Arizona Business Tax

Arizona business tax includes a wide range of taxes and they are levied on individuals and businesses. The taxes are normally levied on the profits earned by a company but can also be on the sales and purchase of products and services. A business tax is basically collected by the state government as it is a source of income for the state. Whether you register a domestic entity or operate as a foreign company, taxes are an integral part of this state’s annual requirement. Since every business will be levied a different type of tax, you may need an Arizona business tax Calculator to move forward with your overall tax planning including accounting and bookkeeping.

What taxes do businesses pay in Arizona?

Arizona is quite a popular destination for first time business owners and one key factor is its good tax environment. The state has one of the lowest flat tax rates in the USA and thus Arizona business tax climate is quite favorable for both domestic and foreign entities. You can choose to form different types of entities in this state right from a limited-liability Company to a C Corporation, sole proprietorship, general partnership, and an S Corporation. Each type of entity will have a different tax status in this state. Depending on the entity structure and the primary business activity, your company may have to file a single form of state tax or multiple taxes like Arizona LLC taxes including individual and state taxes. Let’s try to understand the different types of taxes applicable to new and existing businesses in this state.

Arizona corporate income tax

There are different categories of income taxes in the state and one of them is the Arizona corporate income tax. It is also known as the corporation tax and is levied on any taxable profits generated from your business. The taxable income may include several items like capital gains, investment profit, and trading profit. This type of Arizona Corporation taxes can be reduced through common tax-deductible expenses like operating expenses and employee salaries or bonuses among others. Currently, the rate of corporate income tax in Arizona is 4.9 percent.

Pass-through entity (PTE) tax

The Pass-through Entity (PTE) tax is considered as an entity-level income tax. This type of tax is applicable to mostly partnerships and subchapter S corporations. Currently, the rate of this Arizona corporate income tax is 2.50 percent of the income attributed to the S Corporation or partnership’s shareholders or resident partners. It is also applicable on any income derived from various sources within Arizona and attributed to nonresident shareholders or partners.

Small business income (SBI) tax

The Arizona Small Business Income Tax (SBI) is a fairly new form of tax that is often considered under Arizona LLC taxes. This allows an individual taxpayer to report his or her small business income on a separate return. There is a flat tax rate of 3 percent. It is important to note that the Arizona SBI tax return has to be filed along with the regular income tax return.

Transaction privilege tax (TPT)

The TPT is one of the most important forms of Arizona business tax. It is commonly referred to as the state sales tax. This type of tax is subjected to an individual or company for the privilege of conducting business in this state. There are various business activities that are subjected to the transaction privilege tax like advertising, telecommunications, residential rental, retail, and restaurants among others. You will need to use an Arizona business tax Calculator as the TPT tax rate varies according to the type of business activity and the county or city your company is operating from.

Local Arizona Taxes

There is the Arizona business tax also known as state tax and then there is the local tax. The most common form of local tax is the use tax. The use tax is often seen as a complement to the Transaction privilege tax (TPT). It is also filed using the TPT return. There are certain conditions in which this type of Arizona LLC taxes will be applicable. They are –

• If you make any out of state purchases towards operating your company and have not paid any sales tax on it or if the sales tax is less than that of Arizona use tax rate, then you will be required to file use tax.
• If you have purchased goods using a resale certificate, and if such goods have been stored, used, or consumed within the state contrary to the actual purpose stated in the certificate then will be required to pay use tax.

Arizona State Employer Taxes

State employer taxes are also known as Arizona Withholding Tax. This is additional to any Arizona corporate income tax and is purely based on the situation where your company has employees. If you have employed the services of people and are paying salary then you will need to withhold Arizona income tax from those employees. This is applicable for services being rendered within Arizona. This type of Arizona Corporation taxes is calculated on the basis of a percentage of your employee’s gross taxable wage. There are certain situations in which the withholding tax is not applicable like if you pay salary or wages to a nonresident employee.

Industry Taxes

When it comes to starting a new business in Arizona, it is important to know that you might be levied taxes if your business is connected to specific industries. These can be in the form of state tax or local taxes. For example – if you are operating from Mesa, AZ and are planning to invest in industrial or commercial property then there will be an assessment ratio for property taxes at the rate of 16.5 percent of the limited property value (LPV). Industries like aviation fuel will attract Arizona business tax. If you are producing aviation fuel or importing it into Arizona then the tax rate will be 5¢ per gallon.

Are you thinking of forming a new business in Arizona?

How Arizona Businesses are Taxed?

Once you form a new business in Arizona, your company will have to be compliant with both federal and state taxes in order to maintain good standing with the state. Your company may be required to file Arizona LLC taxes or some other form of taxes depending on the entity structure. The type of taxes levied will also vary according to the location of your company, the business activity, industry, employment. Let us look at the different types of entities and their tax obligations in this state.

Taxes for an LLC

If you are planning to register an Arizona limited-liability company then for tax purposes, it will be considered a pass-through entity. As a result, instead of filing Arizona corporate income tax, you will be required to file personal income tax at a flat rate of 2.50 percent. In a pass-through entity, the business income will pass through to the owners and other members. Apart from this income tax, there are other forms of Arizona LLC taxes that you may be required to file in this state.

Taxes for a C Corporation

If you are planning to incorporate in Arizona then you will be required to file Arizona corporate income tax. The current tax rate for corporate taxes is 4.9 percent. C Corporations may be required to file some of the following taxes –

• Transaction privilege tax (TPT) – This is a mandatory tax if you are selling a product or promoting a service specifically mentioned by the Arizona Department of Revenue.
• Use tax – This is one of the important Arizona Corporation taxes and is mostly levied for different business activities by specific counties.
• Corporate income tax – If you incorporate in this state then you will be required to file the Arizona corporate income tax.
• Individual Income tax – Shareholders and directors of a corporation will have to file individual income tax returns.
• Withholding Tax – If your company has employees then this tax return has to be filed.
• Other Taxes – Depending on your business activity and industry, you may be required to file certain other taxes. These include severance tax on metalliferous minerals, luxury tax on liquor, and workers’ compensation insurance premium tax among others.

Taxes for S Corporation

If you have started an LLC or a C Corporation and elect S Corporation tax status then one of the benefits is that you will not be subjected to the Arizona corporate income tax. S Corporation is a pass-through entity like an LLC hence each member or owner would be required to file personal income tax. S Corporations in this state may choose to file the Arizona Pass-Through Entity (PTE) income tax. Of course the PTE election needs to be done by the S Corporation prior to the due date or extended due date for filing of the state income tax return. You will be required to file Arizona Form 120S for the PTE election. This is one of the important Arizona Corporation taxes and the rate is a flat 2.50 percent of the income attributed to the S Corporation’s shareholders.

Taxes for a Sole Proprietorship

A sole proprietorship is one of the easiest forms of businesses. Once you form this type of company, you will need to report your profits by filing the individual income tax return. Apart from this, depending on the type of activity, you may be required to file an Arizona business tax in the form of transaction privilege tax, and use tax. You can also choose to file the Small Business Income Tax (SBI) where you have to report your small business income on a different return (Arizona Form 140ES-SBI) at a flat rate of 3.0 percent.

Taxes for Partnerships

If you form a partnership company in Arizona then the applicable taxes would be similar to that of taxes for sole proprietorships, S Corporations, or Arizona LLC taxes. Partners will be required to file individual tax returns based on the income they have earned through the business. Partnerships can also elect to file the Arizona Pass-Through Entity (PTE) income tax. If you are selling specific products or services then you will be required to file sales tax or the transaction privilege tax. You may also be required to file withholding tax.

Ready to Incorporate Your Arizona Company?

Arizona provides just the right business environment, good policies and regulations, and strong infrastructural support to new and existing businesses. You can choose to form different types of entities like Limited Liability Company, partnership firm, sole proprietorship, C Corporation, and S Corporation. Once you have formed or registered your company, you will need to ensure fulfillment of all annual state requirements including filing Arizona business tax. IncParadise can help you by providing information and assistance pertaining to business taxes and annual requirements.

Doing Business As or DBA in Arizona

A “Doing Business As” (DBA) name is also known as a trade name in Arizona. When you start a sole proprietorship or a single member LLC in Arizona, you may be required to list your business name with the state. Once you file a trade name in Arizona, it will be considered as the official legal name of your company. It is important to understand that not all businesses opt for a DBA. Some entities prefer a business name like CampusLogic while others prefer to use their own legal name like Carol Danvers Sports Equipment.

What is DBA in Arizona?

It is essential to understand what a trade name actually is before you can apply for Arizona DBA online. If your company or any company plans to use a name that is different from your legal name then such a company will be considered to be using a DBA or trade name. It is also known as an assumed name or fictitious name. Generally speaking, the name of your company can be any of the ones mentioned below –

• Your name or name of the owner like Maurice Jensen Inc.
• Traditional business name like Axon Technologies
• Trade name or DBA like Natalie’s Pie

When do you need a DBA in Arizona?

If you are planning to start a business and are a newcomer then there are certain aspects of operating a company that you need to be familiar with. One such aspect is providing a name to your company. Small businesses and first time individual owners normally prefer to go with a DBA also known as a trade name. Once you identify a name, filing a DBA in Arizona becomes necessary. But why a DBA? Do you actually need a DBA? These are some of the important questions that may arise in your mind. So, let’s look at some of the common reasons for choosing an Arizona trade name –

• Type of Structure – The structure of your company may be a decisive factor when it comes to opting for and filing an Arizona DBA online application. The most common and easy to form businesses are sole proprietorships and partnerships. You may use your full legal name or a trade name if you are opting for either entity structures. Even a general partnership company can select a DBA name. This is because these types of entities are considered as unincorporated businesses as they are not required to file any business registration paperwork with the state. Even a single-member LLC can choose to use a trade name in Arizona.
• Franchises – A doing business as name can be extremely beneficial if you are planning to operate a franchise business. A franchise owner may not require a DBA. As a franchise owner, you may file a trade name in Arizona to establish your company’s identity as a local or state business.

  Example: You bought a local Dickey’s BBQ restaurant franchise. Franchisees are normally formed as a corporation or ab LLC. Now, you form a franchise under Fastfood Business LLC. You will need to ensure your DBA is “Dickey’s BBQ”. This will help your state (Arizona) to know that you are “doing business as” the franchise you have joined.

• Operate a separate business – Normally, business corporations (S and C corporations), limited liability companies (LLC), and limited partnerships (LP) are technically not required to file a ‘doing business as’ name. However, if the state laws or local laws (city or county) requires these entities to apply for Arizona DBA online then you will need to choose a trade name. This requirement changes if you are planning to operate multiple businesses under the same name. If you were to expand your business area and open a new company then filing a DBA will spare you the hassle of registering or incorporating the new company.

Filing DBA in Arizona for LLC and Corporation

A DBA (doing business as) is known as a trade name in the state of Arizona. Whatever structure of business you choose like an LLC, general partnership, or a sole proprietorship, filing a DBA in Arizona will ensure registration of your company name. If you are wondering how you can look up a DBA in Arizona then there is a specific process to apply for and obtain a trade name certificate. The process as well as the fee may be different from that of the standard business name reservation process and fee.

Do Arizona Trade Name Search

If you want to apply for Arizona DBA online then the most important thing is to ensure it is compliant with Trade name laws of the state as well as other business name related rules and regulations. Once you have carefully thought of a company name, the next step would be to conduct an Arizona trade name search also known as DBA name availability search. This search is facilitated by the website of the AZ Secretary of State as well as the Arizona Corporations Commission website. It is important to note that you can file a DBA only if the search reveals availability of your chosen name. If your company name is not available then you will need to change the name and search again. You can conduct the name search using any of the following criteria’s –

• Trade name or DBA
• Statutory agent name
• Principal name
• Entity ID

Register your Arizona DBA

Once you conduct an Arizona trade name search, you will know if your chosen name is available or not. If your chosen name is available then the next step is to register the assumed name. You will need to submit the Trade Name Registration Application with the office of the Secretary of State pursuant to AZ Rev Stat § 44-1460 (2023). There is a filing fee of $10. If you want to expedite the process then there is an additional fee of $25.

Do you need help with an Arizona DBA?

Managing Arizona DBA

Once you file an Arizona DBA online application, the process will share certain information regarding your company with the state. The people of the state will know the name under which your business operates legally. The state of Arizona has rules and regulations pertaining to various aspects of a DBA or assumed name. These laws state the requirements for renewal, changing, or canceling of the trade name in the jurisdiction the business is operating from. Let’s look at the various processes applicable for managing an Arizona DBA.

How to renew Arizona DBA?

In most states, once you register a DBA then it will need to be renewed. Different states in the nation have different renewal dates or duration of expiry of an assumed name. Once you file a trade name in Arizona, it will expire after a period of 5 years from the date of registration. You will need to renew it for another five-year period and this is governed by the 2023 Arizona Revised Statutes, Title 44 – Trade and Commerce, § 44-1460.02. The Trade Name Renewal application has to be filed online with the office of the Secretary of State. There is a renewal fee of $10.

How to change Arizona DBA?

Once you have filed an Arizona DBA online application, the only way to change your business name is by canceling the existing name and filing an application for a new trade name. The process is easier for standard business names as all you have to do is submit Articles of Amendment.

How to cancel Arizona DBA?

You can cancel a trade name only after filing a DBA in Arizona. Once the name has been registered, you can file the online Trade Name Cancellation application with the office of the Secretary of State pursuant to AZ Rev Stat § 44-1460.07 (2023). There is no fee for cancellation.

Need Any Assistance in Filing Arizona DBA?

The process to file a trade name in Arizona requires you to provide accurate information while being compliant with the federal trademark laws as well as Arizona Revised Statutes. Conducting an Arizona trade name search is also of utmost importance as it will ensure your chosen name is not rejected by the state. IncParadise can assist you with this process. We have expertise and knowledge regarding the Arizona state rules and regulations pertaining to trade names and new businesses.

Sole Proprietorship in Arizona

Arizona is a growing and fast paced economy as is evident from the state’s real gross domestic product (GDP), which was $414.27 billion in 2023. You will be surprised to know that a large contribution to the GDP is from small businesses including sole proprietorships. There are over 650 thousand small businesses in this state evolving and growing in several key industries. One of the top industries that is home to sole proprietorships in Arizona is food and agricultural exports, and the growth of this has exceeded $1.4 billion. The state also provides several advantages if you are planning to start a new business. You can benefit from a strong infrastructure, robust transportation and logistics network, a highly skilled workforce, low cost of living, and technology hubs like Phoenix.

What is a sole proprietorship in Arizona?

If you are wondering how to start a sole proprietorship in Arizona then let us first try and understand the type of entity structure it has. In fact, a sole proprietorship is known to have the simplest structure as there is a single owner. Hence, it is also known as a sole trader. As opposed to corporations and LLC, this type of company requires minimal documentation. This entity is not considered to be a legal entity and hence you are not required to file any formation documents with the state. This makes it easier to start a sole proprietorship in Arizona. A sole tradership business has different taxation rules and you will not be required to file any federal or corporate taxes.

Important features of sole proprietorship in Arizona

A sole proprietorship in Arizona is a preferred entity structure for start-ups and even home-based businesses. There are several features that make this type of an entity so popular amongst first time business owners. Let’s take a look at some of the top features including the various benefits you may derive.

• The foremost feature of a sole proprietorship is that it is a one-man or single-owner organization. This means that decision making lies in the hands of the owner.
• If you search sole proprietorship in Arizona for laws, you will realize that this entity is considered as a natural person and not as a legal entity. The bottom-line is that the business and the owner are the same unlike in corporations.
• A sole proprietorship in Arizona does not have to be registered or incorporated. This makes it the ideal choice for operating a small or medium scale business.
• This type of entity has simple formation requirements. Similarly, closing a sole proprietorship is also very simple. There are hardly any legal processes involved and no requirement of any certificate of cancellation, termination or dissolution.
• As a business owner of a sole trader, you will not be required to share your profits unlike in other forms of entities.
• Sole proprietorship taxes are filed under the owner’s income tax return

Steps to Start Sole Proprietorship in Arizona

If you are wondering how you can start a sole proprietorship in Arizona then the important thing here is to understand the various steps you may need to take to make your business operational. There are some basic areas to focus on initially, like naming your company, getting business licenses for operations, ensuring you have a proper bank account etc. Let’s look at some of these important or core areas that will help you to start a sole proprietorship in Arizona with ease.

1. Prepare a business plan

Having a great business idea is the starting point but moving from here towards actually establishing and conducting a business is the real challenge. This is where a good business plan will come into play. It is also known as a strategic plan and encompasses several facets of running a company. This is the first goal in the how to start a sole proprietorship in Arizona checklist.

• Executive Summary
• Company Description
• Core Concept of your business
• Initial goals
• Long-term objectives
• Product and Services
• Target audience
• Competition and Market analysis
• Marketing Plan and Sales Tactics
• Operating plan
• Financial Plan and Projection

2. Choose an Arizona business name

You can start a sole proprietorship in Arizona only after you have named your company. This stands true for any form of business. The importance of a company name lies in the fact that it will not only communicate with your customer but also enable your business to stand out amidst competition. It is considered as the cornerstone of any brand and hence is integral to your marketing strategy. The business name is often also used for several other purposes like obtaining licenses and permits, registering an office, and applying for a bank account among others. Here are some tips to consider before you can choose and file an Arizona trade name.

• Follow the naming guidelines as provided in the Arizona Revised Statutes
• It is important to ensure your company name is not similar to that of your competitor
• Avoid business names that are hard to spell or pronounce
• Your chosen name should have a high recall value amongst prospective customers
• The name should be relevant to the product or services being offered
• After choosing a name, check for its availability as a domain name for your website
• If you want to keep short names then online business name generators can be quite helpful

3. File a Trade name and incorporation

If you have taken a decision to operate a sole proprietorship in Arizona then a business name is of utmost importance. You can either use your legal name as the business name or file an Arizona trade name also known as DBA (Doing Business As) name. The DBA or trade name will allow you to conduct your business under any name other than your legal name.

Do you want to start a sole proprietorship in Arizona?

4. Get EIN

Arizona is considered to be a community property state and hence even a couple (husband and wife) are allowed to operate a sole proprietorship company. Hence, if you form a sole proprietorship in Arizona, there will be no formal or state filings whatsoever but you may need to apply for an Employer Identification Number (EIN). This is also known as the Tax ID number or the Federal Tax Identification Number (TIN). This number is used for identifying a business entity.

• If you have hired at least one employee
• If you are planning to operate as a corporation
• If you are planning to operate as a partnership
• If your company is required to file a federal Employment tax return
• If your company is required to file excise tax return
• If your company is required to file Alcohol, Tobacco, and Firearms tax return
• You apply for a Keogh plan
• You are involved with entities like estates or trusts or plan administrators

5. Obtain necessary licenses and permits

If you are wondering how to start a sole proprietorship in Arizona and make it operational then it’s important to focus on business licenses. Any new or existing entity in the state including sole proprietorships will need to apply for and obtain relevant operational licenses in this state. It is important to note that if you start a home-based business then your company may be exempt from specific permit requirements. This rule may vary from one county or city to another. Business licensing in the state of Arizona can be categorized as under:

• Arizona transaction privilege tax (TPT)
• Professional or Occupational License
• City or County licenses and permits
• Regulated licenses
• Zoning permits

6. Open a bank account for your Arizona business

Whether you start a small business like a sole proprietorship or form a large corporation, there will be profits and losses. This is one of the primary reasons why your company would need to manage its finances properly. There are times when accepting business payments in personal savings accounts can lead to chaos especially in the tax season. The IRS and finance experts hence recommend that every company should have a business bank account. This will enable you to keep your personal gains separate from business gains. You can open this type of banking account before or after you form a sole proprietorship in Arizona.

7. Report and pay taxes

Once you have formed any business entity in the state of Arizona including a sole proprietorship, you will need to maintain compliance with the state. These are also known as annual maintenance requirements. Although sole proprietorships are not required to file an annual report, you will still have to file taxes. If you search sole proprietorship in Arizona for taxes then the primary would be a personal income tax return.

Ready to Start a Sole Proprietorship Business in Arizona

If you have decided to start a sole proprietorship in Arizona then it’s a good decision. This type of entity is easy to form and uncomplicated in terms of operations. You will not be required to submit any formation documents with the state. However, you will need to maintain annual compliances and your company will need to obtain relevant business licenses and permits. This will help you to enjoy a good standing with the state.

Business License in Arizona

In order to make your business operational in Arizona, there are several requirements that you will need to fulfill. These include registering your company with the state, paying taxes and obtaining an Arizona business license. Identifying the right license according to industries and jurisdictions can be quite tricky as the rules, requirements, and fees vary from city to city or county to county. You might not see a clear way forward. Nevertheless, if you fail to obtain an Arizona business license then that can be a costly affair for your company. Operating without the required license may lead to penalties including fines and lawsuits and in extreme cases, even dissolution of your company.

Who needs an Arizona business license?

Whether you form a sole proprietorship, LLC, corporation or any other form of domestic or foreign entity, Arizona business licenses and permits are mandatory. There are certain processes and steps you must follow to procure these licenses and permits. As a business owner, you will need to conduct a detailed Arizona business license search to identify the licenses required by your company. There are basically three forms of licenses –

• Federal Licenses and Permit
• State Licenses and Permit
• Local Licenses and Permit

What business license do I need in Arizona?

Many states in the USA have a common or general license for all types of entities. A general license is a basic license for operating within the state. The state of Arizona doesn’t have this general license also known as a statewide business license. Instead, you may need to obtain an Arizona business license and permit based on your primary business activity and location of the business. It is also important to note that there are several cities as well as counties where you need to apply for a local license prior to beginning operations. This is especially required when planning to operate within the city or county limits or jurisdiction.

Type of Business Licenses in Arizona

If you are planning to start an LLC or a corporation in Arizona then you would need to apply for different types of licenses or permits. You may be required to obtain an Arizona business license at the state level and the county level. Let’s take a look at the important licenses.

State Transaction Privilege (Sales) Tax (TPT) License

One of the most commonly required licenses in the state is the Transaction Privilege (Sales) Tax (TPT) License. This is a license based purely on business activity. If your company is into specific activities especially those connected to selling a specific product or engaging in a service then you will require this license. The Arizona Department of Revenue is responsible for issuing this license. You can conduct an Arizona business license search with the Arizona Department of Revenue or the Arizona Commerce Authority to identify if your business activity qualifies for this license. Some of the common activities requiring this license include Advertising, Feed at Wholesale, Transient Lodging (hotel/motel), Residential Rental, Restaurants and Bars, and Retail Sales Food for Home Consumption among others.

Business License/Local Licenses/Permits

You have registered a new business in Arizona. Its office is situated in the town of Queen Creek. This is a typical scenario in which a business will need to apply for state licenses as well as local licenses and permits. The local licenses are mandatory in some cities and counties. Hence, it is important to conduct an Arizona business license search to identify the specific permits or licenses required in the county or city or jurisdiction in which you are operating. The licensing regulations, requirements, and fee will vary from one jurisdiction to another.

Regulatory (Professional/Special) Licensing Permits

The third type of Arizona business license is known as the regulatory licenses or permits. This type of license will be required by your company if the primary activity requires supervision or regulation by single or multiple state, municipal, and federal government agencies. Some of the activities are defined under the professions and occupations category of the Colorado Code – Title 12. You may even need to apply for and obtain a special Arizona business license and permit or even certification wherever required. This is apart from the state and local licenses. Your business may require all three forms of license depending on the business activity.

Need any Assistance in Obtaining Your Arizona Business License?

If you are planning to establish an LLC or any new company in the state of Arizona then there are certain compliances to adhere to. These are also considered as state annual maintenance requirements. One such important requirement is obtaining an Arizona business license. This will help your company to become operational in the state. If you operate without the relevant licenses then you will be penalized. The type of Arizona business license and permits will vary according to business activity and location. Hence, it is important to conduct in-depth research of the state laws and local zonal requirements.

Arizona Business Entity Search

It is not far-fetched to say that a company can ride its way to success using a brilliant or creative company name. Yes, a business name plays a crucial role when it comes to attracting customers, creating meaningful vendor relationships, and promoting the various products or services of a company. A strong brand can even help in attracting investors. This is one of the many reasons why it is important to conduct an Arizona business name search. This is a specialized search that will help you to ensure your chosen name can become the company name permanently. Essentially, a business name can vary from something as creative as Adidas to an acronym like IBM (International Business Machines). At the same time, it is vitally important to maintain compliance with the Arizona business name rules.

• It’s important to go with a company name that is easy to spell or pronounce like Levis
• Always try to ensure that your chosen name is easy to remember
• The company name should be in-sync with the products or services being offered like Brad’s Software
• It is also important to follow the Arizona business name rules and state guidelines
• Your business name should be readily distinguishable from any other LLC or Corporation name in the state database
• Try not to keep a name that is similar to your competitor’s name
• Make certain that your company name is web-friendly
• Always conduct an Arizona business name search prior to finalizing the name

What is an Arizona business name search?

Business name search or entity search is a process through which any company can identify whether their chosen name has already been taken by another company or not. This search is recommended only after you have identified the proper business structure. The reason being that if you want to start a limited liability company then your business name will indicate the same. Hence, you will have to conduct an Arizona LLC name search.

Naming your Arizona LLC

If you have decided to form an Arizona limited liability company then there are several processes that you may be required to follow for successfully establishing your business. One of the first steps is naming your LLC. You will not be able to register your company without the business name. If you have thought of a creative business name then it will help influence your clients as well as prospective customers. When choosing a name, you can conduct an Arizona LLC name search for company name ideas and also to check availability of the said name. Let’s look at the two important aspects to consider when it comes to naming your limited liability company.

General LLC naming rules

One of the most important areas to focus on during naming of your limited liability company is LLC rules and guidelines according to state law. The LLC name guidelines are regulated by 2019 Arizona Revised Statutes, Title 29 – Partnership, Chapter 4 Arizona Limited Liability Company Act, Article 1 General Provisions. The general Arizona business name rules for an LLC name are:

• Your chosen name should have words like Limited Liability Company, limited company or abbreviations like LLC or L.L.C. pursuant to AZ Rev Stat § 29-602 (2019)
• Your company name should not contain certain words like association, corporation or incorporated or abbreviations of these words.
• According to the restricted words list, you cannot include words like bank, deposit, credit union, trust or trust company. They cannot be used in combination or separately.
• Ideally, your chosen name should be distinguishable from any other name in the Database. If it is not distinguishable and you want to still use it then you will need to apply to the Arizona Corporation Commission for relevant authorization.

Search LLC name availability on the Arizona Corporation Commission’s website

If you have established an LLC name that is compliant with the Arizona business name rules then the next step is to ensure you are able to reserve this name. In order to reserve or register the name with the state, you will need to first conduct an Arizona LLC name search. There are different options for conducting this search and they are:

• Search by Name
• Search by Entity Number
• Search by Statutory Agent
• Search by Principal Name

Are you planning to form an LLC in Arizona?

Naming your Arizona Corporation

If you are planning to start a domestic corporation in Arizona then the first important step will be to identify or choose a corporate name. The importance of a company name lies in the fact that it helps in creating an emotional connection with partners, vendors, and consumers. The name thus plays a key role in defining the brand and increasing its visibility and recognition. Hence, you need to ensure that the corporate name is compliant with all Arizona business name rules. Once a name has been finalized, an Arizona Corporation name search will help you to ensure availability of such a name for reservation. Let’s look at the important aspects to consider when it comes to naming your business corporation.

General Corporation naming rules

If you are planning to register a domestic or foreign corporation then you will need to reserve a corporate name first. Either way, you will need to conduct an Arizona business entity search before you can reserve or register the name. The state guidelines for naming a corporation is governed by 2019 Arizona Revised Statutes, Title 10 – Corporations and Associations. Some of the important aspects to consider are:

• Your corporate or company can contain the words company, corporation, limited, incorporated or association. It can also contain an abbreviation of any of these words like Inc., Corp, or Ltd pursuant to AZ Rev Stat § 10-401 (2019).
• The name should not contain any language that states or implies that your corporation has been organized for a purpose other than that has been permitted by AZ Rev Stat § 10-301 (2019).
• The Arizona business name rules state that there are certain words that cannot be used in the corporate name. They are also known as restricted words and include bank, deposit, credit union, trust, and trust company.
• Your corporate name also should not contain words or abbreviations like Limited Liability Company, limited company, L.L.C., L.C., or LLC.
• The corporate name chosen by you should be distinguishable from the names of any other company formed or incorporated in this state.

Search Corporation name availability on the Arizona Corporation Commission’s website

Once you have picked out a brand name or company name in compliance with state naming rules and guidelines, the next step is to look for an Arizona business name availability. This is facilitated by the online portal of the Arizona Secretary of State as well as the Arizona Corporation Commission. There are several options available but the one recommended for a corporate name search is “Search by Name”.

Are you thinking of Incorporating in Arizona?

Need any Assistance in an Arizona Business Name Search?

Business name or corporate name is an identity that will create a bridge between the company and your future customers, clients, vendors, and partners. An Arizona business name search is a process that clears the way for you to reserve the chosen company name. This further makes it easier to register your LLC or incorporate your company. Company name reservation also simplifies several other important processes like opening a checking account and issuing of business licenses.

Arizona LLC Annual Filing Requirements

The Arizona LLC annual requirements will be applicable only after you have registered your company. The annual requirements for a limited liability company may be different from that of a corporation or any other business structure. The annual requirements are governed by 2019 Arizona Revised Statutes. The essence of fulfilling the annual requirements lies in the fact that it will ensure your company enjoys a good standing with the state. If you start a limited liability company in this state then the important annual requirements are categorized as under.

No Arizona LLC Annual Report

One of the first annual requirements for an LLC in any state is that of an annual report. Unlike other states, there is no requirement of an Arizona annual report. It simply means that if you form an Arizona limited liability company then you don’t need to file any annual reports with the state.

Arizona LLC Taxes

There are different forms of LLC taxes in Arizona and filing of the same is important towards ensuring annual compliance. The state taxes are governed by the 2019 Arizona Revised Statutes, Title 42 – Taxation. A limited liability company has a tax status of a pass-through entity by default. Hence, the responsibility of filing taxes passes through from the LLC itself to the individual members of the company. Thus, the LLC doesn’t pay income taxes, but their members have to file the individual tax return. The members of an LLC will be taxed at a rate of 15.3 percent. If you have elected S Corporation Status for your LLC then you will be taxed at 4.9 percent.

Arizona Employer Taxes

One of the important Arizona LLC annual requirements is that of filing state employer taxes. Here, the employer is considered to be the company. If your limited liability company has employees then pursuant to the Internal Revenue Code, you will be required to withhold federal income tax from the wages you are paying to your employees. Apart from the federal tax, as an Arizona employer, you will be required to pay the following taxes.

• State Withholding Tax – As an employer, you must withhold Arizona income tax from your employees whose compensation is being given for any and all services provided within Arizona. The state income tax withholding is considered to be a percentage of your employee’s gross taxable wages pursuant to U.S. Code § 3401. In order to file the withholding LLC taxes in Arizona, you will need to register your Employee Identification Number (EIN) with the Arizona Department of Revenue (ADOR). The form used for this registration is known as the Arizona Joint Tax Application (Arizona Form JT-1). You can file this tax monthly, quarterly or annually depending on the amount of Arizona taxes withheld.
• Unemployment insurance (UI) tax – If you have employees in your company then you will be required to file unemployment taxes. This is also known as the state UI tax (SUTA) and is handled by the Arizona Department of Economic Security (DES). You will be able to register for LLC taxes in Arizona by filing an Arizona Joint Tax Application. This tax is normally filed on a quarterly basis.

Arizona Sales Tax (Transaction Privilege Tax)

Most states in the USA have certain common taxes like the sales tax. The sales tax is known as the Transaction Privilege Tax (TPT) in the state of Arizona. This is one of the important Arizona LLC annual requirements. This tax will be applicable on your company for the privilege of doing business in this state. It is important to note that there are certain business activities that will be subjected to the transaction privilege tax.

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Arizona Corporation Annual Filing Requirements

One of the top business structures is the corporation. If you have decided to incorporate in Arizona then there are different state requirements and regulations that you need to adhere to. The Arizona Corporation annual requirements are one of the most essential mandatory state obligations to be fulfilled. This includes knowing when to file the Arizona Corporation annual report. The annual requirements will be applicable for both domestic and foreign corporations. It is governed by the 2019 Arizona Revised Statutes, Title 10 – Corporations and Associations. Let’s look at the various annual requirements in detail.

Arizona Corporation Annual Report

The Arizona Revised Statutes requires all corporations as well as other associations registered with the state to file an Arizona annual report. If you incorporate a new company then unlike a limited liability company, your corporation will have to file the annual report pursuant to AZ Rev Stat § 10-1622 (2019). Normally, an annual report is considered to be a financial document. This report may contain detailed financial information about small and large corporations. Although, different states require corporations to provide particulars other than financial information as well.

What does it include and how to file it?

An Arizona annual report for corporations require the following information pursuant to AZ Rev Stat § 10-1622 (2019) –

• Name of the corporation and the state law under which it has been incorporated (Arizona)
• Address of its known place of business
• Name and address of its Arizona statutory agent
• Address of its principal office
• Name and address of the principal officers or directors
• Names of shareholders
• Brief description of nature of business
• Total number of authorized shares along with class and series
• Issued and outstanding shares
• Certificate of disclosure

What is the due date for filing?

Normally the due date for an annual report filing may depend on the entity structure and whether your corporation is a domestic or foreign entity. The 2019 Arizona Revised Statutes states that you need to file an Arizona Corporation annual report by the registration anniversary date. This means that the filing date for this report will not be the same for all corporations. You can find the due date for your corporation by checking your company’s record on the eCorp Search page. An Arizona annual report can be filed 30 days prior to the due date. The processing fee is $45 and if you opt for an expedited service then there will be an additional fee of $35.
If you have hired IncParadise as your Registered Agent for Arizona Corporation then you can take advantage of our entity management software. This software will help you to file the annual report on time, which is on or before the due date. This will ensure your company is in compliance with Arizona Corporation annual requirements.

Penalties if you fail to file

If your company or any corporation is unable to deliver the Arizona annual report within the time specified in AZ Rev Stat § 10-1622 (2019), you may be subjected to penalties. The penalty charged will be $9.00 per month. Your corporation will be sent a delinquency notice almost 90 days after the due date. Your company status will be changed to Pending Inactive. If you are unable to file an Arizona Corporation annual report 60 days after receiving the first delinquency notice then your corporation may receive a Notice of Pending Administrative Dissolution/Revocation.

Thinking of filing an Annual Report for Arizona Corporation!

Arizona Corporation Taxes

When you incorporate in this state, you will have to ensure complete compliance with Arizona Corporation annual requirements. One such requirement is that of filing taxes. There are different forms of taxes in this state but it is not necessary that your company will be required to file all of them. As a corporation, one of the most important would be to file a federal corporate tax return (form 1120/IRS) on all your profits. This can be filed in the form of quarterly payments to the IRS. If you own stock in the corporation then you will be required to file individual income tax on your salary and bonus. Apart from these corporation taxes in Arizona, you may be required to file taxes on dividends. This is also known as double taxation.

Arizona Sales and Use Tax

One of the important Arizona Corporation annual requirements is that of filing sales and use tax. Most states in the USA have sales tax and use tax filed separately or together. This type of tax is based on business activity and location of a business. In the state of Arizona, the sales tax is also known as the state transaction privilege tax (TPT). The TPT rate or the corporation taxes in Arizona rate is 5.6 percent. This is a state sales tax rate and there is also a combined state and local sales tax rate of 8.38 percent. It is important to note that the use tax rate can vary from one county or city to another. For example: The use tax rate for Retail Sales in Apache Junction is 2.40 percent and is 3 percent in Coolidge.

Employee and Employer Taxes

As an employee in a corporation, the most important tax would be the individual income tax. If you are an employee and a shareholder or owner then you will also have to file taxes on the dividends earned on shares or stock. This also brings us to payroll taxes, which is another important type of corporation taxes in Arizona. The employers of a corporation have to withhold taxes from the employees being paid for any work done within this state. There is an exception though for remote workers.

Need any Assistance in Filing the Arizona Corporation Annual Report?

The Arizona LLC annual requirements or those for a corporation are different especially when it comes to filing taxes and annual reports. The annual report is one of the most important documents although LLC’s are not required to file. Taxes on the other hand have to be filed by both types of entity structures i.e., LLC and corporations.