Cost to Start an LLC in Arizona

Key Takeaways

• Arizona offers a welcoming climate for LLCs. Home to a booming economy, low corporate tax rates and a highly skilled workforce, your business will prosper here!
• There are obvious costs associated with forming an LLC in Arizona. These costs consist of a state filing fee (between $50 and $85), statutory agent service fees, and newspaper publication fees depending on your county.
• It’s not hard to keep expenses low! Utilize free resources such as online operating agreement templates and get your Employer Identification Number (EIN) for free.
• Arizona is one of the few states that do not charge LLCs an annual report fee. This policy allows you to save thousands in annual costs relative to other states.
• Staying compliant with tax duties, business licenses, and local regulations is essential to avoid penalties and ensure smooth business operations.
• You can choose between filing your LLC on your own or using a formation service, like Northwest Registered Agent, to streamline the process and reduce common filing errors.

Cost to start an Arizona LLC varies according to the number of required steps and associated fees.

Here is a clear table you can use:

You’ve got each expense easy and laid out before you.

Why Choose Arizona for LLC?

Starting your LLC in Arizona provides you with tangible, practical benefits. The state’s booming economy is attracting new startups and mature companies alike. Together, these two factors mean you enjoy a business climate that’s open to new ideas and a tax environment that’s beneficial to you.

Arizona does not require a state-level business license or require the payment of an annual report fee. This reduces friction with ongoing costs and paperwork, making your LLC simpler to maintain from any corner of the globe.

Arizona’s Business-Friendly Climate

Arizona’s business tax climate ranks consistently among the nation’s best, allowing you to retain more of your profit. The price to form your LLC is low—just $50 for standard processing, or $85 if you’d like it expedited.

The state’s rich and diverse workforce ensures you’ll have the skilled talent you need, whether in tech, logistics, or any other emerging field. Starting up here is incredibly easy, with the quickest approval times for an LLC.

You’ll encounter much less red tape than in other locales, with no annual reports or fees to hassle over. The only unique step is publishing a notice in a local paper within 60 days—a simple process, but worth knowing.

Key Benefits of Arizona LLCs

Without an Arizona LLC, your personal assets are at stake if your business gets into hot water. The state allows you to structure your business as you see fit—maintaining a single manager or having all members manage the business.

Tax-wise, Arizona’s setup can provide you with greater flexibility and less hassle. Ownership and management are streamlined, and you’ll want to appoint a Statutory Agent, which further adds a layer of trust while keeping everything above board and official.

My Take: Is Arizona Right?

Make sure Arizona is aligned with your business objectives and future aspirations. The market out here continues to expand, creating even more opportunities for your new LLC to flourish.

Quality of Life Having a home and business base in Arizona offers an excellent quality of work and life balance.

Arizona LLC Formation Cost Breakdown

When forming an Arizona limited liability company, you’ll need to address a few initial expenses, including the Arizona LLC costs and filing fees. Understanding these early on allows you to develop a realistic, concrete budget from the outset.

1. State Filing: Articles of Organization

Filing your Articles of Organization with the Arizona Corporation Commission is step one. That fee is the standard $50, $85 if you want expedited processing. This form formally establishes your new business with the state of Arizona.

You complete the form, pay the state fee, and submit it electronically or through the mail. It’s essentially the legal foundation for your new LLC.

2. Statutory Agent: Your Arizona Anchor

Every Arizona LLC is required to have a statutory agent. This individual or service accepts legal documents on behalf of your company. You can be your own agent at no cost, or hire a service.

While registered agent services such as Northwest Registered Agent costs about $125 annually, their benefits of privacy and reliability are worth it.

3. Newspaper Publication: County Rules

Arizona has a somewhat unique requirement that new Arizona LLCs must publish a notice of formation in a local newspaper for three consecutive weeks. Costs vary wildly—some counties will charge as low as $60 while others will cost you more than $300.

This step is not required in the two largest counties, Maricopa and Pima. As we mentioned above, rules for LLC formation vary widely by state.

4. LLC Name Reservation (Optional Fee)

If you would like to reserve your Arizona LLC name in advance, the name reservation fee is $10 for mail or $45 online. This step isn’t necessary but is a good way to ensure no one else claims your business identity before you do.

5. Operating Agreement: Essential, Often Free

An operating agreement outlines the rules that govern your LLC. Fortunately, many free templates are available online.

While bespoke legal assistance can run thousands of dollars, most single-member LLCs utilize free templates.

6. Getting Your EIN: No Cost

Apply for an Employer Identification Number (EIN) through the IRS website for free. It’s required for federal tax purposes and for hiring employees.

The best part is that the process is super fast—as easy as completing the online form.

Other Potential Arizona LLC Expenses

Aside from the annual filing fee, there are other potential Arizona LLC expenses you’ll need to consider as your business operates. Understanding these allows you to better prepare your budget, and account for expenses that may arise.

These expenses include the taxes and permits and additional documentation. Usually, these are not just one-time charges either. They tend to pop up every year or when you least expect it and need to make changes to your records.

Transaction Privilege Tax (TPT)

Arizona requires most businesses to remit a Transaction Privilege Tax (TPT). This is different from a sales tax. It is a tax on your privilege to conduct business within the state.

To start, get a TPT license from the Arizona Department of Revenue. After that, get the appropriate license from every city you operate in. It’s a little more complicated than that, though—the rate varies depending on what you sell and your physical location.

For instance, brick-and-mortar retail stores, restaurants and delivery companies, and online vendors each face their own separate rates. For example, if you sell tangible goods in Phoenix you would be required to remit a different TPT than if you are operating a business in Flagstaff.

Business Licenses and Permits

Almost every city and county in Arizona requires you to obtain business licenses or special permits at the local level. These range from $10 to several hundred dollars, depending on your business activities.

For instance, if you want to sell food items, you might need a health permit, or to open a retail store, you’ll need a zoning permit. Failure to adhere to these guidelines may result in costly penalties — or worse, shut down your business.

Federal and State Tax Duties

You will need to file federal taxes with the IRS. Arizona has its own state tax obligations, too. Unfiled tax returns can result in penalties, audits, or additional tax forms.

Keep yourself organized with a professional accountant or high quality tax software. Make sure to set reminders for deadlines and maintain thorough records.

Good News: No Annual Report Fee

Good News—Arizona Has No Annual Report Fee for LLCs. This will save you money every year. In many other states, these fees reach as much as $300.

Arizona’s new annual compliance rule takes a lot of the guesswork out of keeping your LLC in good standing.

Forming Your LLC: DIY or Service?

When forming an Arizona LLC, whether independently or via an online formation service, you face a crucial decision from the outset. This choice will influence not only the arizona llc costs but also the speed of your llc filing and the overall ease of the process, affecting your peace of mind.

The Do-It-Yourself Path

If you choose to go the self-filing route, the first thing you’ll need to do is ensure that your desired business name is available. After that, you simply prepare and file Articles of Organization with the Arizona Corporation Commission. The filing fee is $50 for standard processing (or $85 if you request expedited processing).

Some counties require you to publish a notice of LLC formation, with costs from $30 up to $300, though others are exempt. Draft an operating agreement. Doing so can go a long way in preventing future conflicts. While not legally required, it’s highly advisable even for single-member LLCs.

Next, you obtain an EIN (Employer Identification Number) from the IRS and any local business permits. The biggest attraction is cost savings—doing it yourself means you only pay state fees and publication, not any service fees. However, errors in paperwork or missed deadlines can delay your progress or end up costing you more in the long run.

Using a Formation Service (My Pick: Northwest Registered Agent)

Northwest Registered Agent simplifies the process by filing everything and drafting your LLC’s operating agreement. Plus, they serve as your registered agent for only about $125 per year! You spend more money initially—typically $100 to $500 all-in—but you receive assurance from experts and reminders about what you need to do annually.

If you live outside of Arizona, or if you simply prefer letting someone else handle the details to keep your LLC compliant, these services are helpful. In addition, they expedite processing and decrease errors.

When to Hire an Attorney

Some cases need a lawyer, like if you have many members, plan complex deals, or want special terms in your agreement. A local attorney may be able to better navigate your local rules and federal guidelines, draft customized articles and operating agreements, and address your specific concerns.

Choose an attorney that has experience with LLCs and has transparent fee structures.

Quick Steps: Form Arizona LLC

Forming your Arizona LLC may seem straightforward on the surface, but understanding the Arizona LLC costs and fees involved is crucial. There’s a lot of nuance in each step’s process that you’ll need to address. Here’s a step-by-step list you can follow to set up your Arizona LLC with ease.

• Choose and check your business name
• Appoint a Statutory Agent
• Step Three – File Articles of Organization with the AZCC
• Meet the Publication Mandate
• Secure your Federal EIN
• Apply for a Transaction Privilege Tax (TPT) license

Name Your Arizona Business

Your name should be unique enough to attract attention, but compliant with Arizona’s statutory naming requirements. Your name needs to be original—no one else in Arizona can use your exact business name.

Use the AZCC online search to see if your name is available. Consider making your name short and memorable, easy to spell and pronounce. For instance, “Mesa Tech Solutions LLC” is clearer than “MTS Innovations.

Appoint Your Statutory Agent

You will need to appoint a Statutory Agent, known as a Registered Agent, when you file. This individual or entity needs to have a street address in Arizona and be available during normal business hours.

The statutory agent receives service of legal documents on your LLC’s behalf and ensures you maintain good standing. Most international owners simplify this step by employing a registered agent service ($50–$200/year) to handle this for you.

File Organization Articles

File Articles of Organization with the AZCC. The filing fee is $50 (not all forms of payment may be accepted) or $85 (expedited). You will have to include the name of your business, resident agent, and principal address.

Be sure to file quickly to prevent being penalized with delays.

Meet Publication Mandate

Arizona law mandates that new LLCs publish a notice of formation in an approved newspaper for three consecutive weeks. Determine which papers are eligible and maintain documentation.

Failure to publish can jeopardize your LLC’s status.

Secure Your Federal EIN

An EIN allows you to hire employees and open a business bank account. Secure Your Federal EIN Apply online at the IRS website. The process is completely free and takes only a few minutes.

Once you have your EIN, you’re ready to take care of payroll and taxes with ease.

Maintaining Your Arizona LLC Long-Term

Operating an Arizona LLC comes with the requirement of continuing to complete important tasks each year. Best of luck keeping your LLC healthy long-term! This is important, not only in the beginning, but for the life of your business. Arizona has its own set of rules, and they dictate how you handle the nitty-gritty on a daily basis.

Having a clear understanding of what’s required will ensure you don’t incur unnecessary fines and will allow your business to operate more efficiently.

Ongoing Compliance Needs

Arizona stands out from the rest of the states in that you are not required to submit annual or biennial reports. Nonetheless, you still have other legal requirements to meet. All Arizona LLCs are required to maintain a physical street address in the state—no P.O. Boxes permitted.

Additionally, you’ll require a registered agent who is an individual of at least 18 years of age and an Arizona resident. This individual needs to be available during regular business hours, able to accept service of process. If your LLC operates under a trade name, you file to renew it every five years for $10.

Fees for statutory agents range from $100-300 annually. If your LLC is a multi-member LLC, then you’ll need to file Arizona Form 165. Make sure each member gets a copy of a K-1. Your business name always needs to remain distinct, so monitor it regularly.

Now more than ever, good record keeping is essential. Store contracts, receipts, and tax documents securely and consistently. Maintain your Arizona LLC. Review your licenses and permits regularly to ensure you’re in compliance.

For instance, look up your city regulations annually because business regulations are sometimes subject to change. If your county demands it, then have a notice of your LLC printed in a local newspaper for three consecutive weeks.

Budgeting for Future Changes

Save money in advance for future expenses such as Arizona LLC costs, including license renewals or additional fees. When your team or services expand, revise your budget accordingly. If you intend on changing your business structure, consider legal and LLC filing fees.

Smart Financial Planning Tips

Create a dedicated bank account for your business. Avoid commingling personal and business finances. Even basic tools such as online bookkeeping apps can help them easily keep tabs on spending and income.

This can help ensure you’re prepared come tax time and in the event of an audit.

Conclusion

By starting your LLC in Arizona, you’ll know exactly what to expect with no surprise fees and a predictable process with easy-to-follow steps. You will be paying state fees and you will likely want additional resources, such as a registered agent or online service. Arizona makes it simple—no annual LLC tax, no surprise costs. You’ll save money in the long run compared to other states too. You create your LLC however you want it, whether you do it yourself or have someone help you. That’s why people from all 50 states, the world, and beyond choose Arizona for the simple regulations and inexpensive costs. You receive assurance, less risk, and solid legal protection. If you want to watch your new business flourish, review the regulations, tally your expenses, and choose the option that works for you. Looking to start your first business? Create your LLC today with the right plan.

Frequently Asked Questions

How much does it cost to start an LLC in Arizona?

The state filing fee to start an Arizona LLC is currently 50 USD, a one-time payment made to the Arizona Corporation Commission as part of the LLC formation process.

Are there any annual fees for an Arizona LLC?

No, there are no annual fees for an Arizona LLC, nor does Arizona require an annual report, which helps reduce overall Arizona LLC costs by at least $50 per year compared to most other states.

Do I need a registered agent for my Arizona LLC?

Do I need a registered agent for my Arizona LLC? You can either serve as your own agent or hire an Arizona registered agent to assist with compliance.

How long does it take to form an LLC in Arizona?

Typically, online filings for an Arizona LLC registration are processed in 14–16 business days. If you require expedited processing, you can pay an additional filing fee to process your application more quickly.

What are the extra costs besides the filing fee?

Other costs may include hiring an Arizona statutory agent, publishing a notice in a newspaper (if required), and legal or business consulting fees.

Is newspaper publication required for Arizona LLCs?

Most Arizona LLCs must publish a Notice of LLC Formation to meet the Arizona LLC publication requirements in an approved newspaper for three consecutive weeks, unless located in Maricopa or Pima County.

Can I form an Arizona LLC myself?

We highly recommend using a professional LLC formation service, as the steps to starting an Arizona LLC can be complicated. Most opt for these services for convenience, savings of time, and a higher degree of accuracy.