StructureCost2026

Michigan: what each business structure costs a year

At $100,000 profit, an LLC taxed as an S corp costs $4,845 a year less than a sole proprietorship in Michigan. All figures are 2026 tax and fees.

$4,845 a year

less as an LLC taxed as an S corp than as a sole proprietorship in Michigan, at these numbers. That includes the state's pass-through entity tax election.

More settings revenue, salary, filing status, payroll costs, PTET

Michigan, 2026: $100,000 profit, single filer

StructureYearly costvs yoursTo set up
Sole proprietorship yours $26,064 $0
Itemized: $26,064
Self-employment taxirs.gov, 2026 rates$14,130
Federal income taxirs.gov, 2026 rates$8,235
State income taxmichigan.gov, checked Oct 24, 2026$3,699
Yearly cost$26,064
Single-member LLC $26,080 +$16 $50
Itemized: $26,080
Annual Statementmichigan.gov, checked Oct 24, 2026$25
Self-employment taxirs.gov, 2026 rates$14,126
Federal income taxirs.gov, 2026 rates$8,231
State income taxmichigan.gov, checked Oct 24, 2026$3,698
Yearly cost$26,080
LLC taxed as an S corp lowest $21,219 −$4,845 $50
Itemized: $21,219
Annual Statementmichigan.gov, checked Oct 24, 2026$25
Payroll tax on your salaryirs.gov, 2026 rates$6,405
Payroll service and tax return (estimate)$1,800
Michigan pass-through entity tax, paid by the company (elected)miningjournal.net, checked Oct 24, 2026$2,330
Federal income taxirs.gov, 2026 rates$9,210
State income tax, after the PTET creditmichigan.gov, checked Oct 24, 2026$1,449
Yearly cost$21,219
S corporation $21,219 −$4,845 $60
Itemized: $21,219
Annual Reportmichigan.gov, checked Oct 24, 2026$25
Payroll tax on your salaryirs.gov, 2026 rates$6,405
Payroll service and tax return (estimate)$1,800
Michigan pass-through entity tax, paid by the company (elected)miningjournal.net, checked Oct 24, 2026$2,330
Federal income taxirs.gov, 2026 rates$9,210
State income tax, after the PTET creditmichigan.gov, checked Oct 24, 2026$1,449
Yearly cost$21,219
C corporation $30,538 +$4,474 $60
Itemized: $30,538
Annual Reportmichigan.gov, checked Oct 24, 2026$25
Payroll tax on your salaryirs.gov, 2026 rates$6,405
Payroll service and tax return (estimate)$2,000
State corporate income taxmichigan.gov, checked Oct 24, 2026$3,278
Federal corporate income tax (21%)irs.gov, 2026 rates$10,784
Federal income taxirs.gov, 2026 rates$4,873
State income taxmichigan.gov, checked Oct 24, 2026$3,173
Yearly cost$30,538
What these figures count
  • State income tax, and state taxes on the business itself: franchise, LLC, S corp, gross receipts and excise taxes.
  • Social Security and Medicare on both sides of an owner salary, federal unemployment tax and the state's new-employer rate.
  • The 20% qualified business income deduction with its income limits and the professional-service rule.
  • Yearly report fees, and a cost you can change for payroll and the business tax return.

Many S corp calculators leave out state taxes and the QBI deduction, which can make the election look better than it is.

When an S corp election pays in Michigan

Electing S corp tax treatment for an LLC starts to pay in Michigan at about $50,000 of profit, with the default salary and $1,800 a year for payroll and the extra tax return.

An S corp in Michigan can elect to pay the state's income tax itself, a pass-through entity tax of 4.25%, and the owner gets a credit for it. The company deducts it on the federal return, so it is not held to the SALT cap. The calculator uses it when it lowers the totalminingjournal.net.

ProfitSole propLLCLLC as S corpC corp
$30,000$6,115$6,134$7,585$8,077
$50,000$11,456$11,474$11,240$13,793
$75,000$18,207$18,226$14,600$21,017
$100,000$26,064$26,080$21,219$30,538
$150,000$43,281$43,298$35,577$51,246
$200,000$61,079$61,099$50,731$71,136
$300,000$103,967$103,975$83,547$112,268

Single filer, no other income, revenue taken as 1.5 times profit, default salary. The lowest cost in each row is marked.

State fees and taxes in Michigan

LLCCorporation
Filing to form$50Articles of Organization (CSCL/CD-700)$60Articles of Incorporation (CSCL/CD-500)michigan.gov
Yearly reportAnnual Statement, $25 a yearAnnual Report, $25 a yearmichigan.gov
Report dueFebruary 15 (first due the year after formation; LLCs formed after September 30 skip the first one)May 15 (starting the year after incorporation)

Not in the calculator: About 24 Michigan cities, Detroit among them, levy a city income tax on residents, nonresidents who work there, and businesses. Each city sets its own rates, so check the city where the business or its owner is.

Switching calculators for Michigan

By profession in Michigan

Questions

Is an S corp worth it in Michigan?

On these figures, from about $50,000 of profit. At $100,000 an LLC taxed as an S corp costs $21,219 a year against $26,080 for a plain LLC, $4,861 less. The saving comes from paying Social Security and Medicare tax on a salary instead of on all profit.

How much does an LLC cost per year in Michigan?

The state charges Annual Statement, $25 a year. Forming one costs $50.

Does Michigan recognise the S corp election?

Yes. The federal election carries over with no separate state form. Michigan follows the federal S election; S corps and LLCs taxed as partnerships are not subject to the corporate income tax.

What income tax does Michigan charge?

Michigan taxes personal income at a flat 4.25% (2026). C corporations pay 6% of net income.

How this page models Michigan (1)

Sources checked 2026-10-24. Each figure links to the state or IRS page it comes from.

Other states