Should I register my Etsy shop as a 'business' or an 'individual' if I have a Michigan LLC?

If you have an EIN and file taxes as a business entity (not a disregarded entity), register as a business. Etsy then verifies the entity name and EIN against IRS records, so the name has to match your Michigan Articles of Organization. A single-member Michigan LLC taxed as a disregarded entity can register as an individual and provide an SSN or ITIN.

What happens if I do not complete Etsy's seller verification?

Etsy withholds payouts until verification is complete, whichever state the shop's LLC comes from. If you miss the deadline shown in your Shop Manager dashboard, you have 90 days before the shop may be closed.

I do not live in Michigan. Can I still use a Michigan LLC on Etsy?

Etsy does not check where you live, only that the Michigan entity is validly registered and that the details you enter match Michigan's record. The catch is not Etsy, it is the state you actually operate from: states require an out-of-state LLC to register as a foreign LLC before it transacts business there, which is a second filing and a second fee on top of Michigan's $50. Forming in Michigan while working somewhere else usually means paying both states, not one.

Do I need a Michigan sales-tax permit before my first sale through Etsy?

Not for your Etsy orders themselves. Michigan charges a 6% state rate and, like every sales-tax state, has a marketplace-facilitator law that makes Etsy collect and remit it for you. You need your own Michigan registration once you also sell off-marketplace and either have physical presence in Michigan or cross its remote-seller threshold of $100,000 in sales or 200 transactions in the previous calendar year.

Marketplace Verification

How to pass Etsy verification with a Michigan LLC

What Etsy asks for at signup, and which Michigan LLC documents satisfy each requirement.

By Edmond Hui · Last updated: August 4, 2026

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.

A Michigan LLC is generally eligible for Etsy verification — you will need to provide your Articles of Organization, EIN, beneficial-owner ID, and a valid US business address. Nothing about forming in Michigan blocks approval, and nothing about it guarantees approval either: the final call is Etsy's.

Etsy requires sellers using Etsy Payments to complete identity and tax verification before receiving payouts. For a Michigan LLC registered as a business (not a disregarded entity), Etsy collects the entity name as it appears on your Articles of Organization, the legal address, the EIN or other taxpayer number, and verifies this information against the IRS database. Etsy also requires a government photo ID and selfie via its identity-verification partner Persona, plus a bank account linked to receive Etsy Payments disbursements.

In Michigan the entity behind that check is an LLC created by filing Articles of Organization, which costs $50. Michigan does not publish a processing time for LLC filings, so treat state approval as the open-ended step in your timeline rather than the Etsy review. Because Michigan keeps members and managers off routine public filings, Etsy has no public state record to match your owner name against, and relies entirely on the identification you upload.

Michigan has 58,759 solo retail trade businesses with no employees, averaging $59,724 in annual receipts (U.S. Census Bureau, Nonemployer Statistics (NES), 2023).

Not legal advice: Verification requirements change, and so do Michigan's filing fees and forms. Confirm current platform rules with Etsy, and current filing rules with the Michigan filing office, before you file. Etsy's requirements were last reviewed 2026-07-21, and Michigan's figures on this page come from its own published schedule.

What Etsy requires, and how a Michigan LLC meets each

Requirement	How your Michigan LLC satisfies it
LLC entity name verified against IRS	Use the exact LLC name as Michigan recorded it on your Articles of Organization; it must match your bank account holder name.
Employer Identification Number (EIN)	Provide your federal EIN (free from the IRS; non-US founders without an SSN must apply via Form SS-4 by fax or phone rather than the online tool) — independent of Michigan.
Taxpayer information and IRS verification	Complete the tax interview. A Michigan LLC owned by US persons typically submits a W-9 using its EIN; non-US owners of a disregarded-entity Michigan LLC generally use a W-8 form instead.
Government photo ID and selfie (via Persona)	Provide a government ID for each beneficial owner, even though Michigan names none of them publicly. Michigan publishes no member or manager, so the platform relies entirely on the ID you upload — names must match your operating agreement.
Bank account for Etsy Payments disbursements	Link a US business bank account opened with your EIN and your Michigan Articles of Organization.

Michigan-specific things to watch

Michigan keeps both members and managers off routine public filings, but you must still upload beneficial-owner identification directly to Etsy. State-level anonymity does not exempt you from the platform's KYC. (Articles of Organization (Form CSCL/CD-700) require only the company name, purpose, duration, resident agent, and registered office, signed by an organizer who may be a third party, and the annual statement under MCL 450.4207(3) requires only the resident agent's name and registered office address. No member or manager is listed on any routine public filing. One caveat: MCL 450.4103(2) requires the annual statement to name the person signing and the capacity in which they sign, so a member who signs it personally appears on the public record (MCL 450.4103(3) lets an authorized agent sign instead). A professional LLC is no exception (form CSCL/CD-701 names no member or manager either) but its Article V attests that all members and managers are licensed or otherwise legally authorized to render one or more of the services stated, except as Section 904 of P.A. 23 of 1993 provides; that limits who may own a PLLC, not who is disclosed.)

Michigan sales tax & nexus rules for Etsy sellers

Michigan charges a 6% state sales-tax rate, and like every state with a sales tax it has a marketplace-facilitator law — Etsy collects and remits Michigan sales tax on your marketplace orders for you. You still need your own Michigan registration if you also sell off-marketplace (your own site, invoices) and either have physical presence in Michigan — an in-state location, inventory, or employees — or cross the state's remote-seller economic-nexus threshold of $100,000 in sales or 200 transactions in the previous calendar year.

Michigan has a flat 6% state rate with no local add-ons, making it straightforward for compliance. Michigan does not tax services generally but does tax the delivery of digital goods and software. Michigan is an SST member state. Register through Michigan Treasury Online (MTO).

How to verify your Michigan LLC on Etsy

LLC entity name verified against IRS. Use the exact LLC name as Michigan recorded it on your Articles of Organization; it must match your bank account holder name.
Employer Identification Number (EIN). Provide your federal EIN (free from the IRS; non-US founders without an SSN must apply via Form SS-4 by fax or phone rather than the online tool) — independent of Michigan.
Taxpayer information and IRS verification. Complete the tax interview. A Michigan LLC owned by US persons typically submits a W-9 using its EIN; non-US owners of a disregarded-entity Michigan LLC generally use a W-8 form instead.
Government photo ID and selfie (via Persona). Provide a government ID for each beneficial owner, even though Michigan names none of them publicly. Michigan publishes no member or manager, so the platform relies entirely on the ID you upload — names must match your operating agreement.
Bank account for Etsy Payments disbursements. Link a US business bank account opened with your EIN and your Michigan Articles of Organization.

Non-US founders with Michigan LLCs

Non-US sellers can use Etsy Payments in supported countries, but a Michigan LLC's seller account must be linked to a US bank account or an eligible payment method. Non-US beneficial owners of a Michigan LLC must still complete identity verification via Persona with a valid government ID.

Frequently Asked Questions

: If you have an EIN and file taxes as a business entity (not a disregarded entity), register as a business. Etsy then verifies the entity name and EIN against IRS records, so the name has to match your Michigan Articles of Organization. A single-member Michigan LLC taxed as a disregarded entity can register as an individual and provide an SSN or ITIN.
: Etsy withholds payouts until verification is complete, whichever state the shop's LLC comes from. If you miss the deadline shown in your Shop Manager dashboard, you have 90 days before the shop may be closed.
: Michigan charges $50 to file Articles of Organization, and that is the state's fee to create the LLC. Michigan does not publish a processing time for LLC filings, so treat state approval as the open-ended step in your timeline rather than the Etsy review. Etsy charges nothing for verification itself, so the $50 filing fee and Michigan's ongoing obligations are the real cost of getting verified as a Michigan entity.
: Etsy does not check where you live, only that the Michigan entity is validly registered and that the details you enter match Michigan's record. The catch is not Etsy, it is the state you actually operate from: states require an out-of-state LLC to register as a foreign LLC before it transacts business there, which is a second filing and a second fee on top of Michigan's $50. Forming in Michigan while working somewhere else usually means paying both states, not one.
: Not for your Etsy orders themselves. Michigan charges a 6% state rate and, like every sales-tax state, has a marketplace-facilitator law that makes Etsy collect and remit it for you. You need your own Michigan registration once you also sell off-marketplace and either have physical presence in Michigan or cross its remote-seller threshold of $100,000 in sales or 200 transactions in the previous calendar year.