How to Start an LLC in Arizona: Step-by-Step Guide

Written by Tyler Davis – CPA, updated on

Arizona has a long tradition of successful companies.

In the past, people came to profit from the state’s vast mineral resources. Now business owners come for a pleasant community vibe and affordable LLC incorporation costs.

The filing and LLC set up fees in Arizona are reasonable, and the maintenance requirements are minimal.

Arizona Corporation Commission (ACC), Arizona Secretary of State, and local small business associations also provide plenty of guidance.


Steps to Form an LLC in Arizona

Step 1: Choose a Name for Your LLC

The first step is selecting a name for your LLC.

Let your creativity flow to find one that suits your vision. Additionally, ensure it complies with the following Arizona business regulations:

  • Include the word “limited liability company” or an abbreviation such as LLC, Ltd, etc.
  • Avoid words like association, corporation, or incorporated
  • Your name must be unique and distinguishable from registered entities

To check if your idea is available, use Arizona’s business name search tool. Avoid selecting a name that may cause confusion with any existing business.

Arizona LLC search

Name reservation (optional)

A name reservation isn’t required. But it can secure your top contender, giving you time to handle other formation needs.

The standard cost to reserve an Arizona LLC name is $10, which you can do:

In Arizona, you can reserve an LLC name online for $45, which includes a $10 filing fee and a $35 expedite fee.

This allows for immediate reservation, giving it the fastest processing time compared to paper applications. The name reservation is valid for 120 days, allowing you to handle other formalities without rushing.

Trade name (optional)

Registering a Trade Name, also known as DBA (doing business as), is another optional filing.

Using a Trade Name allows you to operate under something other than the LLC’s legal name. This is especially helpful when managing several brands or services under one company.

Register a Trade Name with the Arizona Secretary of State (SOS). The cost is $10 per Trade Name and it may few weeks to process. You can get expedited service for an extra $25.

Step 2: Appoint a Statutory (Registered) Agent

Now shift your attention to appointing a registered agent. This is a critical aspect of your LLC. It serves as the official point of contact for things like legal notices and tax documents.

Arizona calls this role a “statutory agent” and can be fulfilled by:

  • An individual residing in the state of Arizona with a physical address (not a P.O. Box)
  • LLC, foreign corporation, or foreign LLC that’s authorized to do business in AZ

You appoint the statutory agent during the LLC formation process. Then they must respond by filing the Statutory Agent Acceptance form.

If you don't want to be your own registered agent, you can hire one for about $75-$155/year in Arizona.

If you form an LLC with Northwest, they'll give you a free statutory agent for the first year. After that, it's $125 per year.

Step 3: File the Arizona LLC Articles of Organization

The articles of organization serve as the legal document to form an Arizona LLC. It can be an intimidating step. But the process is likely more straightforward than you imagine.

The application for articles of organization form:

  • Business entity type (LLC or Professional LLC)
  • LLC’s name
  • A description of services for Professional LLCs
  • Statutory agent’s name and contact information
  • Business’s principal address
  • Member-managed or manager-managed

Apply for EIN number

Use ACC’s eCorp system for online filings and fast processing. Or you can choose to submit a form by mail or fax.

The filing fee for Arizona articles of organization is $50.

The standard processing time is 30 business days. You can buy expedited processing for $35 to get a 5-day turnaround.

Step 4: Create an LLC Operating Agreement

An operating agreement is a private contract between the LLC members. It lays out the rights and obligations of the LLC members and managers.

Although Arizona law doesn’t force you to get one, don’t overlook an operating agreement. It is critical for a multi-member LLC.

If there’s no operating agreement in place, your LLC falls back to Arizona state law. This may result in unexpected outcomes that don’t align with your desires.

Instead, you can create an operating agreement that dictates how to:

  • Add and remove members or managers
  • Allocate profits and losses
  • Resolve many different types of disputes

You can create an operating agreement using a free or low-cost template. Or seek help from a corporate attorney or LLC formation service to get one customized to your needs.

Step 5: Get an EIN (Employer Identification Number) from the IRS

The Internal Revenue Service (IRS) issues Employer Identification Numbers (EINs). It’s like a Social Security number for businesses. The IRS uses them to track your tax information.

LLCs with more than one member or any employees must get an EIN.

Getting an EIN is quick and free. You can apply and obtain one on the IRS website.

Apply for EIN number

Some single-member LLCs can use the owner’s personal Social Security number. But the IRS requires one if other specific situations apply. These include certain tax withholding, business activities, and retirement plans.

Total Costs to Form an LLC in Arizona

The state fee for LLC formation in Arizona is $50. An extra $35 fee applies for expedited processing.

Most Arizona LLCs need to publish an LLC formation announcement in a local newspaper. This can cost anywhere from $60 to $300.

LLCs in Arizona don't file annual reports, so you won't need to pay an annual report fee.

For the majority of people forming an LLC in Arizona, total costs are anywhere between $110 to $385.

Further Steps

Publish a Notice of the Filing of the Articles of Organization

Arizona is one of three states that have a mandatory publication requirement for LLCs. Other states include New York and Nebraska.

After the state approves your formation documents, the ACC will tell you if you need to publish notice. That’s typically the case for articles of organizations.

You’ll need to pay a newspaper for making three consecutive publications. The fee for this can range from about $60-$300. The ACC provides a list of approved newspapers for you to use.

Once completed, the newspaper will provide an Affidavit of Publication. Although not required, you can file it with the ACC to make it part of your LLC’s public record.

Register with the Arizona Department of Revenue (ADOR)

Many businesses need to register with the Arizona Department of Revenue (ADOR). This authority issues various business licenses.

The registration process is quick and can be done online. Arizona’s Department of Revenue also provides some helpful guides with step-by-step instructions.

Licensing and permits

Certain businesses must get other licenses and permits. These can come from Arizona state regulatory agencies. But many local authorities have requirements too.

Many professional services need a state license, such as contractors and real estate agents.

Before conducting business, make sure your LLC gets what it needs to operate.

Open a business bank account

Unlike a sole proprietorship, business entities can’t mix personal and business funds. If you do, the LLC’s ability to protect your personal assets from a lawsuit can disappear.

Having a business account also makes paying state fees much more convenient. Without one, you’d have to use a check with a pre-printed name and address to pay state fees.

Fees for local and federal banks range. There are many free options if you meet specific requirements. And if not, the fees are still quite minimal at about $20/mo.

Advertisement

LLC Formation Service

LLC Formation: $39 + state fees
Pricing:
Turnaround Time:
Help & Support:
Customer Satisfaction:
Ease of use:

Best LLC Service 2024

  • Formed 1,000,000+ LLCs
  • $39 formation includes registered agent service
  • Fast formation & same day filing
  • Exceptional customer reviews
Last updated: Oct 2024
Tyler Davis

Article by:

Tyler Davis

CPA

Tyler Davis is a CPA and real estate professional. Tyler enjoys working on the tax implications of real estate transactions, evaluating development and investing opportunities, and writing on current tax events. He worked for PwC in tax for five years where he advised on the tax implications of M&A transactions and provided tax provision support for Life and P&C Insurance companies. In his free time, Tyler is an avid golfer.

Small business tips straight to your inbox

Already running a small business? Get free tips to your inbox.

We respect your privacy. We're GDPR compliant.