How To Start An LLC In Arizona (2024 Guide)

Though LLC formation is a straightforward process, there are details to handle prior to submitting your paperwork. Below are items you should handle before starting your LLC in Arizona.

Step 1: Reserve an LLC Business Name

Arizona does not require LLCs to reserve a business name in advance, but if you wish to do so, make sure you do not file your Articles of Organization until afterward. Submitting documents in the wrong order will cause your name reservation request to get rejected.

Once you’ve settled on the perfect moniker, you can reserve your business name online and pay $45 by credit card. This is the fastest method but bear in mind that this includes a $35 expedition fee. If you have time to wait, you can complete the name reservation process off-line and pay just $10. Remember to make checks or money orders payable to the Arizona Corporation Commission, and please note that all fees are nonrefundable.

Arizona LLC Naming Requirements

Keep in mind that when choosing a name for your business, you must be sure it complies with Arizona’s corporate and LLC naming policy. An LLC in Arizona must have a unique and distinguishable name from all the business entities registered with the ACC. The name should not be confused with any existing trademarks or violate any current laws as well.

Arizona also requires that an LLC name contain one of the following:

• Limited liability company
• Limited company
• An abbreviation such as L.L.C., L.C., LLC or LC

How To Check if Your Preferred Name Is Available

The next step is to conduct a thorough search to ensure that your desired LLC name is available and not already used by another Arizona business entity. Your application will be rejected if another entity has already registered a business in your desired name. You can search the ACC’s online business entity database.

Make sure to consider doing a trademark search to avoid infringing upon existing trademark holders. The United States Patent and Trademark Office (USPTO) offers an easy-to-search online database called TESS. Here, you can search existing trademark registrations with USPTO. Review any trademarks that closely resemble your proposed name to determine whether any conflict arises. Arizona also offers a state-specific database where trademark registrations may be found.

Make sure to review both databases when picking an LLC name. Look out for trademarks similar to your desired LLC name, both in terms of its sound and what goods or services it covers. Assess whether there’s any risk that confusion might occur between it and existing trademarks that already exist.

Purchase a Web Domain

You need to ensure that the domain name you desire is available. It’s common for businesses to seek domain names that align with their company or brand names. Before picking your LLC name, search domain registration platforms or registrars to check if your desired name is available. If someone has already registered it, consider an alternative domain name or negotiate with the current domain owner to acquire it.

While it isn’t a requirement, making a website is a good idea as potential customers often do internet research on brands. If you do not already have one, it is a good idea to take the time to buy a web domain. Websites are great for building customer trust and industry authority, especially if you share content such as customer reviews.

Consider a DBA

DBA stands for “Doing Business As” and is commonly known as a trade or fictitious name. A DBA allows a company to conduct operations and advertise under this alternative identity while adhering to all requirements under its official legal name.

Registering a DBA in Arizona is a relatively simple process. Once your LLC is formed, you can only file the trade name application online. Start by doing a trade name search. From there, complete the online application and pay the $10 filing fee. Processing times for trade names are two to three weeks.

Step 2: Hire a Statutory Agent

A statutory agent, also referred to as a registered agent, is appointed by a business to receive legal documents and official correspondence on its behalf. Their primary duties focus on legal matters while their secondary responsibility ensures timely communications for essential business operations and management matters.

What Is a Statutory Agent Responsible For?

A statutory agent serves an integral function of a business. They ensure their clients receive essential communications in a timely and reliable manner. Here are some of the functions of a statutory agent.

• Maintain a registered address where legal documents and official correspondence can be delivered.
• Receive lawsuits, summonses, complaints, subpoenas and official notices on the business’s behalf.
• Swiftly forward all notices to the business while also assisting with keeping the notices organized effectively.
• Keep the business aware of ongoing compliance obligations and filing or reporting requirements to relevant regulatory bodies to ensure good standing with said regulatory bodies.

A statutory agent is an intermediary between the business entity and regulatory and government agencies. They receive and transmit official communications, file necessary forms on behalf of the business and help ensure compliance with applicable laws and regulations. They treat all documents with the highest levels of privacy. They protect any received data that might otherwise be disseminated to unintended parties.

Who Can Be a Statutory Agent in Arizona?

LLCs in Arizona must follow strict rules on who can be their statutory agent. A statutory agent is a person or business with a physical address in Arizona. A statutory agent may be:

• An individual who is at least 18 years of age
• A domestic corporation or LLC
• A foreign corporation or LLC that is authorized to do business in Arizona

In addition to having a physical address in Arizona, the statutory agent must be open during regular business hours to receive all correspondence. The LLC itself can’t be its own statutory agent, but a manager or member can. However, we suggest you consider hiring a third party as the statutory agent. Hiring an agent can cost as low as $49 per year, but you should expect to pay between $100 and $300 annually. Be sure to read reviews and ask questions before hiring anyone.

To form an LLC in Arizona, you must file Articles of Organization with the ACC. Articles of Organization are legal documents. They are an essential part of the formation process and contain important information about the structure and operation of the company. Once approved by the ACC, they establish the existence of the LLC as a separate legal entity.

What To Include in the Articles of Organization

Articles of Organization typically require specific information about the LLC in Arizona. This includes:

• LLC’s Legal Name. This must comply with the state’s naming requirements.
• Physical Address. This does not need to be an Arizona address and can be the same as the statutory agent.
• Statutory Agent. An individual or business responsible for accepting correspondence on your behalf.
• Management Structure. Specify whether the LLC will be member-managed (managed by its owners) or manager-managed (managed by appointed managers).
• Members/Owners Details. The names and addresses of the initial members or owners of the LLC.

Where To Submit the Articles of Organization

The fastest and most convenient way to submit your Articles of Organization is online through the ACC website. If you cannot file the form online, you can do it by mail or fax.

If you mail or fax the document, make sure to include the following:

• Cover Sheet
• Articles of Organization
• Member Structure Attachment or Manager Structure Attachment
• Statutory Agent Acceptance
• Payment

If filing by mail, payment must be in the form of a check. No cash is accepted through the mail. Checks must be payable to “Arizona Corporation Commission.” The completed documents and check can be mailed to:

Arizona Corporation Commission, Examination Section
1300 W. Washington St.
Phoenix, Arizona 85007

If you are faxing the documents, you will need a Money-On-Deposit (MOD) account to pay the filing fee. You can also fax the paperwork to (602) 542-4100 for regular or expedited service. For same-day service, fax documents to (602) 542-0900.

Step 4: Get an Employer Identification Number (EIN)

An EIN, sometimes called a Federal Employer Identification Number (FEIN) or Federal Tax Identification Number (FTIN), is required for most businesses. In the case of single-member LLCs, it is an excellent alternative to using one’s Social Security number, keeping it safe from exposure or potential fraud. They are free and easy to obtain through the IRS website.

Step 5: Create an LLC Operating Agreement (Optional, but Recommended)

Operating agreements typically clarify the financial and functional decisions related to the LLC. Though not required, LLC operating agreements are highly recommended. These documents confirm everything from which members have the most significant say in company decisions to who is responsible for the day-to-day business operation.

A detailed operating agreement lends legitimacy to your LLC, helping to maintain its good standing.

Step 6: File a Notice of Publication

Unless you are operating in Maricopa or Pima counties, you must file a Notice of Publication within 60 days of forming your LLC as noted on page two of the Articles of Organization instructions. Once the Arizona Corporation Commission approves your articles for filing, they will send you a letter with instructions on how to publish the information.

To establish an LLC in Arizona, you must pay the necessary fees. It’s important to note that filing fees are nonrefundable and nontransferable. Make sure all your paperwork is accurate before you submit it. Fees can be paid with cash, check or credit cards.

Cash is accepted in person at the Phoenix office only. Credit cards can be used online or in person. Checks must be made out to “Arizona Corporation Commission.” Do not abbreviate the payable name. The ACC will not accept any temporary or foreign bank account checks. Below are the current filing fees. For a complete list, check out the ACC website.

• Articles of Organization – $50
• Expedited Articles of Organization – $85

For regular filing, it will take about 14 to 16 business days. Expedited takes three to five business days. If you need your LLC set up sooner, you can file them one of the following ways:

• Next Day – additional $100 fee and will be returned by the end of the following business day
• Same Day – additional $200 fee and will be returned by the end of the business day
• Two Hours – additional $400 fee and will be returned within two hours of receipt

For more information about the same-day/next-day services and the current processing time, check out the ACC website here.

Correct Any Filing Errors

It is always possible for mistakes to get made. If you spot an error after your LLC paperwork gets processed, you should move to fix it as soon as possible with a Statement of Correction. The associated fee is $25.

After forming your LLC in Arizona, additional tasks beyond formation must be addressed. These duties may include permits, accounting practices and insurance requirements. By tending to these issues properly, you will establish a strong base for your LLC to operate legally and ethically.

Obtain Business Licenses and Permits

Depending on the nature of your business, you may need a business license or permit to legally operate your LLC in Arizona. It’s essential to conduct thorough research into federal, state and local requirements. Check out this full guide on Arizona business licenses and permits.

Arizona does not require a general business license to operate. However, depending on the nature of your business or its location, there may be a licensing requirement. For example, suppose you are an LLC in Arizona that operates restaurants and bars. In that case, you may need licenses with the federal government, Arizona and the local county or city where your restaurant and bar is located.

A Transaction Privilege Tax License is another common license needed for LLCs in Arizona. This license, commonly referred to as a sales tax license in other jurisdictions, is required for a business that sells certain products or engages in a particular service. To get this license, you will need an EIN.

Open a Business Bank Account

It’s a good practice to open a separate bank account for your business to keep your personal and business finances separate. This helps with tracking income and expenses and simplifying tax filing. You need your formation documents and EIN to open a business bank account. Most banks require the owner or manager to open the account in person. Check out this guide from Forbes for the best banks to open a business account with.

Get Business Insurance

Consider purchasing adequate insurance to shield your business against the risks and liabilities that it faces. There are several types of business insurance that you may consider depending on your industry and the nature of your business. Here are some common types of business insurance:

• General Liability Insurance protects against bodily injuries, property damages and personal injuries sustained through your business activities.
• Professional Liability Insurance covers negligence-based lawsuits related to errors or omissions within professional services provided to clients.
• Property Insurance coverage safeguards your business assets including property, equipment, inventory and physical assets against events such as fire, theft, vandalism or natural disasters.

Some additional insurances you may want to consider are:

• Workers’ Compensation Insurance
• Commercial Auto Insurance
• Cyber Liability Insurance
• Product Liability Insurance
• Business Interruption Insurance