According to the Michigan Limited Liability Company Act, an LLC’s term of operation is unlimited unless otherwise specified in the operating agreement or by the articles of incorporation. The LLC is regarded as a perpetual entity if no time frame is given. LLCs must submit an annual report to the Michigan Department of Licensing and Regulatory Affairs (LARA) along with the required fee in order to keep their active status.
Keep your LLC in good standing at all times to prevent fines and other legal repercussions. Michigan LLCs can check their status by going to the LARA website and using their company name as a search term. The status of the LLC, including whether it is active, inactive, or dissolved, will be shown on the website. The most recent annual report filing date and the deadline for the subsequent report are also displayed.
For tax purposes, a Subchapter S Corporation (S Corp) is a type of corporation that avoids double taxation by passing through all profits and losses to shareholders. The IRS will tax S Corps in 2021 at the shareholder’s personal tax rate, which ranges from 10% to 37% based on the shareholder’s income. What is the CIT Rate at the Moment?
Corporations operating in Michigan are subject to the Corporate Income Tax (CIT), which is a tax on corporate income. In Michigan, the CIT rate is now 6%. What Will the Corporation Tax Rate Be in 2021?
In conclusion, unless the operating agreement or articles of formation specify a specific duration, LLCs in Michigan may function indefinitely. To stay in good standing, LLCs must submit an annual report to the Michigan Department of Licensing and Regulatory Affairs. Visit the LARA website and enter your company name in the search bar to determine the status of your LLC. The S Corp tax rate for 2021 is also based on individual income tax rates, but the Michigan CIT rate for the current tax year is 6% and the corporate tax rate for 2021 is 21%.
When establishing a S corporation, it’s crucial to pick a name that stands out from other company names that have already been registered in your state. The words “Incorporated,” “Inc.,” or “Corporation,” or an abbreviation of one of these phrases, should be included in your name in accordance with the naming regulations of your state. Additionally, you might want to think about selecting a name that both accurately describes your company’s operation and is simple for clients to recall. Before settling on a name for your company, it is a good idea to check for similar names that are not currently in use.