The process of registering a business is dictated by state law, so the actual process and timeline varies across the country. In some states, you can register your business and open up shop in less than a week. In other jurisdiction, it can take months to process the paperwork before you receive the green light to launch your business.
Arizona is one of those states that generally takes longer to register an LLC, but with an experienced small business specialist at your side it’s a fairly straightforward process.
How to Create an LLC in Arizona
Creating an LLC in Arizona is easier than you think. After consulting with a small business specialist, there are just seven simple steps to register your business with the proper agencies:
Step One: Choose a Name
Before diving into all of the forms and applications to register your business, you’ll need to settle on a business name. Choosing a name that’s catchy, easily searchable, and has an available domain name should be your primary focus, but it’s also important to follow the state’s naming guidelines:
- Check the eCorp business entity database to ensure your business name is available
- The business name must include the words “limited company,” “limited liability company,” or the abbreviations LLC, LC, L.L.C., or L.C.
- Professional LLCs must include the words “professional limited liability company” or the abbreviations PLLC, PLC, P.L.L.C., P.L.C.
- The business name cannot include the words “incorporated,” “corporation,” “association,” or an abbreviation of these words
- Do not include the words “bank,” “banker,” “banking,” “banco,” “banc,” “banque,” “credit union,” “deposit,” “savings association,” “building association,” savings and loan association,” “savings bank,” “thrift,” “trust,” or “trust company” without prior written authorization from the Arizona Department of Financial Institutions
Most LLCs don’t require registering a DBA (doing-business-as alias) or trade name. However, you’re welcome to register one if you prefer to use another business name for marketing or other purposes.
Step Two: Choose a Statutory Agent
Arizona LLCs are required to nominate a statutory agent, referred to in other states as a registered agent. The statutory agent can be an individual or business entity, and will be responsible for receiving legal documents on behalf of the business. In short, the statutory agent is the middleman between your business and the state.
When the statutory agent is a person, the only requirement is that he or she must be a resident of Arizona. When the statutory agent is a corporation, the business must be authorized to transact business in Arizona.
In most cases, the business owner or founder elects himself/herself to be the statutory agent. However, there are circumstances where it may be wise to elect a third party to this position. There are a number of organizations that offer outsourcing of the statutory agent position for a fee.
Step Three: File the Articles of Organization
Now that you have a business name and a statutory agent, it’s time to register your business with the Arizona Corporation Commission. The easiest way to register your business is online through the eCorp website, but you can file by mail or in person if you prefer.
Should you decide to file by mail or in person, you’ll need to complete four important forms:
- Cover Letter
- Articles of Organization
- Statutory Agent Acceptance
- Member or Manager Structure Attachment
There is a $50 nonrefundable fee to file your LLC registration paperwork with the Arizona Corporation Commission. The standard processing time is 50-55 days, though you can request to expedite your application for an additional fee.
Step Four: Complete Publication Requirements (if applicable)
Businesses whose principal address is outside of Maricopa County or Pima County are required by law to publish a Notice of LLC Formation for three consecutive weeks in an approved newspaper. Businesses have 60 days to comply with this order after forming an LLC.
While this may be a nuisance, the good news is you don’t have to write a whole article about your business. Your Notice of LLC Formation simply needs to include five elements:
- The business name
- The statutory agent’s name and street address
- The address of the LLC’s principal place of business
- Whether the business is manager-managed or member-managed
- The name(s) and address(es) of any LLC managers and members
Step Five: Obtain an EIN
An Employer Identification Number (EIN) is used to identify your business. Sometimes referred to as a Federal Tax Identification Number (FTIN) or FEIN, it’s the equivalent of a social security number for business entities.
Though you don’t need an EIN to register your business with the Arizona Corporation Commission, you will need it for state and federal tax purposes. You’ll also need an EIN to open a business checking account, and when you eventually begin to hire employees.
Obtaining an EIN is easy and free of charge. The IRS handles EIN applications online through their EIN Assistant. You’ll receive your EIN immediately upon completing the online application, and the IRS will mail a formal letter with your EIN to keep in your records.
Step Six: Register with the Arizona Department of Revenue (if applicable)
Businesses that sell physical products or taxable services will need to apply for an Arizona Transaction Privilege Tax (TPT) License. In other states, this is referred to as a sales tax license, tax license, vendor license, wholesale license, or resale license. It is not a business license (business licenses aren’t required in Arizona).
When you’re ready to apply for a TPT License, visit the Arizona Department of Revenue’s AZTaxes Registration Page. If you have any questions regarding your business’ tax liability, you should discuss your situation with a business law attorney or small business tax accountant.
Step Seven: Register your LLC with the city
The Arizona Department of Revenue will handle the collection of all state, city, and local TPT taxes, but you’ll still need to register your business with the city where you do business. The application and registration process varies by city, as do the associated fees.
While the Arizona Corporation Commission doesn’t issue business licenses, many cities do. You should receive a business license from the city in the mail, and depending on local ordinances you may be required to display the license if your business is open to the public.
How long does it take to form an LLC in Arizona?
Though processing times vary depending on the number of pending applications, it generally takes a little under two months to process an LLC registration in Arizona. Most applicants report the process takes 50 – 55 days.
If time is of the essence, you can pay an additional fee for expedited processing. Instead of waiting up to two months, an expedited case should be processed in about 10 days.
Working With a Small Business Attorney to Create Your LLC
Creating a new business is exciting and is filled with important decisions to make, like which type of business entity best suits your business. Understanding exactly which type of business entity your company should use is not always simple, as each business entity type comes with different benefits and drawbacks. Having an experienced small business law attorney by your side will have countless benefits, such as explaining the differences between your options (LLC, Sole Proprietorship, S Corporation, etc.) and the advantages and disadvantages each would have for your company.
JacksonWhite has a team of lawyers dedicated to providing legal counsel to Arizona small businesses. The benefits of working with a small business attorney highly outweigh the costs of hiring one, especially during the early phases of a company’s creation. Contact us today to discuss your business needs and we will help set you on a course for success.
Call JacksonWhite’s Small Business Law Team at (480) 464-1111 to discuss your case today.
