Grand Rapids
Grand Rapids taxes income at 1.5% for residents and 0.75% for nonresidents, rates in effect since July 1, 2010. Employers with a location in the city, or doing business there without one, must withhold, paying monthly if monthly withholding exceeds $100 and quarterly otherwise. Michigan doesn't tax residential or commercial cleaning, though its Use Tax Act reaches textile service such as linen, mop, or mat service under agreements of at least 5 days.
The Grand Rapids rule that reaches a cleaning company's books is a city income tax, and the rate turns on where each employee lives. This page covers the two rates and the payment schedule, Michigan's sales tax position on cleaning, the state wage increase in January, and what it means for your books. Statewide payroll registration is on my Michigan page.
The Grand Rapids Income Tax Department's guide for withholders lists 1.5% for residents and 0.75% for nonresidents under rates effective July 1, 2010, and the city's 2025 resident return shows the same two rates. Employers with a location in the city must withhold, and so must those doing business there without a location. Payments are monthly if total monthly withholding exceeds $100 and quarterly if it's below that, due on the last day of the month after the reporting period. The guide shows no page date.
Michigan's sales tax doesn't reach residential or commercial cleaning. Its Use Tax Act does tax laundering or cleaning textiles under a sale, rental, or service agreement with a term of at least 5 days, such as linen, mop, or mat service, except textiles used by a restaurant or retail sales business (MCL 205.93a(1)(d)). Supplies a cleaning business buys for its own use weren't researched for this page. More is on my Michigan sales tax page.
Source: Michigan Legislature, Use Tax Act, Act 94 of 1937, MCL 205.93a(1)(d)
Source: Michigan Legislature, General Sales Tax Act, Act 167 of 1933, MCL 205.52(1)
This page doesn't cover a Grand Rapids wage rule. Michigan's minimum wage is $13.73 an hour as of January 1, 2026, and the Department of Labor and Economic Opportunity lists $15.00 effective January 1, 2027.
Source: Michigan Department of Labor and Economic Opportunity, Wage and Hour Division, Minimum Wage
Source: U.S. Department of Labor, Wage and Hour Division, State Minimum Wage Laws (2026-07-01)
Each employee's residency decides which rate comes out of their pay, so it belongs on the employee record in payroll, and city tax withheld goes to a liability account apart from Michigan withholding. Since the monthly total decides whether you pay monthly or quarterly, that city withholding line has to reconcile back to every single pay run before a payment goes out. Cleaning revenue carries no Michigan sales tax; textile service under a 5-day agreement, which the Use Tax Act does reach, goes on its own income line. Labor is recorded at the wage actually paid, so the increase to $15.00 shows in job costs for minimum-wage hours worked from January 1, 2027, as my payroll page explains.
I'm a bookkeeper, not a CPA or an Enrolled Agent. I keep the city withholding recorded and separate; whether an employee counts as a resident, whether you pay monthly or quarterly, and how the city return gets filed are questions for your CPA.
Rules checked against the sources above as of October 20, 2026. Rates and rules change; confirm current figures with the agency or your CPA.
About Figure Eight Financial
Figure Eight Financial is Dave Gordon’s bookkeeping practice for residential and commercial cleaning companies. I work with owners in Grand Rapids and across the country, and I’m a Certified QuickBooks Online ProAdvisor.
Before bookkeeping I studied computer science at Penn State and spent a career at IBM as an engineer, so I build the books as a system: data comes in once, lands in the right place, and ties back to a statement. I’m a bookkeeper, not a CPA or Enrolled Agent. I keep the books your CPA works from, and the tax decisions stay with your CPA.
Credentials and memberships reported by Figure Eight Financial.
More about DaveHow I Help
Grand Rapids sets the city tax by where each employee lives, so residency sits on the employee record and the withholding goes to its own liability account. Cleaning revenue carries no Michigan sales tax, and labor is recorded at the wage actually paid. Book a short call below and tell me how your Grand Rapids payroll is set up.
The core service. Transactions recorded and categorized, every account reconciled so the books and the bank agree, and monthly reports that arrive explained, split by residential and commercial and sliceable per contract.
The full picture of how this works for a cleaning companyFor the months where nothing got entered at all. I fill in the missing periods from the ground up, pulling bank feeds, statements, and receipts until every month has a complete set of records.
How catch-up bookkeeping worksFor books that exist but can’t be trusted. I audit what’s there, fix the unreconciled accounts, duplicate transactions, and wrong categories, and tie every balance back to a statement.
How cleanup bookkeeping worksYour crews paid on time, every pay period, with each payroll run recorded in the books so labor shows up against the jobs it belongs to.
How payroll worksRecurring invoices that match your contracts, an aging report you can trust, and follow-up on slow payers handled by a process instead of your evenings. Built for net-60 commercial accounts.
How invoicing and receivables workA file built right for a cleaning company from day one, or rebuilt after the DIY version drifts, and then I teach you to run it. I’m a Certified QuickBooks Online ProAdvisor, and this is honestly my favorite part of the job.
How a proper setup worksWe start with a short call about your business and where the books stand. The first conversation doesn’t cost anything.
I take a look at what you’ve got, your QuickBooks file, your spreadsheet, whatever exists.
You get a written proposal with the price, so the decision is yours with the number in hand.
Let's Connect
Cleaning in Grand Rapids with crews on both rates? Tell me how residency is tracked now. The first conversation doesn't cost anything.
