How to Form an Arizona LLC without Disclosing Its Ultimate Owner(s)

By Richard Keyt, an Arizona LLC attorney who has formed over 2,500+ Arizona LLCs.

Arizona limited liability company law requires that the names and addresses of members of the LLC must be disclosed in the Articles of Organization. Arizona Revised Statutes Section 29-632.A provides that:

	If the LLC is member managed (the type of management is specified in every LLC's Articles of Organization), the names and addresses EVERY member must be stated in the Articles of Organization.
	If the LLC is manager managed, the names and addresses of all managers and ONLY those members who own 20% or more of the company must be stated in the Articles of Organization.

The names and addresses of members and managers of an Arizona LLC will be displayed on the Arizona Corporation Commission's website and easily available to anybody who looks up the LLC's name or the name of a member in the ACC's online database.

Often people contact me and ask how they can form and own an Arizona LLC that does not disclose their names as an owner. My answers to that question are:

The ILLEGAL WAY. You can commit fraud and intentionally file Articles of Organization with the ACC that does not disclose the true owner(s) of the LLC despite the Arizona law (Section 29-632.A) that requires that the name(s) and address(es) be disclosed. Of course I do not that any body take this approach. I urge people not to do this because it is illegal and a felony under Arizona's LLC statutes.

See ARS Section 29-657. Liability for false statement in articles. See also ARS Section 13-2407, which states:

"A person commits tampering with a public record if, with the intent to defraud or deceive, such person knowingly: . . . files . . . in a governmental office or agency a written statement which has been falsely made, completed or altered or in which a false entry has been made or which contains a false statement or false information . . . . Tampering with a public record is a class 6 felony."

The HARD & EXPENSIVE WAY. Form two Delaware LLCs, the second of which will register to do business in Arizona. This does not involve forming an AZ LLC, but it accomplishes the same thing - creating an LLC that is authorized to do business in Arizona.

Delaware LLC law does not require that the name or address of any member or manager be in the Articles of Organization filed with the Delaware Secretary of State to form the LLC. The only information required in the Articles of Organization of a Delaware LLC is the name of the LLC and the name and address of the LLC's registered agent in Delaware.

LLC #1, the parent company, is owned by the ultimate owner. LLC #2, the subsidiary company, is owned solely by LLC #1. LLC #2 then registers to do business in Arizona, which registration requires that LLC #2 disclose in its Application for Registration filed with the ACC who owns LLC #2. Because LLC #2 is owned by LLC #1, the name of the ultimate owner does not appear in the records of the ACC as having any involvement with LLC #2 or #1.

Note: The person who signs as the manager of LLC #1 will have his or her signature on any documents filed with the ACC on behalf of LLC #2. To avoid having the ultimate owner sign his or her name as a member or manager of LLC #1, someone other than the ultimate owner should be the manager of LLC #1. This is a very expensive solution because it is expensive to form and maintain two Delaware LLCs plus there is a high cost to register LLC #2 to do business in Arizona.

The EASIEST WAY - the TRUST OWNERSHIP WAY. A simple solution if done right is to have your revocable living trust own your interest in the Arizona LLC. If a trust owns an interest in the LLC, the trusts can be can be listed in the Articles of Organization as a member under the name of the trust. For example, the XYZ Family Trust under Agreement dated July 4, 2010 can be listed as a member of an Arizona LLC in its Articles of Organization as "XYZ Family Trust."

The names of the trustee(s) are not required to be listed in the AOO. If your trust has a name that does not disclose your name, you can name your trust as a member of the Arizona LLC. Note: If Homer & Marge Simpson want to avoid having their names in the AOO of an Arizona LLC, they will not be successful if their revocable living trust is called the Homer & Marge Simpson Trust because if their trust is a member of an Arizona LLC, it will be listed in the Articles of Organization as a member under the name "Homer & Marge Simpson Trust," which discloses their identities.

Address of Member & LLC Place of Business Caveat

Arizona law requires that the LLC's known place of business in Arizona and the address of the member be stated in the Articles of Organization. If confidentiality is your goal, you probably do not want to list your home, business or other address in the Articles of Organization because it could be an easy way for somebody to discover that you are associated with the LLC.

Solution: Get a new U.S. post office box or a UPS mailbox. If we form your LLC, you can use our address service for $100 a year, which allows the member and the company to use my law firm's address in the Articles of Organization.

If You Do Not Have a Trust, Hire Me to Prepare a Confidential Trust

If you want to form an Arizona LLC and avoid having your name in the LLC's Articles of Organization and you do not have a trust, I can prepare a trust for you for

	$297 if I form your LLC
	$497 if I do not form your LLC

My Confidential Trust is an Arizona trust that has the following characteristics:

	It's revocable - you can amend, revoke or terminate it at any time unless you die or become incapacitated.
	You are the beneficiary of the trust. If you are married and want joint ownership with your spouse, then both spouses will be beneficiaries.
	If you are married and both you and your spouse are beneficiaries, then if one spouse were to die, the other will continue as the sole beneficiary.
	If the sole beneficiary were to die, the trustee is directed to assign the membership interest to estate of the beneficiary and terminate the trust. Caution: This trust is not intended to be a substitute for an estate planning trust that avoids probate and disposes of assets after death to designated heirs or alternate heirs. If you need an estate planning trust and also want to keep the ownership of your Arizona LLC confidential, you should purchase our inexpensive Simple Revocable Living Trust for $697.
	You will be the trustee. If you and your spouse are both beneficiaries, then both of you will be trustees.
	If both spouses are trustees and one were to die or become incapacitated, the other spouse would continue as the sole trustee.
	If the sole trustee were to die or become incapacitated, the person you designate as successor trustee will become the trustee.
	The trustee has the power to exercise all ownership rights as a member of the LLC, including, but not limited to, voting rights, the right to sell, encumber or dispose of the membership interest and the right to receive all distributions of money or property from the LLC.
	The trust will be a grantor trust for federal income tax purposes, which means: (i) the IRS treats the trust as if it does not exist, (ii) the trust does not need a federal employer ID number, (iii) the trust does not file federal or Arizona state income tax returns, and (iv) all profits and loses of the member of the LLC are passed on to the beneficiaries of the trust who report it on their IRS Form 1040.

How Do I Hire You to Prepare a Confidential Trust?

If you want me to prepare a Confidential Trust for you, the simplest and least expensive way is to hire me to form your Arizona LLC ($599) and prepare the Confidential Trust for $297, a $200 discount off the $97 price if I do not form your LLC.

How to Hire me to Form an LLC and Confidential Trust

Call me, Arizona LLC attorney Richard Keyt, at 602-906-4953, ext. 1, if you have any questions about forming or operating your AZ LLC or creating a trust. I don't charge for to answer these questions. When you are ready to form your LLC:

Click on this link to go to my LLC Formation Agreement and follow the instructions to complete the online form and pay in our secure web store, or

Call me at 602-906-4953, ext. 1 or my LLC legal assistant Katie at 602-906-4953, ext. 7 and give one of us your LLC, trust information and Visa or MasterCard information over the phone. It only takes 5 - 10 minutes.

If You Have a Trust with Your Name in the Trust's Name

If you already have a revocable living trust, but your name is in the name of the trust, simply amend the name of the trust to something that does not disclose your name. After you amend the trust, you can then form the new Arizona LLC with the trust named as the member in the Articles of Organization. Make the LLC a member managed LLC to avoid having to name a manager in the Articles of Organization, which would be required in the LLC were a manager managed LLC.

I charge $195 to prepare an amendment to an existing trust for the sole purpose of changing its name. Call me and I can gather the information needed to amend your trust.

About the Author

Richard Keyt, J.D., LL.M. (income taxation New York University Law School) is a business, real estate, transactions, contracts and estate planning attorney licensed to practice law in Arizona. He has formed over 2,500+ Arizona limited liability companies in the last few years because his low cost high quality LLC package is second to none and it only costs $599 for everything. Rick has practiced law in Arizona since 1980. Rick can be reached by telephone at 602-906-4953, ext. 3. Email at rickkeyt@keytlaw.com and fax at 602-297-6890. Rick's web site located at www.keytlaw.com had over 3,000,000 visitors in 2006 - 2008. To follow Rick on Twitter go to www.keytlaw.com/twitter. Rick does not accept matters involving landlord / tenant disputes or litigation of any kind (other than tax lien foreclosures). Communicating with Richard Keyt via email or otherwise does not cause you to become a client or cause your communications to be confidential or subject to the attorney client privilege.

KEYTLaw LLC Formation Records: day: 17 (6/4/08); week: 27 (week ending 6/7/08); month: 64 (6/08); year: 425 (2007)

Get AZ LLC attorney Richard Keyt's free white paper called "10 Critical Facts Every LLC Owner Must Know."

Join our free Arizona LLC email newsletter list.

Compare Richard Keyt's complete LLC package for $599 with what you get and what you will pay else where. See testimonials from satisfied LLC clients.

Call 602-906-4953, ext. 1 NOW if you want an LLC to: (1) prevent creditors of your business or investment real estate from taking your personal assets, and (2) asset protect your personal assets from debts, liabilities and lawsuits.

To hire Arizona LLC attorney Richard Keyt to form your AZ LLC, complete the KEYTLaw LLC Questionnaire online. Service includes our Quick Start Guide - a 100+ page Arizona LLC owner's manual.

If You Do Not Hire KEYTLaw to Form Your AZ LLC, Give Yourself Peace of Mind and Purchase Our Quick Start Guide - Only Available from KEYTLaw.com

What you don't know about operating your Arizona LLC could cost you thousands of dollars or possibly risk a court "piercing the veil" and holding the members of the LLC liable for its debts. Arizona business attorney Richard Keyt's in depth, Arizona specific 100+ page Arizona LLC Quick Start Guide is the Holy Grail about operating Arizona LLCs. Merriam-Webster's dictionary defines "Holy Grail" as "an object that is sought after for its great significance," a term that aptly describes the AZ LLC Quick Start Guide.

How to Purchase the QSG

This owner's manual for operating an Arizona LLC explains 75+ critical topics that affect Arizona LLCs. See the five page Table of Contents and you will be amazed that so many important topics are explained in one convenient source. Click here to purchase the Quick Start Guide now from our internet store for the incredibly low price of $99. Ignorance of Arizona LLC law and how to operate your Arizona LLC could be very costly.

To order attorney prepared change of member documents for your AZ LLC, click on the Transfer of LLC Interest Agreement link

To order an attorney prepared Operating Agreement for your AZ LLC, click on the OA Questionnaire link

This page was last modified on August 21, 2010.

Subscribe to Richard Keyt's Free Email Newsletters