Does Michigan recognize the federal S-corporation election?

Yes. Michigan follows the federal S election, and no separate state election form is required — filing federal Form 2553 with the IRS is enough.

S-corp election · MI

Michigan S-Corporation Election

By Edmond Hui · Facts verified July 29, 2026 against primary state sources

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.

Michigan follows the federal S election. Filing IRS Form 2553 is enough — there is no separate Michigan election form. Michigan is one of 43 states that follow the federal election with no state form of their own.

State treatmentFollows the federal election

Separate state formNot required

State corporate income taxYes

Does Michigan recognize the federal S election?

State treatment of the S election

Follows the federal election	Yes
Separate state election form	None required

No separate state election to file: the federal election on IRS Form 2553 carries over. That covers the election only, not any return the corporation owes. Of the 50 states, 43 follow the federal election with no state form of their own, and 1 more — New York — recognizes S status but requires an election of its own as well.

What an S corporation still owes Michigan

S corporations are outside the 6% CIT, which reaches only C corporations and taxpayers taxed as corporations federally; Michigan has no S-corporation income tax return and shareholders report their share on Form MI-1040. An S corporation may instead ELECT the Michigan flow-through entity tax, levied at the same rate as the individual income tax (4.25%), and then files Form 5772, Michigan Flow-Through Entity Tax Annual Return, electronically through Michigan Treasury Online. The election binds the entity for three tax years and must be made by the last day of the 9th month after year end (September 30 for calendar-year filers).

Franchise or gross-receipts tax

Michigan imposes NO corporate franchise, privilege, or capital-stock tax — the CIT replaced the Michigan Business Tax for standard taxpayers. LARA does charge a one-time organization fee at formation based on authorized shares, on top of the $10 non-refundable filing fee: $50 for 1–60,000 shares, $100 for 60,001–1,000,000, $300 for 1,000,001–5,000,000, $500 for 5,000,001–10,000,000, and $500 for the first 10,000,000 plus $1,000 for each additional 10,000,000. The same share schedule applies again when authorized shares are increased by amendment.

Michigan corporation vs Michigan LLC

State filing charges only. Corporate income tax and franchise tax are excluded because both depend on income or net worth, so no flat figure exists for either entity.

	Corporation	LLC
Formation filing fee	$60	$50
Report cadence	Every year	Every year
Report fee	$25	$25

An LLC is $10 cheaper to file here. That is a one-off charge, so it should not decide the entity type on its own.

Full Michigan LLC cost breakdown · LLC vs C-corp explained · LLC vs S-corp explained

How Michigan compares

State treatment of the federal S election	States
Follows the federal election, no state form needed	43
No corporate income tax, so no state election exists	4
Has a corporate income tax and does not follow the election — the corporation is taxed like a C corporation	2
Follow the election but still impose some entity-level tax on the S corporation — California, Illinois, New York, Massachusetts and Delaware among them	—
Require a separate state election form as well	1

Compare all 50 states · LLC vs S-corp · S-corp salary and savings calculator

Frequently Asked Questions

: Yes. Michigan follows the federal S election, and no separate state election form is required — filing federal Form 2553 with the IRS is enough.
: S corporations are outside the 6% CIT, which reaches only C corporations and taxpayers taxed as corporations federally; Michigan has no S-corporation income tax return and shareholders report their share on Form MI-1040. An S corporation may instead ELECT the Michigan flow-through entity tax, levied at the same rate as the individual income tax (4.25%), and then files Form 5772, Michigan Flow-Through Entity Tax Annual Return, electronically through Michigan Treasury Online. The election binds the entity for three tax years and must be made by the last day of the 9th month after year end (September 30 for calendar-year filers).

Where these numbers come from

This page covers how Michigan treats the federal S-corporation election and what an S corporation still owes the state. Every figure was checked against Michigan's own published sources on July 29, 2026— the state business filing agency's fee schedule, the governing statute, and where a state tax applies, the state Department of Revenue. Commercial formation-service pages were used as leads only and are never cited. Anything the review could not confirm from an official source is left blank on this page rather than filled with an estimate.

Corporate income tax and franchise tax are quoted as the state publishes them, as rate schedules and thresholds, and are excluded from every dollar total here. They depend on income or net worth, so there is no flat figure that would be true for every corporation.

Primary sources: