Michigan Marketplace Facilitator & Sales Tax Rules 2025: What Resellers Need to Know

Michigan Marketplace Facilitator & Sales Tax Rules 2025: What Resellers Need to Know

If you sell in or into Michigan using Amazon, Etsy, eBay, or your own website, understanding Michigan’s marketplace facilitator laws is essential for staying compliant. In 2025, the rules are largely stable, but there are important thresholds, obligations, and nuances you should know. This guide walks you through them—step by step.

Table of Contents

  1. What is a “Marketplace Facilitator” in Michigan

  2. Economic Nexus & Thresholds

  3. Tax Rate, Local Taxes & Product Types

  4. Who Collects & Reporting Responsibilities

  5. Key Licensing & Registration Requirements

  6. Case Study: How a Reseller Complies in Michigan

  7. Common Pitfalls to Avoid

  8. What’s New / Proposed Changes (2025)

  9. Checklist for Resellers

1. What is a “Marketplace Facilitator” in Michigan

  • Under Michigan law, a marketplace facilitator is any platform or marketplace that lists or advertises products on behalf of third-party sellers and also processes payments (directly or indirectly) or otherwise facilitates the sale.

  • When a marketplace facilitator has nexus in Michigan, it is considered the retailer for the purpose of collecting, remitting, and reporting sales tax on facilitated sales. Michigan.gov

  • A marketplace seller is someone making sales through such a facilitator. If the facilitator has nexus in Michigan, the seller generally doesn’t need to collect sales tax on their marketplace orders—assuming the facilitator is collecting the tax appropriately. Michigan.gov+1

2. Economic Nexus & Thresholds

  • Michigan has economic nexus rules that apply to both remote sellers and marketplace facilitators. If you exceed certain thresholds in the prior calendar year, you must register and collect sales tax. Michigan.gov+2TaxCloud+2

  • The thresholds are:

    Trigger Dollar Amount / Transactions
    Gross retail sales into Michigan $100,000
    Number of transactions into Michigan 200 separate transactions

    If you exceed either the $100,000 in retail sales or the 200 transactions in the previous calendar year, you have economic nexus. TaxCloud+1

  • Important: Marketplace-facilitated sales count toward your nexus threshold. If you sell via a facilitator or your marketplace sales are processed by that facilitator, those sales are part of the threshold calculation. TaxCloud+1

3. Tax Rate, Local Taxes & Product Types

  • Michigan has a flat statewide sales tax rate of 6%. There are no local (municipal or county) sales tax add-onsin Michigan for general sales tax. This simplifies compliance a lot compared to many other states. TaxCloud+1

  • Product types (commonly sold by resellers) such as tangible personal property shipped into Michigan are taxable once you have nexus, unless specifically exempt (e.g. certain groceries, prescription medicine). Michigan.gov+1

  • Digital goods and services have nuanced treatment; some digital products may be taxed, others exempt. Always check Michigan Department of Treasury guidance for your specific category. (While this is less of a marketplace facilitator-specific rule, it can affect what products you list and whether they’re taxable.) Sales Tax Helper+1

4. Who Collects & Reporting Responsibilities

  • If a marketplace facilitator has nexus in Michigan, it is responsible for collecting and remitting sales tax on all taxable sales facilitated through its platform (even if the marketplace seller would not have had nexus individually). Michigan.gov+1

  • A marketplace seller, in turn:

    • Does not need to collect sales tax for marketplace orders if the facilitator is collecting properly. Michigan.gov

    • Must provide accurate information to the facilitator so that the facilitator can correctly collect / remit tax. Mistakes in address data, product classification, or missing exemption info can lead to complications. Michigan.gov+1

    • If the seller also makes sales directly (outside the marketplace), and has nexus via the thresholds above, then the seller must separately collect & remit on those direct sales. Michigan.gov+1

5. Licensing & Registration Requirements

  • Once you meet Michigan’s nexus thresholds (via direct or facilitated sales), you must register with the Michigan Department of Treasury to obtain a Sales Tax License / permit. Michigan.gov+1

  • Michigan offers registration via its Treasury website (Michigan Treasury Online) and is part of the Streamlined Sales Tax (SST) system, which helps with multi-state registration and compliance. TaxCloud

  • Keep good records of:

    • Sales by channel (marketplace vs direct)

    • Transactions that helped trigger nexus (number, amount)

    • Documentation from marketplace facilitator about their collection obligations and whether they have nexus with Michigan

    • Exemption certificates or other documentation for non-taxable sales if applicable

6. Case Study: How a Reseller Complies in Michigan

Profile:

  • “Great Lakes Gadgets” sells phone accessories via Amazon (marketplace facilitated) and their own Shopify site.

  • In 2024, their total sales into Michigan are:

    • $75,000 via Amazon (marketplace)

    • $40,000 via Shopify (direct)
      Total = $115,000 across all channels, with ~180 transactions.

What they must do in 2025:

  1. Because their combined Michigan sales exceed $100,000, they have nexus. They must register for Michigan sales tax.

  2. Amazon (as marketplace facilitator) with nexus must collect & remit tax on the Amazon orders delivered to Michigan. Great Lakes Gadgets should confirm Amazon is doing so and keep proof.

  3. For Shopify direct orders into Michigan, Great Lakes Gadgets must also collect and remit sales tax on those direct sales.

  4. Use the flat 6% rate for all sales into Michigan. No need to calculate local add-ons.

  5. Maintain records, separate out marketplace vs direct channels, keep transaction and sales history for possible audit.

7. Common Pitfalls to Avoid

  • Assuming local tax rates apply: Because Michigan does not have local sales tax add-ons (for standard sales tax), many sellers over-charge or mis-configure taxes.

  • Ignoring marketplace sales when calculating nexus: Marketplace-facilitated sales count toward your economic nexus thresholds even if you don’t collect on them (if marketplace is collecting).

  • Using incorrect addresses or customer-provided data: If address or product info is wrong, marketplace facilitator could reject or misreport tax due.

  • Delaying registration after crossing threshold: Once you exceed the nexus threshold, you need to register without delay; there's no grace period built into the statute.

  • Overlooking exemption documentation: If buyers are resellers or exempt, you’ll need proper exemption certificates or documentation—these must be supplied to the marketplace facilitator or seller as applicable.

8. What’s New / Proposed Changes (2025)

  • There is Senate Bill 229 introduced in the Michigan Legislature in 2025. One provision states: “A marketplace seller is not liable for the tax imposed by this act on sales made through a marketplace facilitator required to remit tax under subsection (1).” This reinforces that sellers whose sales are fully facilitated by compliant marketplace facilitators will not carry the tax collection liability for those facilitated orders. Michigan Legislature

  • As of mid-2025, no major changes to thresholds or tax rates have been adopted, so existing rules (nexus, rate, facilitator obligations) remain in force. Keep an eye on Treasury bulletins for any further amendments.

9. Checklist for Resellers Selling Into Michigan

Use this to ensure you’re compliant:

  • Calculate your Michigan gross receipts and number of transactions across all channels (marketplace + direct).

  • If/when you exceed $100,000 or 200 transactions, register for Michigan sales tax via Michigan Treasury.

  • Confirm which marketplace facilitators you use have nexus in Michigan and are collecting/remitting tax.

  • For direct sales (outside marketplaces), ensure checkout systems are configured to collect Michigan’s flat 6% rate.

  • Keep accurate records of all sales channels, transaction counts, and marketplace-facilitated sales documentation.

  • Gather and maintain exemption or resale certificates where needed.

  • Monitor legislative changes—especially Senate Bill 229 and Treasury guidance.

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