Starting a Business in Arizona: 12-Step Guide to LLCs, Corporations, and DBAs

Arizona Business Facts and Environment

Arizona Business Facts

Originally a frontier state established on mining and agriculture, the Grand Canyon State of Arizona is now home to several of the fastest-growing cities in the nation and a strong economy that continues to gain momentum in the wake of the American recession. The sprawling capital of Phoenix offers a year-round warm climate and affordable housing in comparison to the nearby west coast.  

Major Companies in Arizona

Arizona serves as headquarters to many major companies including GoDaddy, PetsMart and Republic Services.

Arizona Startup Environment

Arizona provides a business-friendly environment with lower costs in relation to neighboring states. The state also provides tax credits for investing in Arizona small businesses through its Angel Investment Program.

Steps on How to Start a Business in Arizona

Before starting a business in Arizona, you will need to complete several important steps.

Starting a Business in Arizona

Step 1: Decide on a Business Structure

There are 3 basic options: a DBA, a Corporation or an LLC. Click here to learn more about business entities.

• A DBA or “Doing Business As” (also known as a “Fictitious Business Name” or FBN) is not really a separate structure, but just a different name that an individual or partners use as their business name.
• A Corporation is a separate entity (provides liability protection to the owners) that has a structure that includes shareholders, directors and officers. More complex than a DBA but the entity of choice for large companies and startups that intend to raise funding. Some professions are required to choose what is known as a “Professional Corporation” or PC (doctors, lawyers, architects, etc.).
• An LLC or “Limited Liability Company” is a newer type of business that is both a separate entity but provides very easy management (doesn’t require directors or officers) and taxation. Has largely replaced the DBA and Corporation in popularity recently as it provides liability protection but with much less complexity (and taxation) than a Corporation.

Step 2: Pick a Business Name

Choosing a business name is easier said than done – many legal and business problems can arise from picking the wrong name (you can always change it later but the less times you have to do that the better). In Step 3 we’ll show you how to search for the name in Arizona, but we highly recommend you do the following before searching Arizona state databases:

• Make sure you’ve covered the basics: unique, easy to understand/pronounce (practice saying it out loud: “Thanks for calling XYZ”) and can survive over time (“DVD World” is not timely). Here are some of our tips on business identity including logo and trademarks.
• Search the web for your proposed name. Search Google, Bing and DuckDuckGo as a “first sweep” for any potential conflicts, especially in your state or local jurisdiction. NOTE: If you intend to operate nationally or even internationally it will be even more important that your name be unique. This should cover many cases where a company name is being used but not officially trademarked (see next tip).
• Do a trademark search with the US Patent and Trademark Office (USPTO). This will be a very good indicator if you’re name will have any conflicts. There’s an art to trademark searches (trademark specialists will charge you handsomely to do a thorough search) but in our experience if you can use Google at a fairly advanced level you can reasonably clear a name yourself.

TIP: search misspellings, plurals, variations of spelling, sound-alikes and other versions of your chosen name to be sure it’s not already registered.

• Make sure you’ve covered the basics: unique, easy to understand/pronounce (practice saying it out loud: “Thanks for calling XYZ”) and can survive over time (“DVD World” is not timely). Here are some of our tips on business identity including logo and trademarks.

• Make sure your company name choice is available by searching the Arizona Corporation Commission. Note: Make sure to search variations of spelling, plurals and misspellings as the state may reject a name that is too similar (then you have to start all over again, wasting valuable time).

Restrictions on Arizona Business Name & Business Purpose

Familiarize yourself with the Arizona business naming guidelines. LLC entity names need to contain the words words “Limited Liability Company” or “Limited Company” or the abbreviations LLC, L.C., L.L.C. or LC in uppercase or lowercase letters. An Arizona corporation should contain the word “association”, “bank”, company”, “corporation”, “limited”, “incorporated or an abbreviation of one of these words.

Step 3: Register the Business

Each state has its own requirements for registering a business. Now that you’ve chosen a business structure and picked your business name, here are the requirements to register your business in Arizona.

How to form an LLC in Arizona

• File the “Articles of Organization” with the Arizona Corporation Commission.
• Once the articles are filed and approved you will then need to properly organize the LLC (this also applies to “1-person LLC’s”) by holding an “Organizational Meeting” which takes contributions from the members, issues Member Certificates, adopts the company Operating Agreement and more.

How to Incorporate in Arizona

• File the “Articles of Incorporation” with the Arizona Corporation Commission.
• Hold an Organizational Meeting to properly organize the corporation, take contributions from the shareholders, elect directors and officers, issue stock, adopt the Corporate Bylaws and more.
• Optional: Corporations can elect S-Corporation status with the IRS by filing IRS Form 2553. Click here to learn more about S-Corporations.

Considerations when incorporating or forming an LLC in Arizona

• The Arizona Corporation Commission can take from 5-6 weeks to process the paperwork. Rush filing service will take about 2-3 weeks.
• Tip: Check our order form to see how long Arizona is currently taking to process regular and expedited orders.
• A Registered Agent is required for every Arizona Corporation and LLC. Many people list their home or business address on the Articles of Organization or Incorporation. This can cause issues because it becomes public record (you’ll get lots of junk mail). A professional Registered Agent will provide their address and forward any important documents to you, this is also convenient if you have to move (you don’t have to file forms or pay fees, just update your address with your agent).

How to File a DBA in Arizona

• To file a DBA in Arizona you will need to visit the Arizona Secretary of State online application for a trade name. Processing time can take up to 2-3 weeks.
• Once your trade name application has been accepted, you will receive an email asking for payment. Upon completion of your payment, you will receive your DBA certificate via email.
• In Arizona, trade names cannot contain a corporate ending such as “Corporation” or LLC.

Ready to Start Now? Let Us Do The Work

Sure, you could do all the steps above or you could spend 5-10 minutes on our order form and let us take care of it while you work on more important things.

• Learn more about our MyCompanyWorks’ business filing services
• Read our verified reviews and 100% Satisfaction Guarantee
• Contact our friendly support team if you have any questions

Step 4: Obtain Your Federal Employer Identification Number

Your EIN is like your Social Security Number for your company. It’s required for Corporations and LLC’s and optional for DBA’s (if you don’t have any employees, then it’s required). However, if you are a DBA and don’t obtain an EIN you will be forced to use your Social Security Number on many documents so it’s typically recommended you obtain the EIN to prevent identity theft.

To obtain an EIN you can apply online with the IRS or via IRS Form SS-4.

TIP: We will obtain your EIN for you if you we form your company.

Step 5: Open Company Bank and Credit Accounts

To keep business and personal expenses separate, you should open a separate account for your business. In addition, getting business credit cards is how you begin to build a company credit profile (corporation or LLC required) and can later qualify for larger loans and lines of credit. To open the account simply call your chosen bank and inquire on the steps to open a business bank account. Typically you’ll need a) your filed paperwork, b) your EIN and c) a company resolution authorizing your company to open the account (signed by the owners, members, officers or directors, etc.).

Top Business Banks in Arizona

• JP Morgan Chase & Co.
• Wells Fargo & Co.
• Bank of America
• Alliance Bank of Arizona
• BBVA Compass

Click here to view a list of our recommended banks in our Vendor Network.

TIP: Our business formation service includes a free banking resolution for your use.

Step 6: Set-up An Accounting System

Setup your Accounting and Record-keeping system and learn about the taxes your new company is responsible for paying.

Company documents generally are required to be kept for 3 years, including: a list of all owners and addresses, copies of all formation documents, financial statements, annual reports, amendments or changes to the company. All Tax and Corporate Filings should be kept for at least 3 years. View our “Accounting & Financial Management” section for help with setting up an accounting system and purchasing accounting software.

Review our list of Accountants, Accounting Software and Bookkeepers in our Vendor Network.

Step 7: Obtain Licenses and Permits

Now that you’ve registered your business name you need to obtain a business license for your company – this authorizes your company to do business in your city or county. Typically this also involves registering for state taxes and permits (the city may require them as part of the business licensing process).

TIP: We can help you identify the necessary forms to obtain your business license.

Step 8: Hire Employees (if applicable)

If you intend to hire yourself or others as a full or part-time employee of your company, then you may have to register with the appropriate State Agencies or obtain Workers Compensation Insurance or Unemployment Insurance (or both). View our “Employees & Payroll” section for help with hiring employees and processing payroll.

Review our list of recommended Payroll Providers in our Vendor Network.

Step 9: Obtain Business Insurance

There are many types of insurance for businesses but they are usually packaged as “General Business Insurance” or a “Business Owner’s Policy”. This can cover everything from product liability to company vehicles. A decent policy can run as little as $300/year and offers a great extra level of protection.

Click here to view our list of insurance providers in our Vendor Network.

Step 10: Systemize and Organize

Prepare the business as if someone needed to take it over and run it for you. This means have a method to process orders, pay bills, pay employees, pay taxes, maintain your permits, etc. Basically, try to make the operational aspect of the business as automated and efficient as possible so you can concentrate on growing your business. View our “Manage Your Company” section for help with systemizing and automating your business.

Step 11: Branding and Marketing

Now that you’ve set-up the company for success, you need to get the word out. Create a marketing plan for your products and services that targets your ideal customer. View our “Marketing & Sales” section for help for more information.

Step 12: Annual and Ongoing Requirements

DBA: Your Arizona trade name should be valid for 5 years (unless you change the company name or other information). Prior to expiration, you have up to six months to renew your trade name with the Arizona Secretary of State.

LLC: Arizona LLCs are unique from most other states and are not required to file an annual report.

Corporation: An officer of your corporation must file an annual report every year by the anniversary of the corporation’s formation. The cost of filing this report online is $80.

Ready to Start a Business in Arizona?

Our Arizona filing services will help you get started as quickly as possible.

Click here to view our MyCompanyWorks Premium™ service which can automate most or your ongoing compliance tasks.

Important Arizona Contacts

Arizona Corporation Commission (for Corporation and LLC filings)
1200 W. Washington Street
Phoenix, AZ 85007
602-542-3026

Arizona Secretary of State (for DBA/trade name filings)
1700 W. Washington Street Fl. 7
Phoenix, AZ 85007
602-542-4285

Arizona Taxation Department

Arizona Department of Revenue

Arizona Labor Department

Industrial Commission of Arizona – Labor

Arizona Startup Resources

1. Small Business Administration (SBA) Arizona District Offices

• Arizona District Office

2. SCORE Arizona

• SCORE Southern Arizona has 45 mentors to assist those thinking of starting a business or those already in business who need help in growing their business.
• Northern Arizona SCORE has assisted more than 6,000 small business and non-profit clients through free confidential face-to-face counseling and low cost workshops.

3. Arizona Legal Statutes

• Arizona Corporations Code – note this is the broad code that includes various other topics including business corporation.
• Arizona Limited Liability Company Act – the specific act that applies to Arizona LLCs.
• Arizona State Legislature Professions and Occupations – this includes regulations on Arizona’s professions and businesses

4. Arizona Chambers of Commerce

• Arizona Chamber of Commerce and Industry
• Greater Flagstaff Chamber of Commerce
• Greater Phoenix Chamber of Commerce
• Tucson Metro Chamber

5. Arizona Commerce Authority (ACA)

• The Arizona Commerce Authority (ACA) is the leading economic development organization in Arizona with a mission to grow and strengthen Arizona’s economy.

6. Arizona Angel Investors

• List of Angel Investors in Arizona

7. Arizona Business News

• Phoenix Business Journal
• Tucson Business News

8. Arizona OEO

• The Office of Economic Opportunity consolidates and improves analytic capacity for Arizona with the objective of identifying the economic advantages and disadvantages of the state.

9. Arizona Regional Economic Development Foundation (AREDF)

• The Arizona Regional Economic Development Foundation (AREDF) was incorporated in 1985 with the mission of creating a thriving, sustainable economy. The organization has been responsible for the recruitment and retention of large companies such as Northrop Grumman and Teleperformance – directly creating hundreds of jobs. They are responsible for the successful operation of two business development co-space buildings (the Business Complex & Innovation Center) that house entrepreneurs in the startup to development stage of business.

10. Arizona Green Business

• Local First Arizona promotes, supports, and celebrates a sustainable Arizona economy by raising awareness among citizens about social equity, local business ownership, environmental kinship, cultural diversity, and collaboration.