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Why choose an LLC business structure in Michigan

Did you know that 99.6% of Michigan’s businesses are small, and more than 48% of employees work for these companies? If you are like most people, you may have considered starting a business at some point.

However, if you are like some of the most successful people, you have done research, fleshed out your products and developed a business plan, but you may need more information on corporate structures. Therefore, these are reasons you may choose to open an LLC in Michigan.


Partnerships and sole proprietorships have pass-through taxation, while corporations can experience dual taxation on corporate profits and have to fill out separate taxes for the business and owners. A limited liability company (LLC) has pass-through taxation. However, if you have more than one member, you do need to file company taxes. Fortunately, taxation occurs when profits pass to you and the other members and you pay what you owe. You can report both profits and losses on your personal income tax.


Oftentimes, sole proprietorships and partnerships struggle with credibility, especially if they do not separate their personal and business finances. However, you could find it difficult to gain financing, especially from investors, with these structures. Fortunately, the LLC structure gives you added creditability, giving you increased access to financing and investment.

Personal liability

The LLC business structure separates your personal and business assets, finances and legal liabilities. Therefore your creditors cannot take your personal assets to pay business debts. Also, if your company gets sued and you lose, the other party only has access to your corporate finances and assets.

These are only a few reasons to start an LLC in Michigan. Do your due diligence and learn all the advantages and disadvantages of this corporate structure.