Incorporate in Michigan for FREE^*

Incorporation is the process of registering a business as a corporation and making it recognizable under law as its own legal entity. Incorporating a business can be a complicated process because each state has its own requirements for registering and operating a business as a corporation. Knowing the necessary steps and forms, however, will help keep you organized and stress-free. 

With our easy business registration service, you simply answer a few questions and we create your initial paperwork and file it with the state for you. The first business entity registration is free for Rocket Legal+ members—you pay only the state filing fees. Then, you can make and personalize all the legal documents you need for your business. Store everything online in your Rocket Lawyer account.

What is a C-Corp? 

A C-Corp, or C-Corporation, is a common business entity type. More specifically, a C-Corp is a corporation taxed under Subchapter C of the U.S. Code. Under Subchapter C, corporations are subject to tax at both the corporate and individual level (sometimes called “double taxation”). Depending on the situation, this may result in lower or higher tax burdens for the shareholders. 

C-Corps allow for anyone to be an investor and for an unlimited number of shareholders and multiple share classes.

As with other types of corporations, C-Corporations provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. Except for certain instances of fraud or misconduct, a shareholder is not liable for the debts or obligations of a corporation beyond the shareholder's investment into the corporation.

Corporations are treated as a C-Corp by default, unless another type of tax treatment is selected, such as an S-Corp.

What is an S-Corp? 

Like C-Corps, S-Corps provide a common and well-known legal structure for businesses and offer their shareholders some limited liability. However, S-Corps have two main differences from C-Corps: they are taxed differently and they have more restrictions with shares.

An S-Corporation, or S-Corp, is an IRS election that allows a company to be treated like an LLC for income tax purposes, that is, as a “pass-through" entity. Instead of income taxes being owed at both the company and individual level, the income of an S-Corp is only taxed at the individual level, which means it passes through the company directly to the owners and shareholders. Again, this may result in lower or higher tax burdens for the shareholders depending on the situation.

S-Corps have more restrictions regarding shares and shareholders than C-Corps. Specifically, S-Corps can have no more than 100 shareholders, only one class of shares, and only U.S. residents or citizens as investors.

One area of common confusion is what type of entity can elect S-Corp status. Remember that this election is simply a tax choice, not a governance or legal structure choice. Both limited liability companies (LLCs) and corporations can choose S-Corp status if they qualify under the IRS's guidelines.

There are similarities between a Michigan S-Corp and a C-Corp regarding personal liability, management, structure, and compliance. The differences in Michigan, however, come down to the following:

• Ownership Rules: There are no limits on the number of shareholders or stock classes a C-Corp can have. An S-Corp, however, may have only one stock class and no more than 100 shareholders. All shareholders of an S-Corp must be citizens or legal residents of the United States.
• Taxes: A C-Corp is taxed separately from its shareholders. The business pays taxes on corporate earnings, and individual shareholders then pay taxes on dividends they have received. An S-Corp does not pay corporate taxes. It's a "pass-through" entity, which means all earnings pass through to the shareholders, who then pay taxes on their share of earnings.
• Documents: When you form a corporation, it is automatically a C-Corp. In order to become an S-Corp, you must file IRS Form 2553, Election by a Small Business Corporation. 

Your corporation’s name should be unique and make a statement about your business. Make sure it complies with the following Michigan requirements:

• The name must include the words "Company," "Corporation," "Incorporated," "Limited," or one of the abbreviations "Co," "Corp," "Inc," or "Ltd." You may use the abbreviations with or without periods.
• The name should not imply organization for any purpose other than what your business actually does. For example, if you sell appliances, don't call your company "Gemstones, Ltd."
• Companies that are not in the banking business cannot use words like "Bank" or "Security" in their names unless the rest of the name makes it clear that the business isn't in banking.
• Your name can't be the same as, or too similar to, a name already registered or reserved with the Secretary of State. 

Need help coming up with a business name for your corporation? Try the Rocket Copilot™ AI Business Name Generator, a free tool to help you brainstorm business names and get started registering your corporation.

Each state has its own personnel requirements for incorporating. In Michigan, your corporation must have at least one director. You don't have to list your directors in your Articles of Incorporation.

The state does not set any age requirements for directors or incorporators, nor does it require that directors live in the state.

Every corporation in Michigan must appoint a registered agent to be responsible for accepting tax, legal, and government documents on its behalf. Your agent must be available during regular business hours and must have a physical Michigan address. Post office boxes aren't acceptable. When you incorporate with Rocket Lawyer, we'll help you designate an agent. You must include your registered agent's name, physical address and mailing address—if it's different from the physical address—in your Articles.

Michigan also requires that you include the following information in your Articles of Corporation:

• The name of your corporation.
• The purpose of your corporation. It's acceptable to state that it will engage in any lawful business allowed under the Michigan Business Corporation Act.
• The total number of shares your corporation is authorized to issue.
• If the shares will be divided into classes, list the class designations and number of shares of each class.
• The name and address of each incorporator.
• If your corporation will have a defined end date, state that date.

You may also include other provisions, such as limitations on the powers of the corporation or its directors, or limits on a director's liability to the corporation.

Nearly every state has standard processing times, but not all provide expedited processing for corporations. In Michigan, there are a few fees that you may be charged when you register your business as a corporation. They include the following:

State fee: $60.

• Fee to expedite your filing: $110.

Rocket Lawyer filing fee: $0 $99.99.

• First filing FREE* for Rocket Legal+ members (excluding state fees).
• Get additional filings HALF OFF with Rocket Legal+.

Processing time: 7-10 business days.

•  Expedited processing time: 2 business days.

Note: The above state fees and processing times (including expedited processing fees and times) are provided as a summary and may or may not encompass various fees mandated by your state or local authorities. Your state may also change these fees and processing times over time and without notice. If you have questions, speak to a Rocket Lawyer Business Pro to understand the costs and processing times that apply to your specific filing.

Businesses can save up to $2,500 per year with a Rocket Legal+^™ membership. This calculation is based on total savings on an initial business registration and registered agent, trademark, and business tax filing services for Rocket Legal+ members (a total cost of $924.97) compared to Rocket Legal members (a total cost of $1,949.96). This is in addition to savings on the average cost of 5 hours for document preparation by a non-Rocket Lawyer network attorney at the average attorney hourly rate in the U.S. of $300 (an estimated cost of $1,500 when purchased without any form of Rocket Lawyer membership) compared to unlimited use of customizable business documents for both Rocket Legal+ and Rocket Legal members at no extra cost.

Yes – taxes are part of owning a business, so you'll have to pay them for your new corporation. One of the first things you'll need is an employer identification number, or EIN. You can apply for one with the IRS. This number is similar to a Social Security number, but it’s for businesses. Any corporation with employees needs one, and you should get yours before doing any business.

If you'd like to learn more about the tax structure of corporations, here's more information about S-Corps and C-Corps.

In order to maintain its corporate status, your business must also create and maintain other corporate records. The two major documents are bylaws and corporate minutes. Some states require Bylaws and Meeting Minutes, and others do not.

• Bylaws: A company's Bylaws define its structure and operating procedures. All provisions in your bylaws must be consistent with your Articles of Incorporation and with the law.
• Corporate Minutes: All corporations must hold annual shareholder and director meetings. The Meeting Minutes record all actions and decisions that occur in these meetings.

You don't need to file these documents with the state in Michigan, but you should keep them with your other corporate documents. Michigan allows corporations to store these documents outside the state.

We wish you success with your new Michigan corporation! You can count on Rocket Lawyer for all the business, tax, and legal help you need at a price you can afford. 

If you are planning to operate in another state, you may need to register a corporation in that state. Rocket Lawyer can help you determine which states you should register in.

Other states may have their own rules for foreign corporations that originate in Michigan or domestic corporations that also operate in Michigan. Talk to an attorney to understand the legal and tax requirements for the state(s) in which you plan to operate.