Starting an accessories shop in Armada, MI: which licenses and registrations do I need?

Heather wrote: “I am a maker of handmade rosaries planning to sell on Etsy. I will be selling nationwide online and in person at craft fairs.”

Hi Heather, Prayer Is Powerful is an exciting name to see on a new business in Armada. Pop-up stands and online stores let you test trends fast and restock the bestsellers. Here is what we will cover: how to structure Prayer Is Powerful, the tax IDs it needs, and the licenses that let you open in Armada, then a quick recap.

Etsy collects Michigan sales tax on its orders, but at a craft fair the collecting is yours, so a Michigan sales tax license is the piece you need before your first table, and fair organizers often ask to see it. Prayer Is Powerful needs an assumed name on file, since it isn't your legal name, and that filing opens a business bank account. Nationwide online sales don't trigger other states' taxes until your volume there crosses each state's threshold. With one employee, register as a Michigan employer. The click of beads on a table is a good sound at a fair.

What Prayer Is Powerful needs

1. LLC (business structure) – Forming an LLC puts a legal wall between the business and your personal assets. A shopper who trips over your pop-up rack at a festival may sue, but an LLC means your home is not what they can collect from.
2. DBA (doing business as) registration – Most banks will not open an account or deposit checks made out to "Prayer Is Powerful" until the name is registered to you, either as a DBA or as the exact name of your LLC.
3. EIN (federal tax ID number) – You plan on 1 employee, so the federal tax ID number (EIN) is required for payroll, and you will also use it for the business bank account and supplier accounts.
4. Michigan sales tax permit (seller's permit) – You will be selling taxable goods, so register to collect sales tax before your first sale. It also lets you buy inventory for resale without paying tax on it.
5. Michigan employer ID – With 1 employee, you need a state employer account number for payroll withholding and unemployment insurance. It works like the EIN, but for state payroll taxes.
6. Business license – Most places require a local business license to operate, including home-based businesses. Check the rules where Prayer Is Powerful will operate in Armada, and ask about home occupation and zoning rules if you work from home. Home occupation rules commonly cap client visits and delivery trucks on a residential street, so read them before you print business cards.

By the numbers: Banks, insurers, and tax forms will ask for your industry code. For an accessories shop it is NAICS 448150 (Clothing Accessories Stores), 458110 under the 2022 update. With 1 employee planned, you are already creating jobs in Armada. That makes 6 items on your list.

Tip: Learn which products, such as smoking accessories, have age or local sales limits.

To recap: Prayer Is Powerful in Armada, MI needs an LLC, a DBA, an EIN, a sales tax permit, a state employer ID, and a business license. With the paperwork done, the fun part begins: serving your first customers.

BusinessNameUSA can prepare and file these registrations for you: start your order.