Comparing Nevada and Michigan LLC: Which State is Right for You?

Location is one of the key things to consider when starting a business, as it determines your chances of success and the costs of maintaining your start-up.

Each state has its own advantages and disadvantages. More benefits mean more chances of success. If you want your business to thrive, opting for an environment that could help you achieve your goals is best.

Deciding which state is ideal for your business isn’t easy. But we’re here to help as we’ve compared the benefits of starting an LLC in Michigan vs. Nevada.

Find out why the Silver state should be your top choice with our quick guide.

Does Not Recognize Series LLCs

A Series LLC is a unique limited liability company where you can gather your venture’s assets, membership interests, and operations into various independent entities. Series LLCs offer full liability protection.

This means assets owned by one series are not at risk of the liabilities of other series within the same series LLC. You don’t need to set up new entities as the risk is set apart within the different series.

Take, for example, a food business that creates a series LLC to separate its various operations: a cafe, pastry shop, and sandwich deli. While they’re under the same company, liabilities endured by one shop aren’t experienced by the others. Take, for instance, an outbreak of rat infestation or food poisoning.

Series LLCs are an excellent strategy to protect your personal assets. However, Nevada may be the better option in this case, as incorporating your business in Michigan means you won’t benefit from these protections.

Annual Report Filing

LLC owners in Michigan and Nevada don’t have to pay estate tax, but they do require a federal estate tax, depending on your estate’s size.

In Michigan, the state requires all LLCs to file an annual report which is due February 15 annually. The Department of Licensing and Regulatory Affairs will send the statement form 90 days before the due date.

This document contains up-to-date information about the resident agent and your business. It also comes with a $25 filing fee.

Business Court

Some states don’t have a business court to facilitate timely and effective resolutions of complex business cases. This will result in a more difficult time settling disputes with your shareholders.

Michigan has a business court that expedites all business concerns and handles shareholder disagreements.

Other Federal Requirements

Business owners can choose to have their LLC taxed as a C-corporation at the federal level. Meaning the LLC will pay a flat 21% federal corporate income tax.

Apart from federal corporate income tax, business owners in Michigan must cover their Social Security and Medicare obligations by paying the federal self-employment tax. This includes paying the employer's share of their employee’s taxes.

Moreover, an employer must have a federal unemployment tax, which can be reduced if you pay it in full and on time. You may need a federal employer identification number to file your federal taxes.

Want to Know More? Speak With Nevada's Best LLC & Business Formation Company

As Nevada’s leading business formation service provider, NCH has a team of specialists that provides you with all the support you need to kickstart your business. We’ll assist you in finding the right entity for your start-up and explore the difference between incorporating in Utah and Nevada.

Our commitment goes beyond managing paperwork. As your trusted advisor, we provide expert support in different areas, such as tax compliance, credit building, and payroll management. Enjoy peace of mind with a team of professionals working with you by your side.

We also offer business formation services to make the incorporation process easier. We’ll help you find a business license and a registered agent to manage your legal documents.

You can also maximize our private consultation services for your tax and other legal concerns. Our experts work with you to develop effective strategies to minimize tax liabilities and preserve your wealth.

Incorporate your business in Nevada and unleash its full potential today!