How to Form an S Corp in Arizona

Choose a name for your S corporation

New business owners should start by selecting a memorable name for their S corporation. Check the Arizona Corporation Commission’s business name database to ensure the name is not already in use. Your chosen name must include “Corporation,” “Incorporated,” or an abbreviation like “Inc.” or “Corp.”

If you’re not ready to file immediately, Arizona allows you to reserve your name for 120 days for a small fee of $45 as of 2024.

Find your registered agent

You’ll need a registered agent who lives in Arizona to receive legal paperwork on behalf of your S corporation. This agent can be a close friend or a hired professional. You can even be your registered agent if you’d like.

Be sure that whoever you choose is fit for the job. A reliable agent is essential for maintaining good standing for your business.

Filing the Articles of Incorporation

Arizona business owners must file the Articles of Incorporation with the Arizona Corporation Commission. This document includes basic information about your business, including its name and address. As of 2024, the Articles of Incorporation filing fee is $60 to $95, depending on if the process is expedited. Once approved, the government will officially recognize your S corporation.

Create and adopt corporate bylaws

Businesses use corporate bylaws to define their S corporation’s internal rules, including electing board members and operating the business. Arizona requires these laws, so create them before incorporating your business.

After drafting your bylaws, you must have a board meeting to adopt them. This meeting will also be where the company elects officers and addresses other foundational matters. 

You will also issue stock to shareholders, defining their ownership and voting rights within the company. S companies can have up to 100 shareholders at one time.

Get Your Employer Identification Number (EIN)

Your S corporation needs an Employer Identification Number (EIN) from the IRS. You will need this number to complete critical business tasks, such as paying taxes and hiring employees.

Obtain your S corporation status with the IRS

Businesses must file IRS Form 2553 if they want to be taxed as an S corp. This form needs to be filed at the beginning of the new tax year or within two months and 15 days of forming your corporation.

Obtain business licenses and permits

S corporations often need licenses to operate in Arizona. Some companies require industry-specific licenses, including healthcare or liquor licenses. These licenses prove the company appropriately follows industry standards and sells safe products or services.

For more information on licenses and how to obtain them, visit Arizona’s Department of Revenue website.

• Savings on taxes: S corporations do not pay federal income taxes. Instead, the profits pass through to shareholders, who report them on their tax returns.
• Perpetual existence: An S corp will continue to exist even if the owner changes, providing stability and allowing for continuous growth.

• Enhanced credibility: Incorporation adds a layer of professionalism and trustworthiness to your business. This credibility can not only attract more customers but also make obtaining loans and investors more easy.
• Limited liability protection: S corp shareholders’ assets are protected from business liabilities and debts.