How to Start an LLC in Arizona (Step-by-Step) 2023 Guide

37 comments on “Arizona LLC”

1. Great information, Matt!

   When should I purchase/register a website? As soon as possible under my personal account so it is not taken by someone else and then transfer to the LLC or only after the LLC is officially created?

   • Thanks Ethan! That’s exactly what I’d do ;) Then after your LLC is approved, you can transfer the domain names to your LLC. Hope that helps :-)

2. Hi, Matt. My husband and I have two rental properties and are considering putting each one into their own LLC. We have been told that our LLCs should be put into a revocable trust — with a holding company in between the two.
   Though we have heard, we should do that, we haven’t heard a reasoning for it. And how does an LLC get put into a revocable trust, anyway? Thank you.

   • Hi Cindy, you’ve been advised well. The reason to create an LLC holding company is consolidate and make things more organized. It also has some added asset protection. Additionally, it simplifies federal tax filings, as all child LLCs (aka subsidiary LLCs) would report their income/loss on the parent LLC’s (aka holding company LLC) tax return.

     Then the purpose to have the Trust “at the top” owning the parent LLC is to make the transfer of these companies (and their real estate holdings) transfer to your beneficiaries without having to go through probate, after the passing of you and your husband.

     • You’d first create the Trust (I recommend working with an asset protection and estate planning attorney)
     • Then you’d create the parent LLC. The parent LLC would be 100% owned by the Trust (this would be documented in the parent LLC’s Articles of Organization and Operating Agreement).
     • Then you’d create the child LLCs, which would be owned by the parent LLC.
     • Then you’d deed the rental properties from your name into their respective child LLC.

     Hope that helps!

3. Hi Matt,
   We are looking at creating a multi-member LLC in Arizona for a houseboat trailer. This is not a business or for profit, just an asset. Do we use the same process to create the LLC as if it was a business? Or is there a better way to do this? Any help would be greatly appreciated. Thanks!

   • Hi Deanna, yes, the process of LLC formation in AZ is exactly the same, whether the LLC will operate a business or simply hold title to assets.

4. Hello, Mr. Horwitz. Your article says that to open a bank account, a “stamped and approved” Articles of Organization are required. How to get this paper, which is to be “downloaded for free from their database”, stamped and approved? Thank you. Michael

   • Hi Michael, yes, the approved Articles of Organization that you’ll download from the Arizona Corporation Commission’s website will be stamped and approved. Hope that helps.

5. Hey Matt!

   Thanks so much for all of the information. There are some very comprehensive guides you’ve managed to assemble here.

   I would like to know also as a US citizen with residence but not domicile (I’m living abroad long term) in Massachussets..

   I am going to manage short term vacation rentals (doesn’t require a real estate license… but maybe… another?)

   I won’t be physically in Arizona much, but I will contract out some small jobs to other firms or individuals i imagine paying independent contractors in the state doesn’t constitute as doing business in the state… but what is your opinion? Given my situation should I register my LLC in Arizona or perhaps choose another state for tax reasons?

   • Hey Landon, you’re welcome! Where an LLC should be formed (or registered as a foreign LLC) comes down to where it’s legally transacting business. With properties and rents being collected in Arizona, you’ll be doing business in Arizona. Regarding any real estate licenses/permits, you’d need to check with the municipality where the properties are located. We’re not sure. We don’t specialize in licensing and there are over 70,000 licensing jurisdictions in the US! Hope that helps :)

6. Hello Matt,
   First thank you for the wealth of information on your site.

   I am a current independent contractor working with multiple companies all from the comfort of my home. And since I am legally considered being in business for myself as a independent contractor I have definitely decided to create a single member LLC in Arizona the state I reside in, for the benefits the llc offers. Here is my question:

   As your article states I might need certain business license and permits for operating my business. Do I need a business license or permits since I’m working from home as a Independent cntractor? Would i be breaking zoning laws if i form an llc & work from home as a independent contractor? Could i be kicked out of my apartment for working as a independent contractor and owning a llc for said independent contractor business?

   • Hi Elayliah, you’re very welcome! No, you won’t be kicked out of your apartment for failure to obtain a business license, if it were required. Business licensing rules are usually administered at the municipal and/or county level, so you’ll want to contact your city (or town) and the county to check on if a business license is required for a home-based business. Hope that helps!

7. Matt,

   Excellent guides, thank you. I am forming an LLC with 2 partners in order to passively invest into a fund that invests in Real Estate. My research says that because we are passive investors, we would not trigger “doing business” in any particular state. We’ll be subject to state taxes in states where the fund generates rental income from properties. However, state taxes shouldn’t guide where we form the LLC, rather, the “doing business” principle should because that’s what would trigger us having to register the LLC in other states. Because of this scenario, we are looking to form the LLC in a state with the lowest fees possible, even if we have to hire a registered agent (Arizona, New Mexico, or Idaho). Is this consistent with your understanding of LLC filings?

   • Hi Juan, I believe your findings are correct, but I’d recommend running them by a tax and/or legal professional. Thanks.

8. Hello Matt,

   Is there any benefit to creating personal LLCs for each member of a new LLC that we will be creating together? I have heard people state that having this extra level of ownership increases protection against liability but are there also tax benefits? I hope this question makes sense lol.

   Thanks

   • Hi Talbot, we’re not sure about any tax benefits from this. We recommend speaking to a few accountants. Feel free to share any findings if you’d like. Thanks.

9. Hi.

   I’m a Canadian citizen/resident, looking to form a LLC in the US.

   Can a non-US citizen form a “domestic LLC” in Arizona with a Arizona Statutory agent — use their address as the principal business address?

   Thanks

   • Hey Justin, yes, a non-US citizen can form a Domestic LLC in Arizona using the Commercial Statutory Agent’s address as the LLC’s Principal Address (if said Commercial Statutory Agent allows), however, LLCs owned by Canadians usually face double taxation (the IRS and the CRA). We don’t know the details, but I’d discuss this with a professional who works both sides of the border. I believe another entity may be a better choice from a tax perspective. Feel free to share any findings if you’d like. I’m curious to hear what you come up with. Thanks.

10. Hello Matt,

    I’m considering forming an LLC for a small game studio. If I had a partner in another state, does it matter which state the LLC is formed? No sales would occur for quite a while and when they do, it would only be on an online marketplace. Also, in Arizona, is there ever a renewal for the LLC or is it always considered “active”.

    • You can usually pick either state unless there is substantially more business activity taking place in one state versus the other. An Arizona LLC has no annual report requirements or annual fees that need to be paid to the Arizona Corporation Commission (AZCC) and therefore, you’re correct, it will perpetually be in existence. Hope that helps!

11. Hey Matt, I live outside the United States and run a logistics/freight company, I am considering forming an LLC and looking at Arizona, Wyoming, Delaware and Texas. Presently, we don’t make any income in the USA as all our clients purchase items in the USA and ship out to countries in Africa and Asia. Where would you advice, we form our LLC? Considering filling fees, annual reports and taxes.

    Presently, we use a 3rd party logistics company operating out of Texas and Georgia to get shipments out of the USA would this have any influence on where we should form our LLC?

    Thank you

    Great job by the way

    • Hey Dave, I would recommend looking further into tax considerations (federal and state). If you’re a non-US resident, you may have Effectively Connected Income (ECI) and/or there is a chance you may be “engaged in trade or business with the U.S.” via an independent agent. If you’re a US citizen, it’ll depend on how you file your federal return, where your tax residency is established, and more. However, this is not a subject we get into so you’ll need to speak with an accountant and/or an attorney. Thank you for your understanding.

12. Good morning Matt,

    In “2016” I received certified mail stating that 25% of a previous job wages were going to be garnished, but I had already changed employment. After research I discovered that in “2010” a judgement was filed in Santa monica, CA civil court against me. I never received any previous notification. The judgment was for some apartment the I never lived in. I’m living in the state of Arizona. I have not heard anything about this matter since 2016. My question is if I open a business account with my new LLC, will they be able to freeze my account, because my ssn is attached to my business checking account? and if the judgement was filed in “2010′ is there some sort of statue of limitations? I thought it was 7 years in California.

    Thanks

    • Hi Tiey, we’re not able to comment on questions such as this as you’ll need to speak to an attorney. Thank you for understanding.

13. Hi Matt,

    I have a TIN for my DBA, and now want to “convert” to LLC. Will the IRS transfer the current TIN, or will I need to get a new one? The business name isn’t changing, except to add LLC.

    Thanks much!!

    • Hi Diana, the IRS will not automatically transfer the EIN from the DBA to your LLC. You can transfer the EIN by sending a letter to the IRS. More info here: convert Sole Proprietorship to LLC. Or you can cancel the EIN and then get a new one for your LLC. Cancelling and then getting a new EIN is usually easier and guarantees “cleaner” records (less confusion). Hope that helps.

14. Hi Matt,
    I use to live in Florida and New Jersey. Currently living abroad mostly traveling but also running an online travel agency(and other mostly online projects which allows working remotely). Although a non resident I need to register an Arizona LLC(or wherever makes more sense) to gain access to some large cruise lines tools for travel agents(it’s their requirement to be registered in US). However the business is operated online(various countries depends where we are ) and won’t operate in a particular US state. What are your thoughts on this? How non residents should register a LLC in this case? or should I go for it as sole proprietor?
    Many thanks

    • Hey Cris, we don’t recommend a Sole Proprietorship over an LLC for liability reasons (see LLC vs sole proprietor). Do you file income taxes at the state level? Since you’re likely not doing business in any particular state by the nature of you residing/living there, you likely have all states open to you. And the decision should then be more influenced by taxes, so we recommend speaking with an accountant to discuss strategy. Hope that helps.

15. My Arizona LLC company sells home seller leads to retail merchants and insurance companies nationwide. Does my LLC have to file as a foreign LLC in other States?

    • Hey Tom, no, likely not, unless you are “doing business” in those states. “Doing business” has much more to do with where you are operating from, not where your clients are. Hope that helps.

16. I have a client who develops apps and operates as a sole proprietor, in New York. He is considering forming an LLC, but is afraid of the costs of registering in New York, namely advertising requirements. Is there any reason why he should not register the LLC in Arizona (only a $50 filing fee),and apply to do business in New York? Do the operations need to be done in Arizona?

    • Hey Scott, yes, there are many reasons why he shouldn’t register outside of New York, since that is where he is legally doing business. Check out “best state for LLC” for more info. If he forms an LLC in Arizona, but is doing business in New York, he’ll have to register the Arizona LLC as a Foreign LLC in New York. Also, if he follows our New York LLC course (follow the lessons in order), we explain how to save money on the newspaper publication costs. Hope that helps :)

17. Hello Matt. From what I am reading it’s best to form the LLC in the state the property is in.

    Our scenario. We live in Indiana but have purchased property in Arizona as an investment property not a second residence.

    Thank you,
    Sally Carlton

    • Hi Sally, yes, that is correct. The LLC should be formed in the state where the property is located since that is where you are legally doing business. Hope that helps.

      • Are they required to also the Arizona LLC as a foreign LLC, and form an LLC in Indiana where they live?

        • Hi APB, usually no, unless it’s California. They would not need to register the Arizona LLC as a Foreign LLC in Indiana. And they would not need to form a Domestic LLC in Indiana (if they form a Domestic LLC in Arizona). The business is being done in Arizona, so that’s where the registration should take place. Here’s a related article: Domestic LLC vs Foreign LLC. Hope that helps.

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