Michigan LLC vs Pennsylvania LLC (2026)
Written for owners based in Michigan.
Verdict: for most owners, form where the business is based
Pennsylvania's annual report costs $7, comfortably under Michigan's $25 on February 15. Formation is the expensive half at $125 against $50, so year one runs $132 against $75, and by year five Pennsylvania is $160 against $175. The report itself is new: a 2022 Pennsylvania law replaced the old decennial filing with a September 30 deadline every year from 2025, and associations that miss the report due in 2027 face administrative dissolution six months later. A Pennsylvania LLC pays $50 to register in Michigan.
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Compare Michigan LLC vs Pennsylvania LLC on filing fees, taxes, privacy laws, and annual costs. Find out which state is actually better for your business.
By Edmond Hui · Last updated: October 5, 2026
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| Factor | Michigan | Pennsylvania |
|---|---|---|
| Filing Fee | $50 | $125 |
| Processing Time | Not published by the state | 2 to 4 days |
| Annual Report Fee | $25 | $7 |
| Annual Report Due | February 15 | September 30 |
| State Income Tax | Yes | Yes |
| Anonymous LLC | Yes | No |
| Publication Requirement | No | No |
| Foreign LLC Cost (if forming out-of-state) | N/A, you're in your home state | $50 + registered office provider (est. ~$150/yr) |
Full fee breakdown for either state: Michigan LLC cost and Pennsylvania LLC cost. Owner privacy options for either state: Michigan anonymous LLC guide and Pennsylvania anonymous LLC guide.
Business Climate: Michigan vs Pennsylvania
| Factor | Michigan | Pennsylvania |
|---|---|---|
| 5-year business survival rate | 55% (#4 of 51) | 57.1% (#1 of 51) |
| Business application growth (2026 YTD (Jan to Jul) vs 2025 YTD (same months)) | +17.3% YoY (#11 of 51 by volume) | +6.5% YoY (#12 of 51 by volume) |
Sources: U.S. Bureau of Labor Statistics, Business Employment Dynamics · U.S. Census Bureau, Business Formation Statistics (BFS)
Compare LLC Costs: Michigan vs Pennsylvania
Michigan
Pennsylvania
A figure shown as "from" is the least the state can charge, not a price. Tennessee's report is $300 for up to six members and $50 for each member above six, its franchise tax is the greater of $100 or 0.25% of Tennessee net worth, Wyoming's report is the greater of $60 or $.0002 per dollar of in-state assets, Kentucky's entity tax is $175 up to $3 million of gross receipts and graduated above it, and New York's annual filing fee is graduated on New York source gross income. A total that contains one of those is shown as "from" for the same reason. Costs include every mandatory state charge: the filing fee, the report fee (annualised where a state files biennially), any state entity-level tax shown in its own row above, a one-time publication cost where the state publishes a rate for it, and any one-time registration charge a state requires before the LLC may trade. Two exclusions follow from that wording. Arizona and Nebraska require publication and publish no rate, so no newspaper cost is carried for either and their totals are not the whole cost. Alaska's $50 annual state business licence is a separate charge from the Secretary of State fees and is not carried here either. Annualising makes the 1, 3 and 5 year rows a cost of ownership rather than a payment schedule: a biennial state charges its whole report fee in the years it falls due and nothing in between. Entity-level taxes that only apply after a corporate election, or above an owner or income threshold, are excluded and flagged on the state's own cost page. New York's publication cost is carried at a $250 floor, roughly $200 of newspaper cost in a low-cost county plus the $50 Certificate of Publication fee. No county-clerk-designated New York City newspaper publishes a rate card, so the four-figure NYC estimates in wide circulation cannot be traced to a primary source and are not asserted here; budget for materially more than the floor if you file in a NYC county. Every fee was verified against the state's own fee schedule, statute, or revenue authority on 29 July 2026. Excludes registered agent and legal fees. For informational purposes only, not legal or tax advice.
Filing Fees & Formation Costs
Michigan charges $50 to form an LLC, while Pennsylvania charges $125. Michigan is $75 cheaper upfront. The cost that usually gets overlooked: if you form in Pennsylvania but operate in Michigan, you must also register as a foreign LLC in Michigan (a $50 filing) and keep a Pennsylvania registered office, usually through a commercial registered office provider (we budget about $150 a year; providers set their own fees). That puts the realistic first-year cost of the Pennsylvania route at roughly $325, versus $50 for simply forming in Michigan. Only one side of this comparison is knowable: Pennsylvania publishes a standard turnaround (2 to 4 days), while Michigan publishes no standard processing time, so the two can't be ranked against each other on speed.
Taxes: Michigan vs Pennsylvania
Both Michigan and Pennsylvania levy a personal income tax on pass-through business income, and your LLC's profits will be taxed where you live and operate. Forming in Pennsylvania doesn't change what a Michigan-based owner pays. Michigan levies a flat 4.25% individual income tax; Treasury confirmed on April 15, 2026 that the rate remains 4.25% for the 2026 tax year because the statutory rate-reduction trigger wasn't met. Pennsylvania levies a flat 3.07% personal income tax. Neither state imposes a separate franchise or privilege tax on LLCs beyond standard filing fees.
Privacy & Asset Protection
Michigan, your home state, actually offers more formation privacy than Pennsylvania: Michigan allows anonymous LLC formation, while Pennsylvania requires owner or manager information on public filings. Pennsylvania's annual report names at least one governor (a member or manager with management responsibility). Both states provide charging-order protection for LLC members, and for most small businesses the practical difference in asset protection between the two is minimal. From a privacy standpoint there's no reason for a Michigan-based business to form in Pennsylvania.
Annual Maintenance Costs
Michigan LLCs file an annual report ($25, due February 15), and Pennsylvania LLCs file an annual report ($7, due September 30). If you form in Pennsylvania while operating in Michigan, you maintain filings in both states, Pennsylvania's report plus Michigan's equivalent for your foreign registration, and pay a Pennsylvania commercial registered office provider, which we budget at about $150 a year (providers set their own fees, and another Pennsylvania street address also works). Counting report fees, the provider and any entity-level tax, that brings the Pennsylvania route to roughly $182 a year, versus about $25 to keep a domestic Michigan LLC in good standing.
When Pennsylvania Actually Makes Sense
Forming in Pennsylvania makes sense in a few specific situations: your business genuinely operates in Pennsylvania, with a real office, employees, or property there, or you're relocating to Pennsylvania in the near future. For a typical small business based in Michigan, none of these usually apply. Registering a Pennsylvania LLC to do business back home means $50 in Michigan foreign-registration fees, on top of Pennsylvania's $125 formation fee, while Michigan's own annual report runs $25 a year and is due February 15. Michigan already allows anonymous formation, so the privacy argument for Pennsylvania doesn't apply to a Michigan-based owner. When in doubt, form where you actually do business.
Frequently Asked Questions
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Sources
Each entry below is a document recorded in our verified sources, and each entry says what the document is. Some statutory text is read from an accurate mirror rather than from the state's own host, and those say so. Where we hold the citation but no stable public link, the citation is printed on its own rather than pointed at a guessed address.
- Pennsylvania law: Act 122 of 2022 (annual report replaces decennial filing)
- michigan.gov/lara/bureau-list/cscl/corpsMichigan Department of Licensing and Regulatory Affairs, Corporations Division: business entity filings
- michigan.gov/-/media/Project/Websites/lara/cscl/Folder6/Filing_Fees.pdfMichigan LLC filing fees
- pa.gov/agencies/dos/programs/businessPennsylvania Department of State, Bureau of Corporations and Charitable Organizations: business entity filings
- pa.gov/agencies/dos/programs/business/fees-and-paymentsPennsylvania LLC filing fees
Edmond Hui · Founder, MyStateLLC
Edmond Hui is a software engineer and serial entrepreneur based in New York who has founded multiple online businesses across e-commerce, media, and information publishing. Before transitioning into tech, he spent years as a commercial real estate professional closing deals totaling over 100,000 square feet, giving him firsthand experience with business formation and entity structuring. He built MyStateLLC to provide the free, state-specific LLC guidance he wished existed when forming his own companies.