Home > business, business law, Real Estate, startups > Reminder to Michigan Limited Liability Companies: Maintain your Corporate Formalities and Keep up your Guard.

Reminder to Michigan Limited Liability Companies: Maintain your Corporate Formalities and Keep up your Guard.

Occasionally I will have a business client come in and I will ask – just to make sure – “is your business still in good standing?”

The common answer is “I think so.”

And of course, after I perform a quick internet check with the State of Michigan it is all too common that I discover that either the LLC is “not in good standing” or worse, the company has been dissolved automatically for failure to file annual statements.

This morning I received an e-mail reminder from the Michigan Department of Licensing and Regulatory Affairs (LARA)

LLC owners are reminded that 2016 annual statements are being mailed to resident agents.

A Word on Resident Agents:

This is that time of the year that my office is inundated with such statements. We are happy to provide our business clients with resident agent services. One of the benefits of an LLC is that it provides its owners a level of privacy protection.

Michigan law requires Limited Liability Companies to have appointed a Resident Agent.

MCL 450.4207(1)(b) requires an LLC to have a resident agent. A person, or business with a physical presence in the State of Michigan.

Michigan law does not require that an “owner” of the LLC be the resident agent.

“The resident agent appointed by a limited liability company is an agent of the company upon whom any process, notice, or demand required or permitted by law to be served upon the company may be served.” MCL 450.4207(1)(b).

Many of my real estate investment clients will utilize my law firm as resident agent when filing their articles of organization with the State of Michigan.

Per LARA’s announcement:

“Annual statements and reports must be filed no later than February 15 of each year and can be filed online at www.michigan.gov/fileonline.”

Consequences for Failing to File:

if an LLC “fails to file its annual statement/report and filing fee for two years, the limited liability company will not be in good standing. The status of the limited liability company will be “active, but not in good standing.””

Further,

an LLC “not in good standing is not entitled to a certificate of good standing; its company name will be available for use by another entity, and no document will be filed on behalf of the company other than a certificate of restoration.”

By the Numbers:

“There are a total of 419,315 LLCs and 12,199 PLLCs that are receiving 2016 statements (LLCs) and statements and reports (PLLCs).”

In Conclusion:

Business owners, if you get these annual statements from the State of Michigan, or from your attorney – do not disregard them! Maintain your Corporate Formalities.

Questions? Comments?

E-mail: Jeshua@dwlawpc.com

http://www.dwlawpc.com

Twitter: @JeshuaTLauka

Advertisements
  1. No comments yet.
  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: