Q: I am filing in Michigan. Specifically for e-commerce, do I need a seller’s permit?
Thank you to Trent of Aventus Athletics (Instagram, TikTok, Facebook) in Michigan for that great question! We often receive questions about seller’s permits, especially for e-commerce businesses. In most cases, yes, you will need a seller’s permit (or what Michigan calls a sales tax license) for your business, even if you conduct online sales. Continue reading below to find out how to get a sales tax license in Michigan:
What is a Michigan Sales Tax License?
A sales tax license (called a seller’s permit in some states) is a document that shows your business is registered with the Michigan Department of Treasury. Registering with the Department of Treasury is necessary for most Michigan LLCs or Michigan Corporations conducting taxable sales or purchases in Michigan.
Is a sales tax license the same as a business license?
Not necessarily. Business license is a pretty broad term. In Michigan, as in most states, businesses may be required to obtain several licenses before they are authorized to conduct sales in the state. For example, you may need:
- Health and/or safety permits
- Professional license(s)
- Local business license(s) required by your city or county
How can I find out what business licenses I need in Michigan?
Use this State License Search to find out what additional licenses and/or permits your business might need. And if you work in a licensed profession (i.e. medicine, engineering, accountancy, etc.), you can visit the state’s Professional Licensing page to read more about the licenses and/or permits required by your professional industry. Any information about local licenses or permits can be found through your city or state clerk’s office.
Who needs a Michigan Sales Tax License?
According to MI Comp L § 205.53, a license is required of any business that makes retail sales in Michigan. Though there are some exceptions, most businesses are expected to pay the state’s six-percent sales tax.
Are there any businesses that don’t need a Michigan Sales Tax License?
It depends on the nature of your business, but there are certain types of sales that may not require you to pay taxes on goods exchanged. For example, certain sales to nonprofit organizations, restaurants, or the agricultural industry may be exempt from sales tax (see: MI Comp L § 205.54a).
And in general, selling items in bulk or purchasing wholesale often does not require sales tax, so long as you qualify for, and claim sales tax exemption status using Form 3372.
How do I get a Michigan Sales Tax License?
The easiest way to get your sales tax license in Michigan is online. (This is also the state’s preferred method.) Simply following the steps outlined on this New Business Registration page. Alternatively, you may fill out Form 518 by hand and mail your application to:
Michigan Department of Treasury
P.O. Box 30778
Lansing, MI 48909
Can I obtain my Michigan Sales Tax License over the phone?
No. You may only apply for a sales tax license in Michigan online or by mail.
What does it cost to get a Michigan Sales Tax License?
Nothing. Getting a sales tax license in Michigan is free!