Most small and medium-sized businesses in Michigan are organized as either limited liability companies (LLCs) or corporations. Once organized, these businesses must be maintained, and one important way of doing that is to file annual reports or statements.
For corporations, annual reports are due on May 15. For LLCs, annual statements are due on February 15. Unfortunately, many business people assume that the initial filing of articles of incorporation or organization when they form their business is all they have to do, and as a result allow their companies to be automatically dissolved for failure to file annual reports or statements.
There are significant consequences of falling years behind on these reports. The State of Michigan can automatically dissolve a company, for instance, and if that happens, the company loses liability protection. In addition, another person may obtain the corporate or LLC name. Finally, banks and other lenders generally require a certificate of good standing before completing a loan, which requires that all reports be filed.
It is also extremely important to make sure that the reports filed are accurate. You must correctly list the officers and directors of your corporation, for instance. If the officers or directors listed on previous reports have changed, you must hold a corporate meeting, or validly take action in lieu of a meeting, to appoint or elect valid officers and directors. We can, of course, help you with that process.
Past reports can be caught up, and a corporation or LLC can be reinstated. The cost to catch up these reports can be three times higher than when you file them timely. If you are curious as to the status of your company, you can check the state’s website at www.dleg.state.mi.us/bcs_corp/sr_corp.asp or contact our to learn about how a professional business attorney can help.