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How Much Does an LLC Cost in Arizona - Fees & Taxes in AZ

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Last updated February 17, 2023

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By deciding to launch a limited liability company, you’ve already made the right choice of a legal structure for your venture. Once you know how to start an LLC in Arizona, your next point of interest will be the costs it entails.

How much does an LLC cost in Arizona? What is the cheapest way to start an LLC in Arizona? What are the upcoming formation expenses and regular payments to cover? We will answer all those and other questions about Arizona LLC costs below.

How Much Does an LLC Cost in Arizona?

Liability protections, flexible taxes, simple management, and easy formation process make limited liability companies widely popular among modern entrepreneurs.

You can complete the entity registration on your own, hire an attorney for this purpose, or engage a professional service to help.

Whatever the formation method, LLC registration is not free of charge. You’ll have a few payments to make that cover:

Compulsory charges and state fees depending on the type of LLC you set up, local statutory requirements, and the activities your business is built around;
Optional payments defined by some added services you might need to maintain your venture, fulfill a specific requirement, or match certain legal conditions.

So, let’s take a closer look at your LLC cost Arizona splitting them into obligatory and added ones.

Cost to Set up an LLC in Arizona: Compulsory Payments

Limited liability companies are state-specific entities, and all states have different state fees and regulatory requirements that impact the final cost.

Hence, final Arizona LLC prices differ by state. Thus, the price of your LLC in Arizona will be made up of a number of elements outlined further on.

LLC Fees in Arizona: Filing Fee: $50

Technically, company registration is about filing formation documents with the state office. While submitting your Arizona Articles of Organization to the State Corporation Commission you’ll have to pay a compulsory filing fee.

Most often than not, the rate will depend upon the filing speed you choose. The cost of online or mail filing in Arizona is $50 making it one of the most affordable US states to start a business.

A $50 rate covers the standard processing time which is about 14 business days. Luckily, the state of Arizona offers expedited processing at a state level. And you can cut down the turnaround time to 7 business days by paying an $85 expedited filing fee.

Publication Fee in Arizona: $30 - $300

Arizona is one of the states that have a publication requirement and call for LLCs to place a Notice of Formation. That notice should:

Appear in 3 publications in a row;
Be published in an approved local newspaper;
Be placed within 60 days after the LLC registration is approved.

A publication fee will fall anywhere between $30 to $300 depending on the county of registration, with Maricopa and Pima counties having no publication requirements.

Statutory Agent Fee in Arizona: $0 - $125

A registered, resident or statutory agent as it’s called in Arizona is a must-have element in an LLC structure. Yet, whether you’ll have to pay for this or not depends on who will fulfill this function for you.

If you choose to be your own agent or appoint someone who agrees to perform this job for free, a statutory agent won’t add to the cost of your LLC in Arizona;
Should you decide to hire an attorney, accountant, business consultant, tax advisor, or a professional agent company, get ready to pay for the service.

By hiring a third party, you get the peace of mind that the agent’s work is done and you have more time for your other business affairs.

If you do want to delegate the agent’s role, a specialized agent service is by far your best option. You’ll leave the job to experts and won’t hit your budget too much.

The agent service average price is about $100 - $150 a year, with 15-20% discounts on bulk orders covering multi-state or multi-year subscriptions.

Arizona LLC Fee: Annual Report Fee and Franchise Tax: $0

Arizona is a favorable area for smaller business owners, private entrepreneurs, and startuppers on a budget who keep a close eye on their ongoing and regular expenses.

Unlike many other US states, Arizona has no annual report in place. Likewise, there is no franchise or privilege tax for LLCs. It means you don’t have to pay any annual fees to the state for running a limited liability company within the jurisdiction.

Foreign LLC Price in Arizona: $150

Running a business in one state, at some point, you might want to expand your activity to Arizona. If this is the case, to legalize your already registered company in this state, you should file for a foreign LLC registration.

Visit the AZ Corporation Commission website and submit Form L025 online. As you fill in the application, you’ll be required to pay a $150 foreign LLC filing fee.

Professional LLC Cost in Arizona: $50 + Licensing Fees

Professional LLCs are set up to provide some sort of services by licensed professionals such as doctors, lawyers, architects, engineers, etc.

A professional LLC filing fee in Arizona is $50 for standard processing time and $85 for expedited filing. Add to this the cost of a professional license you should have in place to start this type of entity, which might be around a few hundred USD.

Business License Cost in Arizona: Price Varies by Locality

Unlike most other US states, Arizona has no general business license requirements for LLCs at a state level. Instead, though, cities, counties, and municipalities have their own licensing requirements. Hence, licensing costs are specific to the locality.

Thus, depending on your business type, location, and the type of license or permit you need, the licensing cost starts at $10 and can jump as high as $360 and more in some cities.

You can do the Arizona business license search to find out the type of licenses required for your business and double-check with the Arizona Commerce Authority and your local clerk.

Arizona LLC Tax Rates

Unless you choose a corporate tax status for your company, you won’t have to pay a state income tax. Likewise, Arizona LLCs are free from the franchise tax.

Yet, if an LLC member’s personal profit crosses a $75,000 line, such a member is required to settle an estimated tax payment to match state income charges. You’ll incur 90% of the tax charged for the ongoing year or 100% for the previous year.

Other common levies applied to this type of entity in the state include:

A corporate income tax for LLCs levied as corporations is 6.98%;
Company owners and managers are exposed to self-employment taxes at a 15.3% rate;
The sales and use tax rate in Arizona is 5.6%;
Companies using the hired workforce should settle payroll taxes that vary from 2.9% to 8% depending on the level of salary and type of work.

Other Arizona LLC Costs

Above the costs we’ve already outlined, there might be added expenses if you need some optional services for your newly formed entity in Arizona.

Arizona LLC Name Reservation: $10 or $45

Limited liability companies are not automatically named after their owners, and each state has its own naming rules. A rule of thumb is a distinguishable name not used by any other registered entity in Arizona.

Once you’ve hit the spot with a unique business name you like but you are not ready to file yet, you can put your desired name version on hold in Arizona for a period of up to 4 calendar months.

Just fill in an Application for Name Reservation and pay $45 for online order and only $10 for a mailed order.

DBA Registration in Arizona: $10

The state law allows operating your business under a name different from the legal or registered moniker. An assumed or DBA (doing business as) name is used for marketing purposes and ensures quite a number of business development opportunities.

DBAs also require state filing. You should register the Trade Name Application with the AZ Secretary of State and pay a symbolic $10 fee per DBA (you can have as many of them as you need).

Arizona Certificate of Good Standing: $10

Should you need to confirm your company’s legitimacy and compliance, you can ask for a Certificate of Good Standing issued by the AZ Corporation Commission.

A regular issue fee is $10 and if you need it urgently, you can order expedite processing at $45.

LLC Document Copies: $10 or $40

In Arizona, you can order from the AZ Corporation Commission two types of your LLC document copies:

Uncertified copies at $10 per copy plus $0.50 per document page;
Certified copies at $40 per copy plus $0.50 per document page.

Trademark Registration in Arizona: $15

Should you decide to ensure trademark protection for your LLC name or other essential company attributes in Arizona, you can register a trademark with the Arizona Secretary of state.

A regular registration fee is $15 per application and expedited processing costs $25 more.

Arizona Articles of Amendment: $25

Any changes in registered LLC data such as your company name, address, or agent change require filing amendments with the state to make those changes eligible.

The Articles of Amendment registration in Arizona costs $25 or $60 if you want to complete the procedure in a faster manner.

Arizona LLC Reinstatement Fee: $100

To restore your company’s legitimacy and legal status after administrative dissolution that happened due to some compliance issues, you can file an Application for Reinstatement with the AZ Corporation Commission.

The standard application costs $100. And if you want to speed up the process, you can pay $135 and get things done faster.

Arizona Articles of Termination: $35

If you don’t need your company anymore, you should terminate its legal existence or dissolve a legal entity.

The Articles of Termination are to be filed with the AZ Corporation Commission. And the processing fee is $35 or $70 for speedy filing.

FAQ

Is forming an LLC in Arizona worth it?

If you seek more legal independence and flexibility for your business and better legal protection for yourself as an enterprise owner, a limited liability company is a right choice to go.

While registering an LLC is not free of charge, the cost to start it in Arizona is overall lower than that in other states and is easy on the pocket of any type of entrepreneur and startupper.

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

Regular turnaround time is about 14-16 business days. Yet, expedited processing is available, and you can get your LLC registration approved within 7 business days, the same day, or even in a few hours.

Is a business license required for an LLC in Arizona?

Arizona has no general business license requirements at a state level. Yet, more likely than not, you’ll need a business license at a local level. So, check with your city or county clerk accordingly.

Should an LLC in Arizona pay an income tax?

Taxed as a pass-through entity by default, an Arizona LLC is free from paying a corporate income tax to the state. Meanwhile, company members are still exposed to income taxes at a personal level.

Does an Arizona LLC require renewal on a yearly basis?

Arizona has no annual report requirements for LLCs, so you won’t have to bother to file any statements or pay any fees each year.

What is the cheapest way to get an LLC in Arizona?

If you seek to minimize your Arizona LLC costs, handle the registration process on your own. This way, you will only have to cover statutory LLC filing fees Arizona and avoid any added expenses.

Do Arizona LLC businesses get tax refunds?

Taxed as disregarded entities, Arizona LLCs cannot get tax refunds. Yet, if you submit Form 8832 with the IRS to elect a C-Corp status for your LLC, you can expect some tax repayments.

Can I pay myself a salary from my Arizona LLC?

Basically, LLC members are considered self-employed and are distributed a part of the LLC profit pro rata to their equity share. If you elect a corporate tax status for your LLC, then you’ll be able to get employed by your own company and pay yourself wages.

Can I pay for my cell phone from my Arizona LLC?

Only the costs pertinent to business use are deductible. Note, though, that the business-related use should be over 50% of total cell phone costs.

Can I write off my Internet from my Arizona LLC if I work from home?

The IRS allows for Internet cost deduction to the extent you use the Internet for business purposes. And those costs are deductible only if business use prevails.

Can I write off car payments from my Arizona LLC?

Similar to many other types of operational expenses, car costs are deductible pro rata to the scope of business use. You can write off entire costs if you use your vehicle solely for business.

Can I write off fuel receipts from my Arizona LLC taxes?

To deduct your business-related fuel costs, you should account for the miles you drive for work tasks. An easier way would be to withdraw those expenses within general driving costs.