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How to Start a Hair Salon in Michigan: Licenses, Costs & Requirements

Michigan licenses a hair salon in two layers, the people and the premises: cosmetologists and establishments under Article 12 in LARA, barbers under a separate board entirely, and renewal dates that follow each license instead of a fixed calendar day. The fees are small: $63 for the stylist and $75 for the salon. The traps are the establishment license that goes void the day the salon is sold, and the booth rent arrangement Michigan pointedly does not license.

Researched from Michigan state sources. Our guides are free. We may earn a commission when you use a partner service, at no additional cost to you.

The regulator: the Board of Cosmetology in LARA

A Michigan hair salon answers to the Board of Cosmetology, part of the Department of Licensing and Regulatory Affairs (LARA), Bureau of Professional Licensing. Cosmetology is regulated under Article 12 of the Occupational Code, Act 299 of 1980, and the board itself is created by section 339.1202 of the Michigan Compiled Laws. The board licenses people and premises in two separate layers: cosmetologists and the other individual practitioners on one side, and cosmetology establishments on the other. Applications and renewals for both layers run through MiPLUS, the Michigan Professional Licensing User System.

Two features of the Michigan system shape everything in this guide. First, barbering is not part of this board at all: barbers answer to a separate Board of Barber Examiners under Article 11, so a Michigan salon and a Michigan barbershop are licensed under different articles of the same code, with different training hours and different fees. Second, Michigan renewal dates are personal rather than fixed. Under rule R 339.1003, cosmetology licenses and establishment licenses renew every 2 years on the biennial anniversary of the issue date, so two stylists hired in different months carry different renewal dates, and the salon has to track each one.

Michigan hair salon requirements at a glance

Practitioner licenses: the cosmetologist license

Every person who provides cosmetology services in your salon must hold their own license. There is no shared salon license that covers your staff. The cosmetologist license is the broad license of the Michigan salon, the credential behind the chair for hair care, paired in the statute with skin care and manicuring services.

Section 339.1207 of the Michigan Compiled Laws sets two routes to the license. The school route is a 1,500 hour course of study in a licensed school of cosmetology. The apprenticeship route is service as an apprentice for not less than 2 years in a licensed cosmetology establishment offering hair care, skin care and manicuring services. Either way, the applicant must be age 17 or older, show good moral character, hold an education equivalent to completion of the ninth grade, and pass an examination prescribed by the department and the board. The fee schedule in the State License Fee Act, section 338.2225, prices the individual licenses the same across Article 12: a $15 application processing fee plus a license fee of $24 per year. On the 2 year cycle that is $63 for the initial license and $48 at renewal. Those rates are in effect for payments through September 30, 2027; the statute sets lower rates for payments after that date.

One boundary on the cosmetologist license deserves attention before you build a service menu around it. A cosmetologist may not perform electrology unless also licensed as an electrologist, under section 339.1203a. Electrology is its own credential in Michigan, with its own training route, so a salon that wants to offer permanent hair removal by electricity needs a dually licensed practitioner rather than a cosmetologist working outside the scope of the license. Verify every applicant's license in MiPLUS before their first shift: an unlicensed person providing services puts your establishment license at risk, not just their own.

The establishment credential: the cosmetology establishment license

Separate from every individual license, the salon itself needs a cosmetology establishment license under section 339.1204. The owners or managers apply, and the application is more than a form and a fee: it includes the address of the premises and a drawing or diagram showing the required equipment and facilities, and it must show full partition and door separation from any adjacent dwelling or school. The premises must then pass a department inspection for sanitation and equipment standards. Plan the inspection into your buildout schedule: the diagram you file and the room the inspector walks through have to describe the same salon.

The fee follows the establishment line of the same State License Fee Act schedule: a $25 application processing fee plus a license fee of $25 per year, which is $75 for the initial 2 year license and $50 at renewal, at the rates in effect for payments through September 30, 2027. Once licensed, the establishment license and the license of each cosmetologist working in the salon must be displayed prominently; an individual license may be posted at the practitioner's workstation. Michigan also offers a limited cosmetology establishment license for premises that offer only specified services, under section 339.1204(3): a limited license fits a nails only or skin care only studio, and a cosmetologist working in a limited establishment may not perform services the establishment is not licensed to provide. A full service hair salon takes the full establishment license.

The rule owners feel most is the void on transfer rule in section 339.1204(4). The license is void on a sale or transfer of the establishment or its ownership, or, except for a mobile salon, on a change of location. Buying a salon does not buy its license, and moving does not move it either: a new license application is required in each case. Price that fresh application, and its inspection, into any purchase or relocation plan.

Forming your LLC and the February 15 annual statement

Most Michigan salon owners form a limited liability company so the business's debts and legal problems stay with the business instead of following them home. An LLC is formed by filing Articles of Organization, Form 700, with the Corporations Division of LARA, and the filing fee is $50. A professional LLC files Form 701, also $50. The recurring duty is the annual statement of resident agent and registered office, due not later than February 15 of each year under section 450.4207, at a fee of $25. An LLC formed after September 30 skips the immediately following February 15.

Michigan's penalty structure for a missed statement is unusual, and worth understanding precisely. There is no late fee for a standard LLC. If an LLC fails to file annual statements for 2 consecutive years, the administrator sends a notice; if the missing statements and fees are not filed within 60 days after that notice, the LLC is not in good standing under section 450.4207a. Not in good standing means no certificate of good standing will issue, the company's name becomes available for use by another entity, and the administrator accepts no filings from it except a certificate of restoration of good standing, which costs $50. The LLC is not dissolved: it remains in existence and may continue to transact business. A salon that cannot produce a certificate of good standing will still feel it with landlords, lenders and payment processors, so the February 15 date belongs on the calendar from year one.

Registering your assumed name

If your salon will trade under a name different from the legal name of the person or entity that owns it, Michigan calls that name an assumed name, and where you file depends on your structure. Sole proprietors and general partnerships file a certificate of assumed name with the county clerk of each county where business is conducted or a location is maintained, under Act 101 of 1907. The filing fee is $6, the certificate runs 5 years, and a renewal certificate filed before expiration costs $4 and extends the name another 5 years; letting it lapse is treated as abandonment of the name.

An LLC files its certificate of assumed name with LARA instead, for $25. The LLC certificate expires December 31 of the fifth full calendar year after the filing year, and renews for $25, filed within 90 days before expiration. A corporation pays $10 on the same term. An assumed name filing is not a license and does not create your entity: it puts the public on notice of the trade name, and your bank will typically want to see it.

Getting your federal Employer Identification Number

Your EIN is your business's federal tax ID, issued by the IRS, and it is free. You need one to hire employees, open most business bank accounts, and file business taxes. Apply directly through the IRS and ignore any website that offers to obtain one for a fee. If the business has an EIN, it doubles as the Treasury account number for state tax registration, so apply early, after the entity exists.

Sales tax: services sit outside the tax, retail products are taxed

Michigan charges a 6 percent state sales tax on retail sales of tangible personal property, and there is no city, local or county sales tax anywhere in the state, so the rate at your register is the same in Detroit, Grand Rapids or Marquette. The tax reaches retail transfers of property. The service charge itself sits outside the tax, while products the client takes home are taxable retail sales: the shampoo, cosmetics and styling products sold at the front desk are rung up with tax, and Treasury guidance treats any property that goes with the customer in connection with a service as a sale at retail. Set your booking and point of sale system to itemize services and products separately from day one, so the tax lands on the products and not on the haircut.

A business that sells tangible personal property in addition to providing a service must hold a sales tax license. Register through Michigan Treasury Online e-registration, or on paper with Form 518. The online application is recognized within 15 minutes and processed within up to 48 hours. The license runs January through December and renews annually.

Booth rent in Michigan: no booth renter license

Michigan takes the opposite approach to booth rental from Ohio, and owners moving between the two states get this wrong in both directions. Article 12 contains no booth renter license, no booth rental permit and no booth rental fee line: a stylist who rents a chair or a room in your salon works under their own cosmetologist license, inside your licensed establishment, without a second state credential for the rental itself. What Michigan does define is the room. A cosmetology suite is a room or suite located inside a licensed cosmetology establishment that is leased or rented from the owner of the establishment for the purpose of offering or providing cosmetology services, under section 339.1201(e), and the definition of a cosmetology establishment includes a mobile salon and a cosmetology suite.

The absence of a renter license settles the licensing question, not the classification one. A renter who sets their own prices and hours and collects their own money is running a business inside your business; a stylist whose schedule and prices you set looks like an employee to the tax and unemployment agencies. Put rental agreements in writing, keep payment handling separate, and read the Michigan salon suite guide if the model you are building is a building of leased rooms rather than chairs inside one salon floor.

Hiring staff: withholding, unemployment, and wages

The first hire triggers the employer stack, and Michigan lets you start most of it with one form. Form 518 registers a business for sales tax, use tax, income tax withholding, corporate income tax and unemployment insurance tax, and the Michigan Treasury Online e-registration replaces it online. The Unemployment Insurance Agency issues the unemployment account number, in as little as three days online. An employer required to withhold federal tax must also withhold Michigan income tax, at 4.25 percent.

Unemployment tax is paid entirely by the employer. A new non-construction employer pays 2.7 percent plus one third of its chargeable benefits component in year 1, two thirds in year 2, and the full experience rated formula from year 3. The tax applies to the first $9,000 of each employee's wages for 2026 for employers in good standing, and the first $9,500 for employers who do not meet those criteria. Quarterly Wage and Tax reports are due even with no employees and no wages, and late submission can bring penalties and interest. Accounts are managed in the new MiUI system: MiWAM was permanently retired on November 2, 2026.

The wage floor is set by the Improved Workforce Opportunity Wage Act. From January 1, 2026, the minimum wage is $13.73 an hour, and the tipped wage is $5.49 an hour, provided the employee receives at least $8.24 in tips. On January 1, 2027 the full rate rises to $15.00 and the tipped rate to $6.30, so build the increase into first year pricing. Workers' compensation sits under the Worker's Disability Compensation Act, which reaches private employers who regularly employ 3 or more employees at one time, and employers with fewer than 3 if at least one employee has worked 35 or more hours a week for 13 of the preceding 52 weeks. Coverage is bought from an insurer authorized to sell workers' compensation insurance in Michigan.

The local layer: zoning, and services that live elsewhere

State licenses do not guarantee your location is legal. Your city or township controls zoning, and a salon has to be a permitted use at the address you choose, with local sign off on the buildout, occupancy and signage. Check zoning before the lease, not after: the establishment application itself, with its diagram and its partition and door separation from any adjacent dwelling or school, assumes a premises you are entitled to occupy, and a cheap space in the wrong zoning category is not cheap once you have paid for chairs and plumbing you cannot legally use.

Two popular add-on services do not ride on the establishment license. Microblading is body art: in Michigan it may be performed only at a body art facility licensed by the Department of Health and Human Services, under Part 131 of the Public Health Code, even inside a licensed salon, as the Michigan microblading guide works through. Massage therapy is licensed separately under Part 179A of the Public Health Code, with its own board and its own individual license, as the Michigan massage guide explains. Plan the menu against the licenses each service actually requires, not against the room you happen to have free.

Insurance and the costs that keep coming back

Beyond the workers' compensation duty covered in the hiring section, salon owners typically shop for general liability coverage, professional liability coverage for the services performed, and property coverage for the buildout, chairs, dryers and retail inventory. Premiums vary widely with your city, service menu and team size, so this guide does not quote benchmark prices that would be wrong for your shop. Get quotes before your lease starts, because many landlords require proof of liability coverage as a lease condition.

Your recurring state costs are small and predictable: license renewals on the 2 year MiPLUS cycle, the $25 LLC annual statement each February, sales tax on retail products, and quarterly employer reports. The expensive mistakes in a Michigan salon launch are almost never the state fees. They are the lease signed before zoning was checked, the stylist hired before their license was verified, and the purchased salon whose establishment license turned out to be void on the sale.

Your Michigan renewal calendar

• Every 2 years, on the biennial anniversary of the issue date: cosmetologist licenses renew through MiPLUS at $48 each, and the cosmetology establishment license renews at $50. The State License Fee Act rates in this guide are in effect for payments through September 30, 2027
• February 15, every year: LLC annual statement due to LARA, $25. An LLC formed after September 30 skips the immediately following February 15
• January through December: the sales tax license runs with the calendar year and renews annually
• Every quarter: Wage and Tax reports to the Unemployment Insurance Agency in MiUI, due even with no employees and no wages
• January 1, 2027: minimum wage rises to $15.00, and the tipped wage to $6.30
• On any sale, ownership transfer or move: the establishment license is void, and a new license must be applied for before the salon operates under the new owner or at the new address
• Every 5 years: an assumed name certificate renews, $4 at the county clerk for a sole proprietor or $25 with LARA for an LLC, filed before expiration

Official Michigan sources for this guide

• Michigan Compiled Laws section 339.1207: cosmetologist qualifications, the 1,500 hour school course and the apprenticeship of not less than 2 years
• Michigan Compiled Laws section 339.1204: the cosmetology establishment license, the drawing and partition requirements, inspection, the limited establishment license, and the void on transfer rule
• Michigan Compiled Laws section 338.2225: the State License Fee Act rates for cosmetology licenses in effect for payments through September 30, 2027
• Administrative rule R 339.1003: the biennial renewal cycle keyed to the anniversary of the issue date for cosmetology and barber licenses
• Michigan Compiled Laws section 339.1201: the definitions of a cosmetology suite and a cosmetology establishment
• Michigan Compiled Laws section 450.4207a: good standing, the 2 consecutive year notice rule, and restoration for an LLC that misses annual statements
• Department of Treasury, who needs a sales tax license: the 6 percent state rate, the absence of local sales tax, and which service businesses must hold a license
• Department of Labor and Economic Opportunity, minimum wage release: the January 1, 2026 minimum wage of $13.73, the tipped wage, and the January 1, 2027 increase

This guide is general information researched from official Michigan sources, not legal or tax advice. Requirements, fees and forms change; verify the current rules with the agencies linked above before you file, sign or spend.

Frequently asked questions

How many hours of training does a Michigan cosmetologist need?

A cosmetologist completes a 1,500 hour course of study in a licensed school of cosmetology, or serves as an apprentice for not less than 2 years in a licensed cosmetology establishment offering hair care, skin care and manicuring services. The applicant must be age 17 or older, hold an education equivalent to completion of the ninth grade, and pass the board examination. The license costs $63 initially and $48 to renew every 2 years.

How much does a cosmetology establishment license cost in Michigan?

The cosmetology establishment license costs $75 for the initial 2 year license, made up of a $25 application processing fee plus a license fee of $25 per year, and $50 to renew. The application includes a drawing or diagram of the premises, requires full partition and door separation from any dwelling or school, and the premises must pass a department inspection. These State License Fee Act rates are in effect for payments through September 30, 2027.

Does Michigan have a booth renter license for stylists?

No. Michigan has no booth renter license, permit or fee in Article 12. A stylist who rents a chair or a room in a licensed salon works under their own cosmetologist license inside the licensed establishment. A cosmetology suite is defined as a room inside a licensed cosmetology establishment leased from its owner. The rental is a business arrangement between the stylist and the salon, not a separate state credential.

What happens to the salon license when a Michigan salon is sold or moves?

The cosmetology establishment license is void on a sale or transfer of the establishment, on a sale or transfer of its ownership, or on a change of location, with mobile salons excepted from the location rule. The new owner or the salon at its new address must submit a new license application and obtain a new license. Buying an operating salon does not transfer its establishment license to you.

Are hair services subject to sales tax in Michigan?

The service charge itself sits outside the Michigan sales tax. Products the client takes home are taxable retail sales at the 6 percent state rate, and Michigan has no city, local or county sales tax. A salon that sells products needs a sales tax license, registered through Michigan Treasury Online or on paper Form 518, and the license runs January through December and renews annually.

When do Michigan cosmetology licenses renew?

Cosmetologist licenses and the cosmetology establishment license renew every 2 years on the biennial anniversary of the issue date, through MiPLUS. Renewal is $48 for an individual cosmetologist license and $50 for the establishment license. Because the date follows the license rather than a fixed calendar day, each license in the salon can carry a different renewal date.