Many Arizona entrepreneurs choose to form a limited liability company (LLC) because of the many benefits of this business entity type. An LLC provides liability protection, for instance, so your assets are not at risk if your business is sued or cannot pay debts.
An LLC is a “pass-through entity” for tax purposes, meaning that the LLC itself is not taxed. Instead, income passes through the business to the LLC owners or members, who report it on their tax returns. LLCs also offer flexibility in terms of management and taxation.
Creating an LLC is relatively straightforward, but ensuring it’s done correctly is crucial to getting your Arizona business off on the right foot. The most critical step is filing articles of organization.
What are Articles of Organization for an LLC?
The articles of organization is a legal document filed with the Arizona Corporations Commission to form an LLC officially. It will include your business name, address, statutory agent information, and more, as detailed below.
First, Select a Statutory Agent for Your Arizona LLC
Arizona requires LLCs to appoint a statutory agent (registered agent), a person or company authorized to accept and respond to official business correspondence, such as legal, tax, or financial documents.
The statutory agent ensures all required notices and documents are received. In Arizona, the statutory agent can be an LLC member, individual, or entity that meets state requirements. In Arizona, a statutory agent must:
- Be 18 years or older
- Have a physical address in the state
- Be available during regular business hours
- Be registered to operate in the state, if it’s a business
Many business owners hire a statutory agent service to ensure their LLC stays fully compliant and for convenience.
If you choose to be your statutory agent, you must be at your statutory agent’s address for all business hours. A statutory agent service allows you to be wherever you need to be to run and grow your business.
How to Submit Articles of Organization in Arizona
To start, visit the Arizona Corporations Commission website and create an account to access the articles of the organization online.
In Arizona, the articles of organization require the following information:
- LLC name
- Principal office address
- Statutory agent information
- Statutory office address
- Management structure
- Member or manager names and addresses
Once you’ve signed into your account, select “Create a new LLC.”
You’ll be prompted to enter your business entity name, statutory agent information, principal business address, organizer name and address, management structure, and member and manager names and addresses.
You’ll then review all your information before proceeding to payment.
The filing fee is $50. You should receive confirmation within seven to nine days if you file online. The turnaround time for filing by mail can be up to three weeks.
Some entrepreneurs hire an LLC formation service like ZenBusiness to handle this step, saving time and ensuring the process is done correctly.
Draft an Operating Agreement
Arizona does not require an operating agreement, but it’s a crucial document that defines members’ ownership percentages and profit allocations. Those are the two key elements, but it should also include the following:
- Each member’s rights and responsibilities
- Management structure and roles
- Voting rights of each member
- Rules for meetings and voting
- What happens when a member sells their interest, becomes disabled, or dies
You can find operating agreement templates online, but it’s best to have them drawn up or reviewed by an attorney. The language of an operating agreement is crucial and can often help determine how member disputes will be resolved. Here you can obtain a free operating agreement template for your Arizona LLC.
Contact Information for the Arizona Corporations Commission
Arizona Corporations Commission Website
1300 W. Washington Street
Phoenix, AZ 85007
Tucson Office (Walk-ins only):
400 W. Congress Street
Tucson, AZ 85701
Phone: (602) 542-3026
Email: [email protected]
Fax: (602) 542-4100
There’s only one way to create an LLC in Arizona: successfully filing articles of organization. If you make any mistakes, you’ll likely have to refile, so be sure to do it right the first time and set your business up for serious success!