Forming an LLC (Limited Liability Company) in Arizona is easy and affordable. The following are few procedural steps on how to start an LLC in Arizona. LLCs can be formed in two ways, domestic and/or foreign. If you are planning to set up an LLC in states other than Arizona, visit How to Start an LLC.
On this page, you’ll learn about the following:
- Why an LLC in Arizona
- How to Start an Arizona LLC
- After Starting your Arizona LLC
- Best Business Opportunities in Arizona
Why an LLC in Arizona
Arizona is located in the western part of the nation. Industries such as copper mining, cotton trading, fruits, tourism, and ranching, Arizona has become one of the diverse economies in America. Starting an LLC in Arizona is easy and hassle-free. Mostly, there are a number of incentive and tax credits that encourages people to start their businesses in Arizona.
- Angel Investment Tax Credit – An individual can enjoy up to 35% of the total investment as incentives under this program. An investment made to the ‘Bioscience Enterprises’ will be qualifying for this program and can enjoy tax benefits.
- Innovative Programs – To encourage the innovative challenges, the Arizona state offers an Innovative Challenge Grant. Up to $1.5 million can be received under this program to encourage tech innovations in the initial stage.
- Various Other Incentive Programs – Foreign Trade Zone, Small Business Innovative Research, Healthy Forest Enterprise, Arizona Job Training program, and some other programs are available in the state. Under these programs, entrepreneurs can enjoy tax incentives while starting an LLC.
Enterprise Zone Programs
Like Alabama, there are some Enterprise zones in Arizona. If your LLC is operating or located in those specific areas, you may get qualified for financial support. The local government provides various incentive programs to entrepreneurs to encourage more business and economic improvement of the under-developed areas.
How to Start an Arizona LLC
Suppose you’re planning to invest in some profitable business or maybe about to set up your corporation in Arizona. In that case, forming an LLC in Arizona is the simplest option for you.
An LLC or a Limited Liability Company a hybrid business entity combining a corporation’s characteristics with a partnership or sole proprietorship. This section gives you a step-by-step guide on How to Start an LLC in Arizona.
Step 1: Decide a Name for Your LLC
If you are to start an LLC in Arizona, the first thing you do is decide on a business or company name, and how to name your LLC may be tricky. Thus, you have the option to choose a name that complies with the Arizona business naming requirements. It must also be easily searchable for potential clients. Here is a step-by-step guide to follow when naming your Arizona LLC.
Why do you need a proper business name?
If you want your LLC to have special identification, your company name is essential. However, many people face lots of issues by avoiding focus on choosing a business name for their LLC business formation filings.
Because of this, here are some of the major benefits of choosing the best LLC corporate names.
- To help establish a company’s presence in the market, a proper business entity type will help you. This also creates a new identity that will resemble your LLC.
- After you’ve properly chosen the name for your LLC, you will have no problems finishing the registration process.
- You can only get the EIN number when you have your name registration certificate with you.
What are the requirements when deciding a name for your LLC?
A name search is vital to make sure your business’ name is unique. Check the availability of your name with Business Entity Search on the Arizona Secretary of State’s website. Reserve the name by completing the Name Reservation Request Form for Domestic Entities.
- Don’t include words that could confuse people about your company. Words like ‘treasury, state department.’
- You should also avoid restricted words like ‘bank, attorney, university,’ because they may require a lawyer and more paperwork.
- As for a business website and your URL name, check if your name is still available for domain use with NameCheap.
Reserve a business domain
Even if you don’t have plans to set up a website today, it will help if you buy a domain to avoid others from using your name for their website, so do visit NameCheap for your domain name and Kinsta for web hosting.
If you have decided on your URL name and have reserved it, set up a professional email account with Google GSuite.
Step 2: Assign a Registered Agent in Arizona
A registered agent, or business entity, is a person that will act or work on your behalf. This person or business will receive significant tax forms, legal documents, a notice of lawsuits, and other official government correspondence in Arizona. Choosing Arizona-registered agents for your LLC is required.
Make sure your registered agents are residents of Alabama. It could also be a business. Here are the recommended agents and employees for you:
These five LLC formation services are recommended agents’ registered services as they are authorized to conduct any type of business or corporation in Arizona. Compare them to check the best yet cheapest option for you. Besides, they can guarantee you professional service because they have been in the business for years.
Step 3: File Articles of Organization in Arizona
A Certificate of Name Reservation is needed to file a Certificate of Organization, as other states call it. You need to make reports of this certificate with the Arizona Secretary of State. You may file them online, but pay the filing fee of $50.
This Certificate of Formation is a legal document needed to form your business officially. It will indicate details about your LLC in Arizona, like if it is a member-managed or managers-managed.
Before you start processing the government filings, you must already have your LLC name and registered agents or employees. You will attach a copy of your Name Reservation Certificate along with a list of the services that your Arizona LLC will offer.
How to File Online
Go to the Secretary of State Online Service. Select “non-subscriber.” Fill out the online forms. The website will alert you if your county does not support online filings after selecting your principal county.
Step 4: Meet Arizona LLC Publication Requirements
Any newly formed LLCs in Arizona must publish a Notice of LLC Formation. This should be done in three consecutive weeks in any approved newspaper in Arizona. Do this within 60 days upon formation.
Step 5: Create Your Arizona LLC Operating Agreement
An operating agreement is a document that legally outlines the proprietorship and operating procedures of your LLC This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
Starting an LLC in Arizona does not require you to have an operating agreement, but it is ideal to have one that contains all your details of business operation.
Step 6: Filing an Arizona LLC EIN
The Employer Identification Number or, simply, the E.I.N. is a nine-digit number given by the Internal Revenue Service (IRS) to make it easier to identify types of business for tax purposes. It is like a Social Security number dedicated to a business.
It is also called a Federal Employer Identification Number (FEIN) or a Federal Tax Identification Number (FTIN). You will need this number for tax filing and to determine tax classification options.
Internal Revenue Service
Attn: EIN Operation
Cincinnati, OH 45999
Fax: (855) 641-6935
After Starting your Arizona LLC
After forming your LLC, there are still some things that you will need. Take note of the following:
- Get a company business account
- File Arizona business permits & licenses
- Get liability for business insurance with coverage for employees
- File an Arizona LLC annual report or biennial report
- Already existing LLCs that wish to operate in Arizona must register as a foreign Arizona LLC.
This page has provided you with steps to LLC formation and filing processes. You now have to remember upcoming filing deadlines and filing fees or filing costs, including fees for late filings to make sure your LLC is up-to-date.
Best Business Opportunities in Arizona
If you want to form an LLC in Arizona, then what to do must be the first question you need the answer to. There are many businesses that are successfully established in Arizona and are contributing to the GDP of the state, but there are some new rising businesses. The list of such businesses is mentioned below.
1. Interior Designing Business
If you are having some good combination-making skills and love to decorate homes and places, then you can choose the interior designing business. It is one of the best and flourished businesses in Arizona as the prices people are ready for pay per hour are very high. All you need to have is some skills and convincing powers, and you are all set to go.
2. AC Installation And Repairs Business
If you look at the weather condition of Arizona, then it is one of the hottest states of the United States of America. That is why the requirement for air conditioning is very high in this state. If you are thinking of starting a new LLC in Arizona, you can pick up the option of AC installation. Also, it is advised that you create a repair service as it is a recurring service that will make you more money.
3. Beverage Shops
Beverage business is also the best choice for an LLC startup in Arizona. These businesses are very low maintenance and in high demand in the state. Due to high-temperature people almost consume a soft and hard drink with their food, due to which this business is also in high demand.
4. Bike Rental Businesses
There are many tourist attraction places in Arizona that bring people to the state to spend their holidays. Now it is impossible for every person to get their vehicle and everyone knows that vacation with their vehicle is the best. That is why the bike renting business is also becoming an excellent choice among people.
Some other small business ideas are:-
· Lawn maintenance Business
· Delivery Business
· Tech Repair Business
Arizona LLC Formation Review
Time needed: 1 hour and 5 minutes.
Just to recap, here are the easy steps again when forming an LLC in Arizona. Click on the steps in this list to read the full detail.
- Name your Arizona LLC
The first thing you must do is to choose a company name, which should include the phrase “limited liability company,” or one of its abbreviations (LLC or L.L.C.).
- Choose a registered agent
In Arizona, it is mandatory to select a registered statutory agent for your corporation. You can check out our list of our 5 Best LLC Services in the United States.
- File a formation certificate
Filing a formation certificate is necessary when forming an LLC. Depending on the state, it could be called any of the following: Certificate of Formation, Articles of Organization, or Certificate of Organization.
- Meet newspaper publication requirements
You are required to publish the formation of your LLC in several publications.
- Create operating agreement
An operating agreement is not a strict requirement but something encouraged when you start an LLC.
- Get an EIN
The Employer Identification Number (EIN), also called Federal Tax Identification Number, serves to identify a business entity like a social security number for taxation of a company.
A “domestic LLC” is one that conducts business in a state where it was formed. Meanwhile, a “foreign LLC” is an existing LLC that extended business to another state.
For Domestic LLCs, it is vital to have a Certificate of Name Reservation and Certificate of Formation. For the foreign LLCs, you must have a Certificate of Good Standing.
The cost to form an LLC varies per state.
Seldom do L.L.C.s use D.B.A. or a ‘Doing Business As’ name nor a fictitious business name. However, if you want to have one, you make read more about DBAs here.
This document is vital as it ensures that all business owners are on the same page regarding how they operate, thus reducing future conflicts.
>Your name should have “L.L.C. or LLC” or the phrase “limited liability the business.”
>Do not include words that could create confusion between your LLC and any government business.
>Words like ‘bank, attorney, university’ are restricted as well.
>Lastly, your name should distinguish from other limited liability corporations, limited partnerships, or registered limited liability partnerships.
Typically, you can file your LLC name online or by mail. Check with the state where you will set up your LLC name. Take note that the fees for business names may also vary per state.
As for a website and your URL name, check if your name is still available for URL use with NameCheap to see if your name is available as a web domain. Even if you don’t have plans to set up a website today, it will help if you buy a URL. Buying it can help to prevent others from getting your name; check out WPEngine, Kinsta, and GoDaddy for hosting and building your website.
No. Never mail these documents or payments to the Secretary of State directly.
The reason you might need an E.I.N. is that it would help for three reasons:
>Opening a business bank account
>Filing and managing federal and state taxes
>Hiring employees or agents
You are not required a Social Security number when getting an EIN. You can proceed to fill out I.R.S. Form SS-4 and leave section 7b blank. You must then call the IRS at (267) 941-1099 to complete your application. Agents or employees will help you with that.
International EIN applicants do not need an SSN to get an EIN.
The Arizona Corporation Commission cannot advise you whether or not you will be subject to the transaction privilege tax. When you’ve formed your business with the Arizona Corporation Commission, received the necessary business licenses, and obtained your EIN, you’re going to want to start marketing your goods or services. The profits, losses, and other tax items of an LLC taxed as a partnership are passed to the members of the company pro-rata according to their ownership and included on the members’ federal income tax returns. Ask us about Multi-Member LLCs, Federal Tax Purposes, Personal Liability Protection, Entity Type, Business Debts, Business Address, Business Structures, Registered Agent Service, Professional Services, Federal Taxes, Limited Liability Protection, Statutory Agent Service, Personal Asset protection, Entity for Tax, Legal Entity, Business Privilege Tax, Income Tax Liability, Formation Requirements, Additional business Licenses, Legal Liability or anything from the article in the comment box below.