Getting started with a new company always takes time and effort, and if that company is an LLC there’s more to be considered. The rules, regulations, and requirements for this type of business entity are different from what is required for other types of businesses, so it’s important to follow the legal guidelines carefully. Fortunately, Arizona’s requirements are not that difficult, allowing for the creation of an LLC in the state with relative ease.

Getting Started

Naming the LLC

The first thing that needs to be done is naming the LLC. While this does not seem difficult, it’s not always possible to simply pick a name and use it. Another company may have already registered that name, or it may be restricted or prohibited in a way that the LLC cannot use it. Generally, restricted words (such as Bank) require more paperwork, or a licensed individual to be part of the LLC. Words that are prohibited cannot be used at all, because they belong to federal and state agencies and could cause confusion. Additionally, the LLC should see if the domain name is available for their chosen name, and remember that Limited Liability Company or its abbreviation must appear in the name, as well. Searching online will help determine what names are and are not available.

Selecting a Registered/Statutory Agent

A registered, or statutory, agent is someone who is authorized by an LLC to receive official correspondence. It can be a person or a company, but there are some caveats to follow. First, if it’s a person they must be a resident of the state. Second, if it’s a corporation they must be authorized to do business in the state. Someone in the LLC, including the owner themselves, can be chosen as a registered agent, or someone outside of the company can be chosen. The important part is to select someone who is trusted, and who will be readily available the majority of the time.

Filing Articles of Organization

Arizona requires the filing of Articles of Organization for a Domestic LLC. There are a number of documents that need to be filed under that heading including the actual Articles of Organization, the statutory agent acceptance form, the manager structure attachment, the member structure attachment, and the coversheet that provides basic information so that it can be processed correctly. The cost to file this paperwork is $50. Additionally, a Notice of Organization must be published within 60 days. Fees for that publication vary, depending on the newspaper used.

Creating an Operating Agreement

Arizona joins the majority of other states in that it does not require an operating agreement for an LLC to be formed. However, many LLCs still create one of these agreements just to have a clearer pictures of everything. Any LLC that chooses to do so will not have to provide that document to the state.

Running Your Business

Getting Your EIN

What’s an EIN?

An EIN is an employee identification number, issued by the Internal Revenue service. Sometimes it is also called a Federal Tax Identification Number. It’s a unique number issued to each business.

You’ll need an EIN to

  1. Open a business bank account.
  2. File Federal and State Taxes
  3. Hire employees.

Before you get your EIN:

  1. Make sure your new business has been properly formed before applying.
  2. Be wary of paid sites. EINs are free direct from the IRS.

How do I get an EIN?

  1. Apply online: The easiest way is to apply online for an EIN. Note, the IRS website has office hours, and is only available Monday through Friday, 7am to 10pm. Yes, we also agree this is one of the most ridiculous things we’ve ever seen.
  2. Call: You can call 1-800-829-4933, between 7am to 7pm of your time zone, Monday to Friday.
  3. Snail Mail – You can download the form and mail it in.

Keep Business and Personal Accounts Separate

  1. Get a business bank account for your business. This will help you protect your personal assets from potential creditors and lawsuits, and will also make life A LOT easier come tax time.
  2. Get a business credit or debit card. This will help you keep your expenses separate and easier to track.

Accounting

No matter what business you run, accounting software and processes is a must for any small business. If you have an accountant, ask them which software they work with and recommend.

A good accounting system is necessary to:

  1. Track income and expenses, so you can easily see if you’re making money
  2. Makes filing income taxes so much easier.

Always try and find something that will:

  1. Sync with all of your bank and credit card accounts automatically – not just downloads, but auto sync.
  2. Automatch vendors, customers and other accounts.
  3. Let you accept credit cards and ach drafts with ease.

Setting Up for Taxes in Arizona

Hiring employees and paying taxes as an LLC, along with getting a bank account, requires an EIN. Additionally, Arizona will need the LLC to register for taxes and permits. The number of permits required and their costs will vary depending on the business and its location.

Unemployment

The unemployment compensation tax is one of the requirements for the state of Arizona.

Income

Arizona requires that any LLC with employees pay the employee withholding tax.

Sales Tax

Sales tax is generally required, but some LLCs offer goods and services that are not considered taxable.

Getting Insurance for your LLC

Arizona requires Workers’ Compensation insurance, so an LLC will have to purchase this insurance to be in compliance with state laws. However, other types of insurance may also be desirable, even if they aren’t required. That can include liability insurance for the building and the employees, and other options that protect the company and its people from accidents, injuries, and lawsuits.

Keeping Your LLC Compliant

There are specific hiring requirements set out by the state of Arizona, and these have to be followed by every LLC doing business there. These requirements help to ensure fair and just treatment of workers, and also reduce the chances of a company hiring workers who are not authorized to legally work within the United States. There is an annual report filing required for an LLC in Arizona, and a Certificate of Good Standing can be obtained online for a $45 fee.

How to File a Foreign LLC in Arizona

Registering a foreign LLC in Arizona requires the filing of several forms, including the application for registration, the statutory agent acceptance form, the coversheet, the manager structure attachment, and the member structure attachment. The cost for registration of a foreign LLC is $50, and there are requirements that have to be met.