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Michigan Bookkeeping
Property Management Bookkeeping in Michigan
Owner funds are not your funds, and the books have to prove it.
Remote bookkeeping — monthly close, cleanup, and books ready for your CPA.
Michigan taxes through the Michigan Department of Treasury at a 6% statewide base rate, with local rates stacking on top and economic nexus for remote sellers at $100,000 in sales or 200 transactions. Filing runs monthly, quarterly, or annually by liability. Because Michigan runs an annual bracket, low-volume property management can go twelve months between returns — which is exactly how long a liability account can drift before anyone looks at it.
Employer registration runs through the Michigan Unemployment Insurance Agency, and the entity is registered with the Michigan Department of Licensing and Regulatory Affairs. No local sales tax, and sales and use tax are reported on a combined return with withholding.
At a glance
Sales tax authority
Michigan Department of Treasury — 6% statewide base rate
Economic nexus
$100,000 in sales or 200 transactions
Filing cadence
Monthly, quarterly, or annually by liability
Employer registration
Michigan Unemployment Insurance Agency
Entity registration
Michigan Department of Licensing and Regulatory Affairs
Owner and trust funds in Michigan
Money held for owners in Michigan is not your money, and Michigan sets its own rules — through state law and the Michigan Department of Licensing and Regulatory Affairs-registered licensing regime — on how those funds are held, how often they are reconciled, and what records must exist. We keep the trust ledger reconciled to the bank with owner-level detail behind every balance; whether that satisfies Michigan's specific requirement is a determination for you and your attorney, not us.
Security deposits in Michigan
Security deposits in Michigan are a liability, not income. Michigan caps a residential deposit at 1.5 months' rent, and requires you to return or account for it within 30 days of move-out. That deadline is why the ledger has to be per-tenant rather than one pooled balance — a pooled figure cannot answer "what is owed to this tenant, and by when," which is the only question that matters when a deposit is disputed.
Registering to do business in Michigan
Registering to do business in Michigan runs through the Michigan Department of Licensing and Regulatory Affairs, with tax accounts through the Michigan Department of Treasury and employer accounts through the Michigan Unemployment Insurance Agency. Michigan treats these as wholly independent, so being in good standing with one says nothing about the others — and the sales tax account is the one that accrues a real balance while you are not looking.
Michigan rates and sourcing
The Michigan statewide base rate is 6%. That sits mid-table nationally, with local rates layered on top and sourced to the delivery address rather than to your own location. Sourcing is where this is won or lost, and with economic nexus set at $100,000 in sales or 200 transactions, it becomes your problem the moment that threshold is crossed.
We keep the books. You run the business.
Categorization, reconciliation, month-end close, and clean financial statements — with nothing left for you to chase.
We check where your property management books stand and whether Michigan activity has crossed $100,000 in sales or 200 transactions.
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Register what is needed
Accounts set up with the Michigan Department of Treasury, plus the Michigan Unemployment Insurance Agency if you have employees here.
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Catch up
Back periods cleaned up at a fixed quoted price, including any Michigan liability that was collected but never reconciled.
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Close on cadence
Monthly close worked backward from your Michigan due dates — monthly, quarterly, or annually by liability.
Property Management Bookkeeping in Michigan — Frequently Asked Questions
Do property management need to register for sales tax in Michigan?
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If you cross $100,000 in sales or 200 transactions, Michigan generally expects you to register with the Michigan Department of Treasury and begin collecting. Physical presence also creates an obligation. We track your Michigan activity against the threshold and flag it as you approach — whether to register, and how to handle any prior period, is a decision to make with your CPA or a tax professional.
How often do property management file in Michigan?
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Michigan sets it by liability — monthly, quarterly, or annually by liability — and moves you between brackets as volume changes, so it is worth confirming each year rather than assuming. We close the month against the Michigan Department of Treasury calendar you are actually on.
Which Michigan agencies do property management deal with?
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Three: the Michigan Department of Treasury for sales tax, the Michigan Unemployment Insurance Agency for employer registration and unemployment, and the Michigan Department of Licensing and Regulatory Affairs for the entity itself. Separate account numbers, separate portals, separate deadlines — and a notice from one tells you nothing about your standing with the other two.
Do property management pay Michigan state income tax?
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Michigan does levy a state income tax, so there is a state return in addition to the federal one. We keep the books that those filings are built from and hand them to your CPA or tax preparer reconciled; we do not prepare or file income tax returns ourselves.
How should Michigan security deposits appear in the books?
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As a liability, never as income. Michigan caps deposits at 1.5 months rent and requires return within 30 days of move-out, with deductions itemized. Deposits recorded as revenue overstate income and leave nothing to return from, which is the single most common error we correct on these books.
Do you prepare income tax returns for property management?
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No. We are a bookkeeping firm, not a licensed CPA firm or a registered tax preparer, and we do not prepare or file income tax returns. We prepare and file sales and city tax returns and 1099 information returns, which are bookkeeping functions, and we hand off clean reconciled books to your CPA or tax preparer for anything income-tax related.