A certificate of good standing is obtained from the Arizona Corporation Commission, and serves as proof from the state that a company is authorized to do business in the state. Usually, a certificate of good standing is required to be obtained before a business begins to operate as it is required for basic business actions.
A Certificate of Good Standing proves that a company:
- Is a legal entity in the State
- Is not in default of State rules
- Is not currently suspended by the State
- Is current on all tax filings and obligations
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Is a Certificate of Good Standing Required?
One of the most important uses of a certificate of good standing is its use in the process of securing financial assistance from banks. During the process of financing a new corporation a certificate of good standing is required by banks as a way to prove that the corporation/company is legitimate.
Typically certificates of good standing are required for the following instances:
- Opening bank accounts
- Completing an official business transaction or a contract
- Selling of a business
- Proof that a company/business has come back into good terms with the state
If you are unsure of whether or not your company needs to obtain a certificate of good standing, a legal representative with years of experience helping small businesses like yours can assist you in making this important decision.
Who Needs to Obtain a Certificate of Good Standing?
Many types of organizations are able to apply for Certificates of Good Standing by applying to the Arizona Corporation Commission.
The following organizations are able to obtain a Certificate of Good Standing:
- Professional corporations
- Limited liability companies
- Non-profit corporations
For other types of organizations such as limited partnerships, limited liability partnerships and limited liability limited partnerships that do not fit into the above criteria they can request a Certificate of Existence from the Business Services division of the Arizona Secretary of State for a fee of $5.
A certificate of existence is similar to a certificate of good standing, but only limited partnerships, limited liability partnerships and limited liability limited partnerships can obtain it.
How Do I Obtain a Certificate of Good Standing?
There are several ways to obtain a Certificate of Good Standing:
- Online: Ordering a certificate of good standing online through the Arizona Corporation Commission will be the fastest, and easiest way to obtain a certificate. Once the payment for the certificate has been accepted, the finalized certificate will be available as a PDF for download.
- In person: Individuals may bring in their filled out form to the AZCC, but waiting times vary for obtaining the certificate.
- By Mail: A corporation/company may mail their form to the AZCC for processing, but this is the slowest way to obtain a certificate.
How Long Will it Take to Obtain a Certificate of Good Standing?
The quickest way to obtain a certificate of good standing from the AZCC is to submit the form online, by doing this your form can be accepted immediately upon its submission. If a corporation/company are willing to pay an expedited fee they may be able to obtain a certificate in person at the AZCC office that day.
The wait times for receiving a certificate of good standing are as follows:
- Online: Orders are processed as they are submitted and the certificate will be ready to download once the payment has gone through
- In Person and Expedited: If the expedited service is paid for, a certificate will either be mailed that day or made available for pick-up
- In Person Non-Expedited: This option is the slowest and will take a minimum of 14 business days
- Expedited Processing by mail: This process takes up to 10 business days
How Much Does it Cost to Obtain a Certificate of Good Standing?
When filing a certificate of good standing the filing fee is standardized at $10, however depending on the mode of filing, an expedite fee of $35 may also be applied. This means that those who wish to obtain their filed certificate in less than 10-14 days will pay $45.
The online filing option is considered to be an expedited service and it will have a filing fee of $10 and then the $30 expedited fee on top of this for a total of $45. There is not a higher filing fee to obtain the certificate when completing the process online, rather the expedite fee is built in.
If the mode of filing is not expedited and filed by mail or in person by a corporation/company, then the total cost will be $10 before shipping.
If time is not an issue and you are not needing to obtain a loan or open a bank account, visiting the AZCC in person to obtain a certificate is a valid option that will end up being the most cost effective choice for your corporation/company.
What is an Annual Report?
An annual report is legally required by the state of Arizona to be submitted once a year by every corporation in the state. The annual report is a description of any changes that have been made to a corporation/company, examples of things that would be included are address and name changes.
The AZCC does not offer a form for the Annual Benefit Report, and therefore they recommend corporations review statutes (A.R.S. §§ 10-2441 and 10-2442) to determine the requirements for the content of the Annual Benefit Report.
Who Needs to File an Annual Report?
All Arizona corporations (domestic and foreign) are required to file their annual report. This filing will cost $45 and can be completed online or the form can be mailed to the AZCC.
Limited liability companies (LLC) in the state of Arizona do not need to file an annual report with the state, and therefore there is no fee involved.
Nonprofits are required to file an annual report, but their fee is only $10. Just as the corporations, the annual report of a nonprofit can be submitted online or be mailed to the AZCC.
The process of running a business will often have issues arise that are of no fault of the owner or management. Whether it be employment issues or unintentional accidents, having a legal representative to protect your business may be the difference in keeping a business afloat or not.
As your business is taking off, the legal services provided by JacksonWhite are here to help you sustain your growth.