Michigan does not require a special state cleaning license. You need to register your business with the Michigan Department of Licensing and Regulatory Affairs. You also need a local business license and state tax registration.
Detroit and Grand Rapids have different local requirements. This guide covers every license, permit, and tax step you need.
What Licenses Do You Need for a Cleaning Business in Michigan?
Michigan has no state license just for cleaning businesses. But you still need several registrations to operate legally.
Here is what every Michigan cleaning business needs:
- Business registration — register your business name with the state
- Local business license — most cities and counties require one
- Sales tax license — register with the Michigan Department of Treasury
- Employer Identification Number — required if you hire workers or form a limited liability company
- Insurance — general liability coverage protects you and your clients
Sole owners can start with just a few forms. The process is simple and mostly online.
How Do You Register Your Business in Michigan?
You register through the Michigan Department of Licensing and Regulatory Affairs. The steps depend on your business type.
Sole Proprietorship
This is the simplest option. You file an assumed name certificate with your county clerk. The filing fee is about $10.
You do not need to file with the state. Your county handles everything.
Limited Liability Company
A limited liability company protects your personal assets. You file Articles of Organization with the state. The filing fee is $50.
You can file online through the Michigan Department of Licensing and Regulatory Affairs website. Processing takes one to seven business days.
Steps to Register
- Choose your business name — check the state database for name availability
- Pick your business structure — sole proprietorship or limited liability company
- File your paperwork — county clerk or state filing depending on your structure
- Get your Employer Identification Number — apply for free on the Internal Revenue Service website
- Register for state taxes — sign up through Michigan Treasury Online
- Get your local business license — contact your city or township clerk
Need help with all the startup steps? Read our full guide on how to start a cleaning business in Michigan. It covers everything from setup to finding your first clients.
What Taxes Do Cleaning Businesses Pay in Michigan?
Michigan has several taxes that apply to cleaning businesses. Here is what you need to know.
Sales Tax
Michigan charges a 6 percent sales tax. Residential cleaning is generally not taxable. Commercial cleaning may be taxable depending on the contract details.
Register with the Michigan Department of Treasury to get a sales tax license. There is no fee to register.
Income Tax
Michigan has a flat state income tax rate of 4.25 percent. You pay this on your business profits. Some cities also charge a local income tax.
Detroit charges a 2.4 percent city income tax. Grand Rapids charges 1.5 percent. Most other cities do not have a local income tax.
Federal Taxes
You also pay federal income tax on your profits. Self-employed workers pay a 15.3 percent self-employment tax. This covers Social Security and Medicare.
If you hire workers, you must withhold federal taxes from their pay. You also pay employer payroll taxes.
What Insurance Is Required for Cleaning Businesses in Michigan?
Insurance protects your business from accidents and lawsuits. Michigan law requires some types of insurance.
General Liability Insurance
This is the most important coverage. It pays for damage you cause to a client's property. It also covers injuries that happen during a job.
Most cleaning businesses pay $400 to $800 per year. The cost depends on your revenue and number of workers.
Workers' Compensation Insurance
Michigan law requires workers' compensation if you have one or more employees. This covers medical bills and lost wages if a worker gets hurt on the job.
Independent contractors do not count as employees. But be careful with how you classify workers. Michigan has strict rules about this.
Other Insurance to Consider
- Commercial auto insurance — covers your vehicle while driving to jobs
- Bonding — protects clients if an employee steals from their home
- Umbrella policy — adds extra coverage above your other policy limits
Learn more about coverage options in our cleaning business insurance guide. It covers policy types, costs, and how to choose the right provider.
Do You Need an Employer Identification Number in Michigan?
An Employer Identification Number is a federal tax number for your business. The Internal Revenue Service assigns it for free.
When You Need One
You need an Employer Identification Number if you:
- Hire employees — required for payroll taxes
- Form a limited liability company — needed for your tax filings
- Open a business bank account — most banks ask for one
- Have a partner — partnerships must have one
When You Do Not Need One
Sole owners with no employees can use their Social Security number. But getting one is still a good idea. It keeps your personal number private.
How to Apply
Apply online on the Internal Revenue Service website. The process takes about 10 minutes. You get your number right away.
There is no fee. Never pay a third-party service for this. It is always free from the Internal Revenue Service.
What Are Local Permit Requirements in Major Michigan Cities?
Each city in Michigan has its own rules. Some cities need more permits than others. Check with your local clerk for exact requirements.
| City | Business License | Local Income Tax | Special Notes |
|---|---|---|---|
| Detroit | Required | 2.4% | Apply through the City of Detroit website |
| Grand Rapids | Required | 1.5% | Zoning approval may be needed for home offices |
| Ann Arbor | Required | None | Register with the city clerk |
| Lansing | Required | 1% | State capital has extra business rules |
| Flint | Required | 1% | Apply at the city treasurer's office |
| Kalamazoo | Required | None | Register with the city clerk's office |
Always check with your specific city or township. Rules can change. Some areas also require a home occupation permit if you run your business from home.
How Much Do Michigan Cleaning Business Licenses Cost?
Starting a cleaning business in Michigan is affordable. Here is a breakdown of all the costs.
| Item | Cost | Frequency |
|---|---|---|
| Assumed Name (sole proprietorship) | $10 | One time |
| Limited Liability Company filing | $50 | One time |
| Local business license | $25 to $200 | Annual |
| Employer Identification Number | Free | One time |
| Sales tax license | Free | One time |
| General liability insurance | $400 to $800 | Annual |
| Workers' compensation insurance | $500 to $1,500 | Annual |
| Limited liability company annual report | $25 | Annual |
A sole owner with no employees can start for under $500. A limited liability company with employees costs $1,000 to $2,500 in the first year.
What Are the Renewal and Compliance Deadlines?
Keeping your business legal means meeting deadlines. Here are the key dates to remember.
| Task | Deadline | Details |
|---|---|---|
| Limited liability company annual report | February 15 each year | File online with the state for $25 |
| Local business license renewal | Varies by city | Most cities renew annually or every two years |
| Sales tax returns | Monthly, quarterly, or annual | Frequency depends on your sales volume |
| Federal tax return | April 15 each year | File with the Internal Revenue Service |
| Michigan income tax return | April 15 each year | File with the Michigan Department of Treasury |
| Insurance policy renewal | Varies by policy | Most policies renew every 12 months |
Set reminders for each deadline. Missing a deadline can lead to fines or a lapsed license. Use a calendar to track every due date.
Now that your licenses are sorted, set competitive prices. Read our Michigan cleaning business pricing guide to learn what to charge in your area.