Michigan-based company out-of-state internet sale taxable by the State?

Sorry, you are being illogical - just because people who bought your stuff on ebay live out of state, doesn't mean anything - its your tax and your return we're talking about here - so even if you sold to China - you pay the tax in your state. Now if you didn't apply for a sellers permit (that alerts the state to the fact you may have collected your states sales tax, and want to contribute your share) there's no way for the state to know that you earned money online. If you want to go that way, you get to offset your "profit" from your stocking costs, and you list your other expenses as if you were in business.