Starting a Limited Liability Company (LLC) in Arizona is an exciting step towards establishing your business. Whether you’re a first-time entrepreneur or an experienced business owner looking to expand, forming an LLC can provide numerous benefits, such as personal asset protection and flexible tax treatment.
In this step-by-step guide, we’ll walk you through the entire process of forming an LLC in Arizona in 2025. By the end of this guide, you’ll have all the tools you need to successfully create your LLC and set your business up for success.
Costs Summary
| Fee Type | Cost (USD) |
|---|---|
| Articles of Organization | $50 |
| Registered Agent (Optional) | $50 – $100/year |
| Operating Agreement (Optional) | $0 – $100+ |
| Publication Requirement | $30 – $300+ |
| Annual Report Fee | $0 |
Here are the Steps to Forming an LLC in Arizona
Forming an LLC in Arizona involves a few important steps. Let’s break them down one by one.
1. Search Your LLC Name
Before you can file your LLC formation paperwork, you’ll need to choose a name for your business. Arizona, like most states, has specific rules about the names of LLCs.
Here’s what you need to know:
- Incorporate the Required Terminology: Your LLC name must include the words “Limited Liability Company” or the abbreviations “LLC” or “L.L.C.”
- Distinguishable: Your LLC name must be distinguishable from existing business names already registered with the Arizona Corporation Commission (ACC). This prevents confusion and ensures that there are no conflicts with other businesses.
- No Misleading Names: Your LLC name cannot mislead or confuse the public. For example, you can’t name your LLC something that suggests your business is a government entity or affiliated with one.
Once you have a few potential names in mind, you can use the Arizona Corporation Commission’s business entity search tool to check if your desired name is available.
2. Choose an Arizona Registered Agent
An essential part of forming an LLC in Arizona is selecting a Registered Agent. A Registered Agent is an individual or business entity that agrees to accept legal documents on behalf of your LLC. This includes service of process, legal notices, and official correspondence from the state.
Who can be an LLC Statutory Agent?
- Individuals: If you are the only member of the LLC, you can act as your own statutory agent, provided you have a physical address in Arizona. P.O. Boxes are not accepted.
- Companies: Many business owners hire third-party Registered Agents to ensure that they never miss an important document. These companies specialize in this role and ensure that you remain compliant with state regulations.
Some business owners prefer to use a professional Registered Agent service, such as Northwest Registered Agent, because they handle more than just receiving documents. They also provide a registered office address and ensure that you meet all of the state’s filing requirements.
3. File Arizona LLC Articles of Organization
The Articles of Organization is the official document that creates your LLC in Arizona. This document must be filed with the Arizona Corporation Commission (ACC) to legally form your LLC. You can file your Articles of Organization online, by mail, or in person.
Here’s the information you’ll need to include in the Articles of Organization:
- LLC Name: As we discussed, your LLC name must comply with the state’s naming requirements.
- Statutory Agent’s Information: Include the name and address of your Registered Agent.
- Business Address: Provide the physical address of your LLC’s principal place of business.
- Management Structure: Indicate whether your LLC will be managed by its members (owners) or by a designated manager.
- Duration: Arizona allows LLCs to have perpetual existence, but you can specify a limited duration if you prefer.
Once you’ve gathered the necessary information, file the Articles of Organization with the Arizona Corporation Commission. The filing fee for this document is $50.
Processing times for your LLC filing typically range from 14 to 16 business days, although you can expedite the process for an additional fee if you need it done more quickly.
4. Complete the LLC Publication Requirement
Once your Articles of Organization are filed, Arizona requires you to publish a Notice of LLC Formation in an approved newspaper. This requirement is designed to give notice to the public that your LLC has been formed. This step is only necessary for LLCs located in counties outside of Maricopa and Pima, but it’s important to know whether it applies to your LLC.
The publication process involves:
- Choosing a Newspaper: The Notice of Formation must be published in a newspaper that is approved by the Arizona Corporation Commission. The newspaper should be one that is published in the county where your LLC’s statutory agent is located.
- Ad Placement: The ad must run once a week for three consecutive weeks.
- Affidavit of Publication: After your Notice has been published, you’ll receive an Affidavit of Publication from the newspaper. This document confirms that you met the publication requirement.
Once you have the affidavit, you must submit it to the Arizona Corporation Commission. The publication fees vary by newspaper but typically range from $30 to $100, depending on the publication and location.
5. Create an Arizona LLC Operating Agreement
Although not legally required in Arizona, it’s highly recommended to create an LLC Operating Agreement. This is an internal document that sets out how your LLC will be managed, how profits will be distributed, and what happens if one of the members wants to leave or if the LLC is dissolved.
The Operating Agreement provides clarity in case of disputes, ensures that all members are on the same page, and can help maintain the LLC’s limited liability status. Even for single-member LLCs, an Operating Agreement can be valuable.
Some key provisions that should be included in your Operating Agreement:
- Ownership Structure: Who owns the LLC and in what percentages.
- Management: Who will manage the LLC, and what powers do they have.
- Distributions: How profits will be divided among the members.
- Dissolution: How the LLC will be dissolved, should that situation arise.
While you can draft your own Operating Agreement, many business owners opt to consult an attorney to ensure that it is legally sound.
6. Obtain an EIN for Your LLC
An Employer Identification Number (EIN), also known as a Federal Tax Identification Number, is a unique number issued by the IRS. It’s required for tax purposes, and you’ll need it if you plan on hiring employees, opening a business bank account, or filing taxes as a corporation.
You can apply for an EIN online through the IRS website. The process is free, and you’ll typically receive your EIN immediately after completing the application.
Even if your LLC has no employees, it’s a good idea to obtain an EIN to keep your business finances separate from your personal ones. This will help protect your personal assets and streamline the tax filing process.
What to Do After Your LLC Is Approved
Once your LLC is officially approved and registered, there are a few additional steps you should take to ensure that your business remains in good standing with the state.
Open a Business Bank Account
To separate your personal and business finances, you’ll need to open a dedicated business bank account. This is crucial for maintaining the limited liability protection of your LLC, as it ensures that your personal assets are protected in case of legal issues or financial disputes.
To open a business bank account, you’ll need:
- Your EIN
- A copy of your Articles of Organization
- A copy of your LLC Operating Agreement (if applicable)
Having a separate business account will also make accounting and tax filing easier down the line.
Apply for Necessary Business Licenses and Permits
Arizona, like every state, has certain business licenses and permits that may be required depending on your business type and location. The specific licenses you need will depend on:
- What type of business you’re operating: For example, a restaurant will require health permits, while a construction business might need specific trade licenses.
- Where your business is located: Some cities or counties have their own business license requirements.
Check with the Arizona Department of Revenue, as well as local city or county offices, to ensure that you’ve obtained all the necessary licenses and permits.
Understand Arizona LLC Taxes
In Arizona, LLCs are generally not subject to state-level franchise taxes. However, there are still tax obligations that you should be aware of:
- State Income Taxes: Arizona imposes a state income tax on LLC profits that are passed through to members (if the LLC is treated as a pass-through entity).
- Transaction Privilege Tax (TPT): This is a sales tax that businesses must collect on goods and certain services sold in Arizona. If your LLC sells taxable goods or services, you will need to obtain a TPT license.
- Federal Taxes: Depending on how your LLC is taxed (either as a sole proprietorship, partnership, S-corporation, or C-corporation), you will need to file the appropriate federal tax returns.
Consult a tax professional to ensure that your LLC complies with all applicable state and federal tax requirements.
Arizona Corporation Commission Contact Info
If you need help during any part of the LLC formation process, the Arizona Corporation Commission (ACC) is the agency responsible for processing business registrations in the state. You can contact them for more information:
- Website: https://www.azcc.gov
- Phone: (602) 542-3026
- Mailing Address: 1300 W. Washington St., Phoenix, AZ 85007
The ACC’s website offers a wealth of information, including guides and FAQs for business owners.
FAQs
How much does it cost to start an LLC in Arizona?
The base filing fee for the Articles of Organization is $50. Additional fees may apply for expedited services, publishing the LLC formation notice, or using third-party services, such as Registered Agents.
How long does it take to form an LLC in Arizona?
Filing with the Arizona Corporation Commission typically takes 14 to 16 business days. However, you can expedite the process for an additional fee if you need your LLC formed faster.
Do I need an Operating Agreement for my Arizona LLC?
An Operating Agreement is not required by law in Arizona, but it is highly recommended to clarify your LLC’s internal structure and prevent any potential disputes.
Can I form a single-member LLC in Arizona?
Yes, Arizona allows for single-member LLCs, which can provide the same liability protection and tax benefits as multi-member LLCs.
