (MCL 211.7dd(a), (b)), so a home titled in an LLC raises a question about whether the exemption is available that should be raised with the local assessor. Taxable value is capped, but upon a transfer of ownership the taxable value for the following year becomes the state equalized valuation (MCL 211.27a(3)). A conveyance by deed is a transfer of ownership, and so is a conveyance of an ownership interest of more than 50% in an LLC, in which case the entity must notify the assessor within 45 days (MCL 211.27a(6)(a), (h)). The statute lists exceptions, including transfers among commonly controlled entities (MCL 211.27a(7)), so each transfer should be checked against that list.

For income tax, net rents and royalties from real property located in Michigan are allocable to Michigan (MCL 206.111(1)). The answer for a specific property depends on how it is held, used and conveyed, and the deed, the LLC records and the assessor's file should be reviewed together.

Authority: MCL 450.5008; MCL 450.2012; MCL 566.106; MCL 565.29; MCL 211.2; MCL 211.7dd; MCL 211.27a; MCL 206.111. Reviewed Oct. 2026.

Not until it obtains a certificate of authority, if it was transacting business in Michigan without one. Michigan bars a foreign LLC or corporation in that position from maintaining a lawsuit here, but the bar is not permanent, its contracts remain valid, and it can still defend a lawsuit.

A foreign LLC transacting business in Michigan without a certificate of authority shall not maintain an action, suit or proceeding in a Michigan court until it obtains one, and the prohibition reaches its successors and assignees, with exceptions for receivers, trustees in bankruptcy, and assignees for value who took without knowing a certificate was needed (MCL 450.5007(1)). A foreign corporation is treated the same way (MCL 450.2051(1)). If the company obtains a certificate before the order of dismissal, the action is not dismissed, and any dismissal is without prejudice to refiling after it obtains the certificate (MCL 450.5007(2); MCL 450.2051(1)). The failure does not impair the validity of any contract or act of the company or prevent it from defending a lawsuit (MCL 450.5007(3); MCL 450.2051(2)).

The bar applies only to a company that is transacting business in Michigan. Securing or collecting debts and enforcing mortgages and security interests are listed among the activities that alone are not transacting business (MCL 450.5008(1)(h); MCL 450.2012(1)(h)), so whether a company that is simply collecting a debt needs a certificate depends on what else it does in Michigan.

The consequences of transacting business without a certificate reach beyond the lawsuit. A foreign LLC is liable to the state for the fees it would have paid, owes a civil penalty of $100 to $1,000 for each calendar month, capped at $10,000, and each manager, member or authorized person who authorizes, directs or participates in the Michigan business is subject to a civil penalty of up to $10,000 (MCL 450.5007(5), (6)). A court that finds a violation must also enjoin further Michigan business until the penalties are paid and a certificate is obtained (MCL 450.5007(7)). A member is not liable for the LLC's debts solely because the LLC transacted business here without a certificate (MCL 450.5007(8)). A foreign corporation faces a penalty of $100 to $1,000 per month, not to exceed $10,000 (MCL 450.2055).

Authority: MCL 450.5007; MCL 450.2051; MCL 450.5008; MCL 450.2012; MCL 450.2055. Reviewed Oct. 2026.

A foreign LLC or corporation withdraws from Michigan by applying for a certificate of withdrawal, which requires stating that it is not transacting business in Michigan and surrenders its authority, with a $10 filing fee. A company that falls behind on annual filings can instead lose good standing or have its certificate of authority revoked.

A foreign LLC authorized in Michigan may withdraw by applying for a certificate of withdrawal. The application states the company's name and jurisdiction of organization, that it is not transacting business in Michigan, and that it surrenders its authority. It also revokes the authority of its resident agent to receive service and consents to service on the administrator for any claim arising in Michigan while it was authorized, and it gives an address for the administrator to mail process (MCL 450.5006(1)). A foreign corporation applies in a similar way, and when the certificate of withdrawal issues its authority to transact business in Michigan ceases and its resident agent's authority to accept service is revoked (MCL 450.2031; MCL 450.2032). The filing fee is $10 for either type (MCL 450.5101(1)(q); MCL 450.2060(1)(h)).

Withdrawal does not wipe out Michigan claims. The foreign LLC's consent to service on the administrator covers claims arising in Michigan during the time it was authorized (MCL 450.5006(1)(d)), and the application must supply the information the administrator needs to determine and assess any unpaid fees (MCL 450.5006(1)(f)).

Falling behind has its own path. A foreign LLC that fails to file its annual statement for 2 consecutive years and does not cure within 60 days of the administrator's notice is not in good standing, cannot obtain a certificate of good standing and cannot make most filings, though it remains in existence and may continue to transact business in Michigan. It can file a certificate of restoration of good standing with the missing statements and fees and a $50 fee (MCL 450.4207a; MCL 450.5101(1)(h)). A foreign corporation that neglects its annual report or fee for 1 year is subject to revocation of its certificate of authority, which requires at least 90 days' notice and a failure to cure, and a certificate of revocation has the same force as a certificate of withdrawal (MCL 450.1922(2); MCL 450.2041; MCL 450.2042).

Authority: MCL 450.5006; MCL 450.2031; MCL 450.2032; MCL 450.5101; MCL 450.2060; MCL 450.4207a; MCL 450.1922; MCL 450.2041; MCL 450.2042. Reviewed Oct. 2026.