Choose a name for your record label. Start by visiting websites such as Allrecordlabels.com to gauge the types and styles of names other record labels use, and also to ensure that you do not select a name that is already in use or likely to be in use. Avoid using names of familiar brands such as "McDonald's Records" or "IBM Records," as this could potentially lead to lawsuits. File for a fictitious name license, or "Do Business As" (DBA) license, to ensure that your record label name is not already in use in the state of Michigan. Contact your county clerk's office or the Registrar of Deeds to make sure you visit the correct office to file for your license. Also, ask about filing fees, as they vary county by county in Michigan. Visit the office, complete the form and pay the filing fee. Be sure to obtain your license and a receipt for your records.
Decide what type of business you want to set up. For example, choose a sole proprietorship or a limited liability corporation. Set up a sole proprietorship if you are an artist looking to release your own music or, perhaps, functioning solely to release music by other artists. Contact the Internal Revenue Service to receive a federal employer identification number. Next, set up a separate sole proprietor business account at your local bank. However, if you and others are forming a record label, set up a limited liability corporation. Log onto http://www.michigan.gov/dleg/0,1607,7-154-35299_36737---,00.html and download the limited liability partnership form. Complete the form and mail it along with the $100 registration fee (as of 2010) to Michigan's Department of Energy, Labor, and Economic Growth. Finally, meet with your partners to establish where and how a bank account will be set up and who will manage it.
Walk into your county's business license office and ask to obtain a business license. Be prepared to speak with a zoning officer if you are listing your home address as your business address. The zoning officer will want to ensure that you are not disturbing the neighbors with music production or even parking spaces needed for employees. Also, you may need to pay a small filing fee for the license.
Contact Michigan's Department of Revenue office (Michigan.gov/treasury or by phone at 517-373-3200) and ask to receive the form to receive a retail license or permit, Form 518. There is no fee to apply. Look through the accompanying sales tax information because you will have to file sales tax forms each month for CDs sold. Sales tax does not apply to mp3 sales or tour income. You also want to ascertain when you will be expected to turn in tax money for the sale of merchandise.