SERVING MICHIGAN FROM DETROIT TO GRAND RAPIDS · SINCE 2005
Michigan Bookkeeping Services
Last Updated: October 6, 2026Michigan is refreshingly simple at state level and complicated underneath it. Sales tax is a flat 6% statewide with no local add-ons — one of the few states where a single rate genuinely applies everywhere, which removes an entire category of error. The complication is municipal: around two dozen Michigan cities levy their own income tax, Detroit among them, with separate rates for residents and non-residents and employer withholding obligations attached. Add the annual statement due with the state each February and a flat state income tax, and Michigan rewards a business that keeps its payroll records straight far more than one that watches sales-tax rates.
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Michigan owners and their CPAs come to us because city income tax withholding depends on where people live and work — a payroll records question, not a tax one. Dedicated bookkeepers, monthly reconciliations, and tax-ready financials — plans from $75/month, extra hours at $15/hour, and wholesale $10/hour rates for CPA firms — backed by a 100% money-back guarantee on your 1st retainer, refundable on the unused balance.
On This Page
- Michigan’s small-business tax landscape
- One sales-tax rate, statewide — a genuine advantage
- City income tax and the withholding question
- The 15 February annual statement
- Michigan cities we serve
- Michigan FAQs
Michigan’s Small-Business Tax Landscape
| Tax / Filing | Rate / Fee | Deadline |
|---|---|---|
| Sales and use tax | 6% flat statewide, with no county or city add-ons | Monthly, quarterly or annually, by assignment |
| Individual income tax | Flat-rate state income tax — confirm the current rate with Treasury | Annually, with estimated payments |
| Corporate income tax | Michigan Corporate Income Tax on C corporations | Annually, with estimated payments |
| City income tax | Around two dozen Michigan cities levy their own, including Detroit, Grand Rapids, Lansing and Flint, typically with different resident and non-resident rates | Annual returns plus employer withholding on the city’s schedule |
| Annual statement (LLC) | Filed with LARA to keep the entity in good standing | 15 February each year |
Michigan Department of Treasury and Department of Licensing and Regulatory Affairs, checked 3 October 2026. City income tax rates are set locally and change — confirm your city’s rates and your filing obligations with the city or your CPA.
One Sales-Tax Rate, Statewide — a Genuine Advantage
Michigan charges 6% sales tax and that is the whole story. No county rates, no city rates, no special districts, no destination-sourcing puzzle within the state. For a Michigan business selling to Michigan customers, the rate is 6% wherever the customer is.
It is worth appreciating how unusual that is. Colorado businesses deal with dozens of self-collecting cities; Washington sellers face hundreds of local rates; Arizona varies by city and classification. Michigan removes all of it.
What remains is the ordinary discipline: tax collected has to be reconciled against tax remitted every month, exempt sales have to be documented, and refunds have to reverse the tax as well as the sale. Those go wrong at 6% exactly as easily as at a variable rate — they are just easier to fix.
City Income Tax and the Withholding Question
Around two dozen Michigan cities levy a local income tax, and the structure usually distinguishes between residents and non-residents, with non-residents taxed on income earned within the city at a lower rate.
For an employer, that turns payroll into a records problem. The correct withholding for an employee depends on where they live and where the work is performed, and both can change without anyone filing a form — a move across a city line, a shift to hybrid working, a role that becomes field-based. Set withholding once at hire and never revisit it, and it quietly drifts out of correctness.
We record payroll from actual runs, capture work location, and keep each city’s liability in its own account reconciled to what was remitted. What is owed to whom is a question for your CPA or the city; our job is making sure the ledger can answer it. Payroll processing is $50 per run plus $10 per employee.
The 15 February Annual Statement
Michigan LLCs file an annual statement with LARA by 15 February. The fee is modest and the filing takes minutes, which is exactly why it slips — it falls in the gap between year-end close and tax season, when nobody is looking at compliance admin.
The consequence of missing it is not immediate. The entity drifts out of good standing, and that surfaces later at a bank, in due diligence, or when a customer asks for a certificate — always at a worse moment than February would have been.
Keeping a filing calendar alongside the books is part of the service, not an extra.
Michigan Cities We Serve
Dedicated local guide: Detroit — plus Grand Rapids, Warren, Sterling Heights, Ann Arbor, Lansing and Flint, and every corner of the state, all served remotely. Browse all locations.
Michigan Bookkeeping FAQs
What is the sales tax rate in Michigan?
6%, flat, statewide. Michigan does not permit county or city sales-tax add-ons, so the same rate applies everywhere in the state. That removes the destination-rate complexity that dominates sales-tax compliance in states like Colorado, Washington and Arizona.
Which Michigan cities have an income tax?
Around two dozen, including Detroit, Grand Rapids, Lansing, Flint, Saginaw and Pontiac. Rates are set locally and usually differ between residents and non-residents. If you have employees working in one of those cities, you generally have a withholding obligation there. Confirm the specifics with the city or your CPA.
Do you handle Michigan city withholding?
We handle the bookkeeping that it depends on: payroll run and recorded accurately, work location captured, each city tracked in its own liability account, and those accounts reconciled monthly against what was actually remitted. We are not a CPA firm and do not determine which city is owed what.
When is the Michigan annual statement due?
15 February each year, filed with LARA. It is separate from any tax filing and it keeps the entity in good standing. Missing it rarely causes immediate trouble, which is why it is so often missed — the problem shows up later at a loan closing or during due diligence.
Do you have offices in Michigan?
No, and we would rather say so plainly than imply otherwise. We are a fully virtual bookkeeping company — founded in Vienna, Virginia on May 25, 2005 and headquartered in San Juan, Puerto Rico today, US-registered with delivery centers in India, which we disclose on our About page. We have served Michigan businesses remotely since 2005. You get a dedicated bookkeeper with plans from $75/month, monthly reconciliations, and a 100% money-back guarantee on your 1st retainer, refundable on the unused balance.
Related Resources
Great Lakes Grit, Ledger-Clean Books
Dedicated Michigan bookkeeping from $75/month — with a 100% money-back guarantee on your 1st retainer, refundable on the unused balance.