Starting a company

How To Start An LLC In Arizona

Key Takeaways 

  • A limited liability company is beneficial as there is no financial risk and plenty of tax advantages. However, individuals who want to create their own LLC must consider certain things before deciding. There are some steps through which you can build an LLC anywhere you want.
  • Before starting an LLC in Arizona, one must have enough knowledge about how it works. These companies differ from others in many aspects, and you should consume as much information as possible regarding it. 
  • Forming an LLC seems like a long task, but it only takes a few days or weeks. You can complete the entire procedure without problems by following the steps carefully. One thing that you should know about Limited Liability Companies is that every state has a different set of rules and regulations. So, you must first read the laws about LLCs of the chosen state. 
  • The procedure involves fulfilling some requirements. Anyone with the necessary documents can quickly complete the entire process without issues.

Many business owners consider starting an LLC because it has various benefits. Many things make it a good decision. An LLC involves more than one party. So, the financial risks are not a matter of concern. Zero or fewer financial risks allow the parties to continue their business without any hurdles. Well, there are challenges to maintaining the reputation of an LLC. But it is still a good option if you are not ready to take many risks.

The most significant disadvantage of an LLC is that if any member leaves it due to death or bankruptcy, the other members cannot continue the organization. They must create a new one and do all the steps required to restart that limited liability company. Some people get confused between an LLC and a partnership. Even though these two options seem similar, they are different from each other. The members of an LLC keep their business and private assets separate.

On the contrary, a partnership involves members that can keep their business and personal assets together. They can also use them whenever needed. So, there are no restrictions to their usage. 

A partnership doesn't dissolve when a member leaves the organization. However, an LLC will end once a member is not present with the team. There is a way to restart the business by completing the entire process again. For this, they have to first dissolve the current one. An LLC is a combination of a partnership and a corporation. It has mixed both of these ways of doing business. 

If you plan to start an LLC in Arizona, you must take care of the terms and conditions that control everything about LLCs. The higher authorities need to check if every organization is authentic or not. That is why they demand specific documents and other stuff be completed by the members of an LLC. 

What Are The Steps To Follow For Starting An LLC In Arizona?

Arizona is an established state that has gained attention from many people. That is why people who want to start their businesses prefer this place. Therefore, Arizona is the perfect state for forming an LLC. You can get all the advantages after some time once you choose to build it in this state. 

As mentioned earlier, every state or country has a different set of rules and regulations regarding opening an LLC. You have to follow them, no matter what. Now, you can also take help from a professional. They will give you the proper guidance, and from that, you can begin your journey to becoming an LLC member or owner. You can avoid mistakes in the process after researching well enough about everything. Here are some steps to help you understand how to start an LLC in Arizona-

  • Select a name: The first and foremost thing you must do is select a name for the company. The name is crucial because it will help individuals recognize your company. The abbreviation for limited liability company will also be present in the name. It should appear after the name of the company. The abbreviations for LLC are L.C., LC., and L.L.C. If it is a professional limited liability company, the abbreviations will be P.L.L.C, P.L.C., and PLC. All these abbreviations need to be checked by the 

Nobody should copy the name of any other organization as there is a chance that they will approach higher authorities. It also creates problems for new LLCs because they have to face higher authorities' questions and answer them honestly. You have to check if the name is repeated or not on the list prepared by the Arizona Corporation Commission. It is more convenient to search as the information is on the web. You can search for the name you have chosen. If it is on the list, you have to change the name accordingly. 

Choosing a name is a challenging task. However, you can make it a little bit easier by analyzing some things. The niche of your company is an essential thing to consider when deciding on a name. It will give you some ideas as well. You can also take some inspiration from other limited liability companies but make sure you never use the same name. A professional lawyer will help if you cannot find a good one for the organization. 

The business's name should not have a term that reflects a government agency—for example, the State Department, FBI, etc. You need to avoid these terms according to the requirements in Arizona. 

Select a Statutory Agent: A statutory agent is an individual that receives legal documents for your LLC and does other necessary tasks. You have to select an agent after analyzing some crucial things. The agent should fulfill some requirements to provide you with the service. They are as follows-

  1. The agent should have enough evidence to confirm that they provide registered service to others. 
  2. The agent lives in Arizona and has a legal address in the state. 
  3. The agent should be available during their business hours to receive documents.
  4. A statutory agent needs to have some experience in writing to fill out forms.  
  5. A statutory agent must be present in their office during office hours. Sometimes, their absence causes delays in the procedure.

One thing that many people don't know about these agents is that you can also become one. It is a good option if you can handle all these tasks without problems. There is another option for you. You can also pick up an employee working with you as a statutory agent. But they should have the required knowledge. The primary tasks of an agent are to handle the documents and prepare them whenever needed. They will do everything on your behalf. 

Complete the articles of organization to file them: The next step of the process is completing the articles of organization. It is a document where all the information about your LLC will be mentioned. You should fill out the document because the Arizona Corporate Commission will review it. The best thing is you don't need to go anywhere to fill out the form. Now, online portals are open to users. To complete the articles of organization, you need to add the following information- 

  1. The approved name of your LLC. 
  2. The address of the company. 
  3. Services you will provide to other people if the LLC is professional.
  4. Statutory agent's name and address. 
  5. Signature of the business owner.
  6. Description of responsibilities regarding management if the members are allowed to manage specific tasks.

Once you fill out the form and send it, the higher authorities will review the document and approve your LLC in Arizona. It will become a legal enterprise after that. 

Completion of the certificate process: You will receive a certificate after the authorities check everything. This certificate serves as proof that your LLC exists in the state. The overall reviewing process takes a few days. After it is over, you will receive the certificate quickly. 

By showing the certificate, you can apply for an Employer Identification Number, the company's bank account, and other required licenses. So, a certificate plays a crucial role in the overall process. 

Make an operating agreement: This agreement contains all the information about how you will operate your business. It is not mandatory to make an operating agreement in Arizona. But this document will be helpful in many ways. Sometimes, an LLC has to face conflicts and disputes over some things. In these situations, this document will help you resolve disputes efficiently. The courts always look for evidence and proof. You can carry on your business after those issues are resolved. An operating agreement is, therefore, beneficial to create. 

The following information is present in an operating agreement-

  1. The name of your LLC and its address. 
  2. The duration of the company. 
  3. The name and address of the agent involved in the procedure. 
  4. The objective of your LLC. 
  5. The name of the members and their roles. 
  6. The division criteria for sharing profits and losses among the members. 
  7. The details regarding the articles of organization. 
  8. The process of adding members to the team.
  9. The management structure of your company. 

There are other details as well that one can access through this document. The ones mentioned above are the most crucial. 

Notice of Formation: In Arizona, you must fulfill all the requirements to publish a Notice of Formation in a newspaper. You need to continue publishing it for a few weeks. Three will be good enough. This notice has the following details about your LLC-

  1. The name of your company and its address
  2. The agent's name and address. 
  3. The management structure of the company. 
  4. The name and address of the manager or every member.

This document can only be published when you have already met all the requirements for forming an LLC in Arizona. 

Get your LLC Employer Identification Number: Another significant thing you need to apply for is the Employer Identification Number. It is essential for identifying the taxes by the government. Getting this number is now more convenient because online services are available. You can mail to the Internal Revenue Service (IRS) for the same. They will respond to you shortly. Also, ensure to get your documents handy and then request the same. Otherwise, the process will be delayed. 

An Employer Identification Number is essential due to the following reasons-

  1. You can get information about the taxes and manage them accordingly. 
  2. You can open your business bank account once you get the number. 
  3. Hiring employees is another thing you can do easily with the number. 

Final tasks to do: After forming your LLC in Arizona, you have to complete some last tasks. You should register the business with the tax agency. You must have a credit card. It will be beneficial for you in the long run. Getting insurance is a good thing for your LLC as it will protect it in certain situations. You need a trademark for your company's name and logo. 

The Bottom Line 

Forming an LLC in Arizona looks like a complex procedure. But in reality, it is not complicated if you follow the above steps carefully. It is essential to learn everything before starting the process. It will help you avoid some problems that people usually experience. People get confused because every state has a different set of rules and regulations. Well, you have to read them first. In Arizona, you have to take care of specific laws to prevent delays and other difficulties. The members of your LLC should also be knowledgeable enough to help you in the process. 

We hope this article helped you understand the entire procedure in detail. You can now prepare to create an LLC in Arizona without any issues. 

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At Levy, we help early-stage founders streamline and automate regulatory and legal ops, HR, and finance so you can focus on what matters most — your business.

We can provide sufficient information to guide you in starting a limited liability company in Arizona. In this way, you can avoid some common mistakes and errors that people usually face in the process.

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Note: Our content is for general information purposes only. Levy does not provide legal, accounting, or certified expert advice. Consult a lawyer, CPA, or other professional for such services.

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