FAQs Archives

Should I Form a Do-It-Myself Arizona Corporation?

Question: I am considering forming an Arizona corporation myself. All I have to do is complete the Arizona Corporation Commission’s three page fill in the blanks Articles of Incorporation and file it with the Arizona Corporation Commission. Why should I hire you to form my new corporation?

Answer: Wow! This is an actual question somebody asked me recently. The question always reminds me of another question, “would you perform surgery on yourself?” OK, it’s not quite the same thing, but there are a lot of reasons why people should not form corporations or limited liability companies themselves or use document preparers. Here are a few.

First and most important, the Arizona corporation is almost always obsolete and should rarely be used. Arizona corporate law does not give the shareholders charging order protection unlike Arizona LLC law that provides that the sole remedy of a creditor who gets a judgment against a member of an Arizona LLC is to serve a charging order on the LLC. The legal significance of the difference is that if a creditor gets a judgment against a stockholder of an Arizona corporation, the creditor can sell the stock at an auction and it is lost forever. However, if the creditor gets a judgment against a member of an Arizona LLC, the creditor can get a charging order, but cannot force a sale of the membership interest in the LLC. Bottom line: If a you own stock in an Arizona corporation and a creditor gets a judgment against you, you will probably lose your investment in the stock forever. If you are a member in an Arizona LLC and somebody gets a judgment against you, Arizona’s LLC law prevents the loss of your investment in the company.

Arizona corporations must file an annual report with the Arizona Corporation Commission and pay an annual fee of $45. Arizona LLCs do not file an annual report with the ACC or pay it an annual fee.

If an Arizona corporation fails to file its annual report, the Arizona Corporation Commission will terminate its existence. Let me say that again slower. T h e A C C w i l l k i l l the c o r p o r a t i o n! What do you suppose happens to the corporate shield provided by an Arizona corporation when it dies? It evaporates! When the ACC revokes the charter of an Arizona corporation because it did not file an annual report, the legal significance of the revocation is that the shareholders no longer have a corporation – they have a common law Arizona general partnership and every one of them is 100 percent liable for everything that goes wrong. If you have an Arizona LLC there is no annual report so you cannot forget to file it and the ACC cannot terminate your company for failing to file the annual report. If you think revocations are rare, think again. For its fiscal year ending June 30, 2011, the ACC revoked the existence of 18,342 Arizona corporations – that’s 10% of all Arizona corporations.

If you insist on forming your own corporation, the before you pull the trigger, do your self a favor and read the read “How To Incorporate In Arizona.”

For more reasons why you should not form an Arizona corporation, read my articles called “Best Arizona Entity to Form,” “LLC vs. Corporation” and “Two Phases in the Life of an LLC.”

Having said the above, if anybody insists on forming an Arizona corporation, I am happy to oblige that person. I do form Arizona corporations, but it happens less and less as time goes by and more and more people realize that the limited liability company is the entity of choice in Arizona.

Richard Keyt2016-11-16T08:23:54-07:00July 17th, 2011|Asset Protection, FAQs, Forming LLCs|0 Comments

What are the Differences Between an Arizona PLLC vs LLC?

Question: Arizona pllc vs llc: What are the differences between an Arizona professional limited liability company and an Arizona limited liability company and when would somebody form a PLLC instead of an LLC?

Answer: Only three percent of Arizona LLCs are PLLCs. Few people are required to form an Arizona PLLC.

Arizona Revised Statutes Section 29-3401.4 states: “‘Professional Limited Liability company’ means a limited liability company organized under this Chapter for purposes that include rendering one or more categories of professional services.”

This means that an Arizona PLLC is an LLC that provides professional services that may be performed only by a person who is licensed by a limited number of professions in Arizona such as medical doctors, certified public accountants, attorneys and real estate agents.

The following provisions apply only to AZ PLLCs:

1. The Articles of Organization must state that the company is a professional limited liability company.

2. The Articles of Organization must state the professional service or services that the company is organized to provide.

3. The name of the PLLC shall contain the words “professional limited liability company” or the abbreviations “P.L.L.C.”, “P.L.C.”, “PLLC” or “PLC”, in uppercase or lowercase letters.

4. A professional limited liability company may issue membership interests only to:

a. Individuals who are licensed by law in Arizona or another state to render a professional service described in the articles of organization of the professional limited liability company. The following are not violations of this restriction: i) Any community interest of an unlicensed spouse in the membership interest issued to a licensed spouse in which the unlicensed spouse with a community interest in the membership interest does not have the right to vote the membership interest, or (ii) Issuance of a membership interest to a trust established for the benefit of a licensed individual or members of the licensed individual’s immediate family in which the licensed individual has the right to vote the membership interest and the trust and the members of the licensed individual’s immediate family do not have the right to vote the membership interest.

b. General partnerships, registered limited liability partnerships, other partnerships and joint ventures, domestic or foreign, in which all of the partners are licensed persons with respect to the profession to be conducted by the professional limited liability company and in which at least one partner is authorized by law in this state to render a professional service described in the articles of organization of the professional limited liability company.

c. Professional corporations, professional limited liability companies and other persons, domestic or foreign, authorized by law in Arizona to render a professional service described by the articles of organization of the professional limited liability company.

d. Other persons, if after the issuance of voting membership interests, the other persons in the aggregate do not hold more than forty-nine per cent of the membership interests entitled to vote for the election of officers and managers of the professional limited liability company, unless a greater or lesser percentage is prescribed by the board.

Membership interests and rights or options to purchase membership interests of a professional limited liability company that are held by persons described in 4, a, b & c may be transferred or pledged, whether voluntarily, involuntarily, by operation of law, by court judgment or otherwise, only to persons qualified under subsection B to be issued voting membership interests and to the professional limited liability company. Voting membership interests and rights or options to purchase voting membership interests of a professional limited liability company that are held by persons described in subsection B, paragraph 4 may be transferred or pledged, whether voluntarily, involuntarily, by operation of law, by court judgment or otherwise, only to persons who are qualified under subsection B, to be issued voting membership interests and to the professional limited liability company.

To my knowledge, the only profession that requires its licensed professionals to form an Arizona PLLC is the real estate sales agent profession (not real estate brokers). Arizona realtors do not have to form a professional corporation or a professional LLC unless they want their real estate commission paid by their broker broker to an entity rather than directly to them. Doctors, lawyers and accountants in the past were required to form Arizona professional corporations or Arizona PLLCs, but not currently.

The Arizona Department of Real Estate requires the following of real estate agent’s PLLCs:

The name of the PLLC or PC be the name of the professional as it appears on the real estate agent’s license, and

The Professional Corporation or Professional Limited Liability Company Name, through and on behalf of which a salesperson or broker acts, shall consist of only the full or last name(s) of its shareholder(s) or member(s), and contain the words “Professional Corporation,” “Professional Limited Liability Company”, as applicable, or the abbreviations authorized under Arizona Revised Statutes Sections 10-2215 or 29-4106, as applicable, to reflect that it is a Professional Corporation or Professional Limited Liability Company, and shall reflect whether it comprises one or more licensees (single or plural as in John Smith, P.C. or Smith & Smith, P.C.).

For a designated broker, PC/PLLC name shall only consist of the broker’s full or last name, and words or abbreviation to indicate it is a PC or PLLC.

A PC or PLLC shall not have a fictitious name.

The Articles of Organization of a PLLC formed for a real estate agent contain the following statement: “The sole purpose of the Professional Corporation (or Professional Limited Liability Company) is to render professional real estate services.”

Read “Can an Arizona LLC Become a PLLC & an Arizona PLLC Become an LLC?“

Richard Keyt2021-06-04T13:41:47-07:00July 12th, 2011|FAQs, PLLCs|27 Comments

How Do I Check the Arizona Corporation Commission for the Status of My Arizona LLC?

Question: How can I check the records of the Arizona Corporation Commission to see if my new LLC’s Articles of Organization have been approved or if the information listed for the company and its members and managers is correct?

Answer: Search for the LLC on the Arizona Corporation Commission’s name search database. If any LLC information displayed is incorrect, a member (if member managed) or a manager (if manager managed) must take action to correct the bad information.

If an address of the company or the statutory agent is wrong, file a Statement of Change of Known Place of Business Address or Statutory Agent with the ACC. If the address of a member or manager is wrong file a Statement of Change of Manager or Member Addresses with the ACC.

A member (if member managed) or a manager (if manager managed) of an LLC must file an Articles of Amendment to the Articles of Organization to correct any of the following errors:

The LLC is member managed and the ACC’s records show a person or entity that is no longer a member or does not show a person or entity that is a member.

The LLC is manager managed and the ACC’s records shows a person or entity: (i) that is no longer a member, or (ii) who no longer owns 20% or more of the LLC

The LLC is manager managed and the ACC’s records do not show a person or entity who owns 20% or more of the LLC.

The LLC is manager managed and the ACC’s records show a person or entity that is no longer a manager or does not show a person or entity that is a manager.

Richard Keyt2019-07-04T10:42:12-07:00July 11th, 2011|FAQs, How Do I|0 Comments

How Do I Open a Bank Account for an LLC?

Question: I just formed by new Arizona limited liability company. I now need to open a bank account in the name of the LLC. How do I open the account?

Answer: Tell the bank you want to open a bank account in the name of the LLC. Give the following to the bank officer:

A copy of the LLC’s Articles of Organization with either the Arizona Corporation Commission’s “received” stamp or its “filed” stamp. Most banks will accept the Articles of Organization before it has been approved by the ACC. A few, however, require a copy of the Articles of Organization approved by the ACC with the “filed” stamp on it.

The LLC’s federal employer identification number (EIN). To learn how to get an EIN for an LLC, read my article called “How Do I Get a Federal Employer Identification Number for an LLC?“

A few banks also require a copy of the LLC’s Operating Agreement. If you do not have an Operating Agreement for your Arizona LLC hire me to prepare a custom Operating Agreement by completing and submitting our online Operation Agreement Questionnaire.

If you want to open a bank account immediately after submitting the Articles of Organization to the ACC, you must hand deliver two copies of the Articles of Organization to the ACC. Give one copy to the ACC and ask the ACC clerk to stamp the copy with the ACC received stamp and return it to you. Use this copy to open the LLC’s bank account. If you do not follow this procedure, you will not be able to open the LLC’s bank account until you receive the approved Articles of Organization from the ACC one to four week after the submission date. Check the upper right hand corner of this website for the date of documents filed on an expedited basis that are being reviewed by the ACC.

I recommend that you get an EIN for your LLC. Banks will allow you to open a bank account in the name of the LLC if you give the bank your social security number. In this age of identity theft, it is better to get an EIN for the LLC so you do not have to give out your SSAN to banks or others from time to time.

Richard Keyt2019-07-04T07:55:38-07:00July 11th, 2011|FAQs, How Do I|4 Comments

Can an Arizona LLC Have Officers Such as a President?

Question: Can an Arizona limited liability company have a President, Vice President, Chief Executive Officer or personnel with other titles?

Answer: Yes. Arizona’s statutes that authorize the creation of LLCs do not restrict the titles a company may give to its employees or personnel.

Technically, corporations have presidents and CEO, but Arizona LLCs do not. Arizona law mentions only three types of people or entities associated with an AZ LLC: members (owners), managers (equivalent to the president of a corporation) and noneconomic members (neither a member nor a manager, but a special character that is not defined in Arizona law).

You LLC has Articles of Organization. Corporations have Articles of Incorporation.

Arizona law provides for two types of LLCs: member managed and manager managed. Only member managed AZ LLCs have managing members. In fact, AZ law provides that all members of a member managed LLC are managing members and have management power.

If you have a manager managed AZ LLC and you sign as manager on behalf of the LLC, you are complying with Arizona law and clearly indicating to the other party the capacity in which you sign the document. This is important to avoid personal liability.

Arizona law does not say that your LLC cannot have a president or a CEO. It’s your company and as the controlling member you can create any LLC office you desire and call it whatever you want to call it. The problems with calling somebody the President of your AZ LLC are:

1. People who understand Arizona law will not accept the signature of a person whose title is President because they know that a member must sign for a member managed Arizona LLC and a manager must sign for a manager managed Arizona LLC. Prudent people will look up the LLC on the Arizona Corporation Commission’s website to see if the LLC is member managed or manager managed and insist that the contract be signed by the appropriate person named in the LLC’s Articles of Organization on file with the Arizona Corporation Commission.

2. There is a risk that if the contract results in a lawsuit, the other party could claim they thought they were dealing with a corporation rather than an LLC and therefore your company would be required to prove it complied with AZ corporate law rather than AZ LLC law to get the protection afforded by Arizona law to the owners of those types of entities.

3. The other party to the contract might also claim the signer misrepresented the signer’s capacity to sign the contract.

Read about the perils of signing contracts on behalf of an entity in my article called “President of Corporation Personally Liable for Signing Contract.”

I do not recommend mixing corporate terms with LLC terms so you avoid the problems mentions above.

On the Net2016-11-16T08:23:54-07:00July 9th, 2011|FAQs, LLCs & Corporations, Operating LLCs|2 Comments

Should I Form an LLC before or after Acquiring Real Estate?

Question: I intend to purchase an Arizona real estate property for investment in the near future. My plan is to rent the home or I might fix it and then flip it. I know I need to put the property into a limited liability company to limit my liability and protect my life savings from things that could go wrong with the property. Should I form the LLC before or after the acquisition?

Answer: Either way is fine, but you can save yourself some administrative tasks and some money by forming the LLC first so it can be the grantee on the deed that conveys title. The important fact is that you make sure the LLC holds the title so that it will be the defendant in any lawsuit that arises from the property.

The benefits of forming the LLC first so it can take title are:

1. The LLC is the original owner named in the deed from the transferring property owner.

2. The LLC can be the insured on the property and liability insurance policies from day one.

3. The LLC can be named as the insured on the title insurance policy if you purchase title insurance at the time of acquisition, which as a real estate lawyer I recommend you always do.

If you purchase the land in your name first instead of in the name of your LLC then you must do the following after you form the LLC and acquire title:

1. Prepare a deed, sign it and record it in the county where the real estate is located.

2. Cancel the property and liability insurance policy and get a new policy that names the LLC as the insured.

3. Get an endorsement on the title insurance policy that names the LLC as an additional insured.

Warning: Do not sign and record a deed to the LLC before it is created. You cannot put the title in the name of the LLC unless it exists at the time the title is transferred. A deed to a nonexistent entity is void and creates a cloud on the title.

Richard Keyt2016-11-16T08:23:54-07:00July 7th, 2011|FAQs, Forming LLCs, Real Estate Issues|0 Comments

How to Transfer Land to an Arizona LLC

Question: How do I transfer land to an Arizona LLC?

Answer: You may have formed a limited liability company to help protect you from things that might go wrong with property you own. For the LLC to protect your personal assets from liability, it must hold the title to the land. To get real estate into a limited liability company, the current owners must sign a deed that conveys the property to the limited liability company and record the deed in the county where the real property is located. If you acquired title to the property in a transaction that went through an escrow company, ask the escrow company if it will prepare the deed. Sometimes the escrow company will prepare the deed for you for no charge or a nominal amount.

Some other issues to consider are:

1. If you transfer the title to the LLC, ask the title insurance company that issued you the title insurance policy on the land to give an endorsement to the title insurance policy as of the date the policy was issued that names the LLC as an additional insured on the title policy. The cost for this type of endorsement is typically $75. If you do not get the endorsement, the LLC will not have title insurance on the land unless it purchases a new policy.

2. Coordinate with the insurance companies that insure the property and arrange to get a new policy or policies of insurance that name the LLC as the insured. Alternatively, you could add the LLC as an additional insured on the existing insurance policy or policies. If you purchased fire insurance that names you as the insured and the home is damaged or destroyed in a fire, the insurance company will probably deny coverage because you are not the owner of the property. Make sure you have written evidence from the insurance company that says the LLC is covered as of the date the real estate is transferred to the LLC.

3. Consult with your insurance agent and make sure that you and your LLC are covered with all appropriate types of insurance that have high amounts of coverage. Examples of such insurance would be home owners and liability insurance, however the types of insurance you need depends in part on the actual business and/or activities of the LLC. An LLC that owns a home leased to a family needs different insurance types and coverages than an LLC that operates an assisted living facility.

Richard Keyt2019-06-15T11:00:44-07:00July 4th, 2011|Ask the KEYTLaw Girl, FAQs, Operating LLCs, Real Estate Issues|0 Comments

Why You Should Form an LLC?

Question: I understand that if I form a limited liability company to operate my business and I am the only person who provides services on behalf of the business that I can be sued and be liable for my acts or omissions that cause harm to third parties. Instead of forming an LLC, can’t I just load up on insurance and not form an LLC to operate my business?

Answer: You could, but I think that would be a costly mistake. When you operate a business, commercial insurance is always your first line of defense. Your business should never operate without appropriate insurance coverage. Consult with several experienced business insurance agents and get their advice as to the type of insurance and the coverage amounts that are appropriate for your particular business. Always buy as much insurance as you can afford of the type that is appropriate for your specific type of business.

You operate a business through a limited liability company because it is your second line of defense against things that can go wrong with the business. What if you have insurance and the insurance coverage is denied? What if a plaintiff gets a judgment that exceeds the amount of insurance coverage? If you don’t form an LLC to operate your business and a plaintiff gets a judgment that exceeds the amount of your insurance coverage against you as the owner/defendant, all of your personal assets are at risk.

Fundamental Fact of Business Life: Without an LLC to operate your business, you are 100% liable for every thing that goes wrong. Do you really want to be in that position and have all of your life savings at risk? It’s hard to predict how liability may arise, but if you operate the business through an LLC, the general rule is the owners are not liable for the debts or obligations of the LLC. Wouldn’t you rather start from the position that you are not liable for anything (except your own acts and omissions) instead of the position that you are liable for everything?

Bottom Line: I believe it is foolish to operate an Arizona business without adequate insurance coverage and without operating the business through a limited liability company or a corporation.

Yes, I form Arizona limited liability companies. I’ve formed 9,000+ AZ LLCs. For the reasons why so many people hire me to form LLCs, see the contents of our Bronze, Silver & Gold LLC formation packages.”

KEYTLaw Girl Shows What Is In Every LLC Portfolio

When we form a Silver or Gold Arizona LLC we put all of the LLC’s documents in a beautiful red Arizona Limited Liability Company portfolio with the documents organized behind tabs. Every LLC gets our custom drafted Articles of Organization, organizational resolutions signed by the members, the charging order enhanced Operating Agreement, the 170 page Arizona LLC Operations Manual ebook customized for the LLC, and a numbered membership certificate for each member.

We Answer LLC Formation Questions for Free

If you have questions about forming an Arizona LLC, contact Arizona LLC lawyers Richard Keyt (480-664-7478) or Richard C. Keyt (480-664-7472). We do not charge for entity formation related questions.

Two Easy Ways to Hire Richard Keyt to Form Your Arizona LLC

To learn about what is included in each of our three LLC formation packages see our $497 Bronze, $797 Silver & $1,297 Gold LLC formation packages comparison page.

We’ve made it very easy to hire Richard Keyt who has formed 9,000+ to form your new Arizona LLC. It’s a simple 5 – 10 minute process. To hire Richard to form your new LLC select one of the following two options:

Option 1 – Telephone

Call any of the following KEYTLaw people and give your LLC and credit card information over the phone:

Richard Keyt – 480-664-7478
Richard’s son LLC attorney & former CPA Richard C. Keyt – 480-664-7472
KEYTLaw legal assistant Amanda Duran - 480-664-7846

Option 2: Online – Available 24/7

Complete our LLC Formation Questionnaire.

Richard Keyt2023-10-24T10:07:28-07:00July 3rd, 2011|Asset Protection, FAQs, Forming LLCs, Why People Need an LLC|0 Comments

Graduate Essay Structure

Students on various educational levels are faced with professor’s expectations. These expectations push the students to achieve more and grab as much information about life and their professional background as possible. The same applies to the essay writing as they are supposed to meet teachers’ expectations as well.

The studies do also include the world contest of development and progress and students are required to participate in those as well. The students at the graduate level are required to perform on higher level and to cope with a greater number of assignments, courseworks, dissertation writing, etc. These assignments include graduate essays, graduate papers, research papers and term papers. One of the reasons that students are being assigned a greater number of papers to write is to teach them to manage and value their time. Pushing to their limits will definitely bring certain results that are going to be much appreciated in the workplace or real life. Otherwise, students may never got to know what they are truly capable of.

RESPONSIBLE, SERIOUS, ORGANIZED AND CAREFUL. Your graduate essay leads to certain thoughts about you as a professional, student and a person. If you make foolish mistakes and have given yourself less time to proofread your writings, a line of certain conclusions may be done about you. In case if reader finds mistakes, you are considered to be irresponsible, careless, not serious enough and disorganized.
BE PRECISE. By being precise we mean that you must put much effort into avoiding careless errors in your graduate essay structure and overall writing. Keep in mind, if you fail to do that your graduate essay will affect how you are perceived as a graduate student.
THOROUGH PROOFREADING. You must include more time for proofreading in order to see if any errors are made including both grammar and punctuation mistakes.
CAREFULL USE OF TERMINOLOGY. Make sure to clarify if you are using the right terms. You must have clear understanding of what particular terminology mean. See if you can figure out the difference “personal statement” and “personal statement”.

On the Net2017-07-02T22:29:01-07:00July 2nd, 2011|FAQs|0 Comments

Is Property Acquired During an Arizona Divorce Community Property or Separate Property?

Question: An Arizona resident in the process of getting a divorce wants to form an Arizona limited liability company. If he/she forms an Arizona LLC before his/her divorce is final, will the spouse own a community property interest in the new LLC?

Answer: It depends. Arizona law defines community property as all property acquired by either spouse during the marriage. There are two exceptions to this rule.

First, community property does not include property acquired during the marriage by gift or inheritance.

Second, community property does not include property acquired AFTER service of a petition for divorce, legal separation or annulment if the petition results in a decree of divorce, legal separation or annulment.

This means that if somebody gives money or property only to one spouse, the property is separate property unless the recipient changes the separate property to community property. Likewise, if a parent dies and leaves money or property to a married child, the money or property is separate property unless the recipient changes the separate property to community property.

Separate property can be changed to community property and community property can be changed to separate property. It is best to document changes in the character of property with a written document such as a deed. Married people who have separate property and who want to keep it as separate property must take care not to change the separate property into community property. Separate property can be changed to community property if it is titled in the name of both spouses, or if it is money, deposited in a joint bank account. Also, if community assets such as wages or salary are used to benefit separate property, it can cause some or all of the separate property to become community property. For example, if a man inherits a home from his parents and uses some of his salary, which is community property, to pay the mortgage or make improvements to the home, a part of the home will become community property.

Now, back to the question. If Spouse 1 is an Arizona resident and forms a new Arizona LLC after service of a petition for divorce on Spouse 2 and if the petition results in a decree of divorce, Spouse 1 is the sole owner of the interest in the LLC as separate property. Otherwise, Spouse 1’s interest in the LLC is deemed to be community property.

I recommend that an Arizona resident who is married and wants to ensure that he or she will be the sole owner of an interest in a new Arizona LLC should not rely on the divorce becoming final, but should get the non-owner spouse to sign a document in which the non-owner spouse disclaims any interest in the LLC. Of course, if the non-owner spouse will not sign the disclaimer, the divorce must become final for the owner spouse to own one hundred percent of the new LLC.

Richard Keyt2019-06-15T11:15:42-07:00July 1st, 2011|Ask the KEYTLaw Girl, FAQs|2 Comments

How Do I Check if a Name is Available for a New Arizona LLC?

Question: I want to form a new Arizona LLC. I know that the Arizona Corporation Commission will reject the Articles of Organization if the name of my new LLC is exactly the same as an existing Arizona LLC, corporation, limited partnership or tradename. How do I check the records of the ACC to see if my desired name is available?

Answer: Click on ACC Name Availability Database and then follow the instructions. Caution: If a name is available to use for your new Arizona LLC, it does not mean that your LLC’s use of the name is safe from a claim of trademark infringement. See for example “Las Vegas Revolver Saloon Sues Scottsdale’s Revolver Lounge for Trademark Infringement.”

Note: People sometimes mistakenly search for arizona secretary of state business entity search when they want to know if a name is available for an Arizona LLC or corporation. Do not search the Arizona Secretary of State’s website for LLC or corporation names because it is the Arizona Corporation Commission that determines is a name is available for an Arizona LLC or corporation.

Hire Us to Form an LLC

We’ve formed 9,000+ and have 349 five star reviews on Google and Birdeye because people love our low-priced LLC formation services. See the prices and contents of our three LLC packages. To hire us submit our online LLC formation questionnaire.

For free answers to questions about forming and operating Arizona LLCs and PLLCs call LLC attorneys Richard Keyt (the father) at 480-664-7478 or his son Richard C. Keyt at 480-664-7472.

Richard Keyt2023-10-24T10:00:09-07:00July 1st, 2011|FAQs, How Do I|0 Comments

How Do I Get a Federal Employer Identification Number for an LLC?

Question: I just formed my limited liability company. I know I should get a federal employer identification number (an EIN) for the LLC to open a bank account and to give to 1099 contractors and vendors. How do I get an EIN form my LLC?

Answer: The IRS makes it very easy to get an EIN with its online wizard. In a 5 – 10 data entry session a person connected with the LLC can get the EIN by answering a series of questions posed by the IRS’ website wizard. Apply for an Employer Identification Number (EIN) Online.

Richard Keyt2016-11-16T08:23:55-07:00June 20th, 2011|FAQs, How Do I|0 Comments

How Do I Reserve a Name for a to-be Formed Arizona LLC?

Question: I plan on forming a new Arizona limited liability company in the near future. How do I prevent somebody from taking my desired name before I form the LLC?

Answer: Submit a name reservation with the Arizona Corporation Commission. When approved, you will have the exclusive right to use the name for an Arizona LLC, corporation or limited partnership for 120 days. Before you attempt to reserve the name you must:

Review the Arizona Corporation Commission’s naming standards.

Check the Arizona Corporation Commission’s name database to see if the desired name is available. Don’t forget to put LLC after the desired name and select the LLC radio button.

If the name is available, click on the “reserve” name button to go to the name reservation screen.

The fact the ACC grants a name reservation does not guaranty that the name will be approved when an ACC examiner reviews the Articles of Organization. The name reservation expires after 120 days.

As to whether you should reserve a name and whether it is a waste of money, listen to the KEYTLaw Girl video called “Should You Reserve a Name with the Arizona Corporation Commission for Your New LLC or Corporation?“

Richard Keyt2018-10-07T10:14:38-07:00June 11th, 2011|FAQs, How Do I|0 Comments

How Do I Change the Name of an Arizona LLC?

Question: How do I change the name of an Arizona limited liability company?

Answer: The company must file Articles of Amendment to the Articles of Organization in which it notifies the Arizona Corporation Commission of the name change. Within sixty days after the ACC approves the amendment changing the name, a copy of the articles of amendment or restated articles of organization shall be published in a newspaper of general circulation in the county of the known place of business for three consecutive publications unless the company’s statutory agent’s address is in Maricopa or Pima county.

If publication is required an affidavit evidencing publication may be filed with the ACC. I recommend that the company always file an Affidavit of Publication with the ACC so it can prove years later that it satisfied the publication requirement.

For more on this topic see my article called “How to Change the Name of an Arizona LLC.”

Richard Keyt2021-01-02T16:25:11-07:00May 21st, 2011|FAQs, How Do I|2 Comments

Why Should I Hire You to Form My Arizona LLC Instead of Somebody Cheaper?

Question: I’m interested in setting up a single person LLC. However, the $597 fee that I see on your site is a bit higher than what I’ve been quoted elsewhere.

Answer: Did an Arizona LLC lawyer quote a lower fee or was it an uninsured document preparer? Is the other person certified as a legal document preparer in Arizona? Is the document preparer an out of Arizona company that is registered to do business in Arizona as required by Arizona law? How many LLCs has the person or document preparer formed in Arizona? I’ve formed 9,000+ Arizona LLCs.

Does the other person have any testimonials. We have many happy LLC clients. See our 349 five star Google, Facebook & Birdeye reviews.

What does the other person offer for their fee? See my list of formation services I perform to earn the low fee I charge.

Does the other person give you a book he or she wrote similar to the 170 page book I give people called the “Arizona LLC Operations Manual” that explains how to operate the company and comply with Arizona LLC law after formation of the company? I give my clients who hire me to form their Arizona LLC both the digital and hard copy versions of the OM. The digital version is generic, but the hard copy version is customized for each LLC.

I recommend you read my articles called:

“Should Richard Keyt or LegalZoom Form My LLC?“

“Why You Should Hire Arizona LLC Lawyer Richard Keyt to Form Your Arizona LLC Instead of an Uninsured Person or a Website that Doesn’t Tell You Who Will Work on Your LLC or Disclose Their Education & Experience Forming AZ LLCs.

If you are thinking of using a document preparer that is a company formed outside Arizona, you should:

Check to see if the doc prep entity that does business in AZ is registered to do business in AZ as required by ARS Section 29-3902.

Before using a document preparer, check to see if the preparer is a licensed AZ doc preparer or a de-licensed preparer.

Richard Keyt2021-01-03T14:03:19-07:00May 20th, 2011|FAQs, Forming LLCs|0 Comments

Should I Form an Arizona C Corporation or an S Corporation?

Question: Should I form an Arizona C corporation or an S corporation?

Answer: I form for profit corporations, nonprofit corporations, limited liability companies, and limited partnerships. I’ve formed 9,000+ LLCs since 2001. However, I do not form C corporations or S corporations because Arizona corporate law does not recognize or care about C corporation or S corporations. Those two terms describe one of four methods of federal income tax applicable to entities. Nobody forms S or C corporations in the United States. People form:

for profit corporations (obsolete in Arizona except for limited circumstances)
nonprofit corporations
limited liability companies (most popular entity in Arizona)
limited partnerships (obsolete in Arizona except for limited circumstances)
general partnerships (never ever form a general partnership because every partner is 100% liable for everything that goes wrong)
sole proprietorships (never ever operate a business this way because the owner is 100% liable for everything that goes wrong)
business trusts (rarely used and not appropriate in Arizona)

The first four types of entities are formed pursuant to the statutory law of each state. No state in the U.S. allows for the formation of a C or an S corporation, both of which are methods of taxing an entity under the federal income tax code.

Before forming an entity, the first question is in what state should I form the entity? The second question is what type of entity should I form? After you form the entity, the next question is how should the entity be taxed for federal income tax purposes?

If you form a corporation, it can be taxed two ways:

C corp – the default method, or
S corp – if the corp is eligible to be an S corp and all of the owners sign and submit an IRS form 2553 to the IRS before the deadline.

If you form a limited liability company, it can be taxed four ways:

C corp
S corp
Partnership if it has two or more owners
Sole proprietorship if it has one owner or a husband and wife owners who own the company as community property

One of the many reasons Arizonans are forming LLCs 12 times more often than corporations is because of the four methods of tax available to the LLC vs. the two methods of tax available to a corporation.

I recommend that as soon as possible after forming your entity, but not later than 75 days, you talk to your tax advisor to determine which method of tax is best for you and the entity.

I do form for profit corporations when there is a good reason to do so or if I cannot convince my client that the Arizona LLC is a much better entity than the Arizona for profit corporation. To date, I have formed 9,000+ Arizona LLCs.

For an in depth discussion of whether to form a corporation or a limited liability company in Arizona to operate a business or hold real estate, see my article on my website called, “LLCs vs. Corporations: Which Type of Arizona Entity Should You Form?“

Richard Keyt2019-06-15T08:14:25-07:00May 20th, 2011|Ask the KEYTLaw Girl, FAQs, Forming LLCs, Tax Issues|0 Comments

Who Should Borrow Money to Purchase Real Estate – Me or My LLC?

I’ve been an Arizona real estate and business lawyer since 1980. Based on my knowledge and experience the type of entity to form to hold Arizona real estate is an Arizona LLC. When I represent buyers of multi-million dollar properties the lenders always require that the borrower form a single purpose LLC to own the real estate. Over half of the 9,000+ LLCs I have formed have been to hold real estate. Your other choices are the corporation and the limited partnership. Both of these types of entities have been obsolete since Arizona enacted its LLC law in 1992. A general rule is never own investment real estate in a corporation because of adverse tax consequences. That’s why before 1992 the limited partnership, not the corporation, was the entity commonly used to own investment real estate.

When you have an LLC, you want the LLC to be the borrower that signs the promissory note and becomes obligated to repay the loan. The general rule is that if the LLC is the borrower, the owner(s) of the LLC are not liable to the lender to repay the loan if the LLC defaults.

A sophisticated commercial lender will require you to form an LLC and have the LLC be the borrower and take title at closing with you guarantying the loan. Single family home lenders and lenders that do not understand the legal reasons for having the LLC be the borrower will require the person to be the borrower. If your lender will not let the LLC be the borrower then you must be the borrower and take title in your name and then transfer the real estate to the LLC after closing.

If you are an owner of an LLC that will borrow money, the best structure for you is for the LLC to borrow the money and sign the promissory note without you signing a guaranty by which you promise to repay the lender if the LLC defaults. If you can do this, then if the LLC were to default on the loan and did not have sufficient assets to repay the loan, the lender would not be able to pursue you for the unpaid amount due to the lender.

Richard Keyt2019-06-15T08:22:29-07:00May 20th, 2011|Asset Protection, FAQs|0 Comments

Why Should I Purchase Your Buy Sell Agreement Instead of Getting a Free Buy Sell Agreement on the Internet?

Question: “We will be wanting a buy-sell agreement since none of the members of the LLC are related. However, after doing some research online it seems as though there are many customizable template type versions available for free. My question to you is concerning your pricing. You charge $500 for your Buy Sell Agreement when you form the LLC, yet it seems after reading through it all that it is just a template that you give everyone that purchases it and we essentially change it according to our needs (very similar to the free ones available online). Can you help me understand where the value is with your buy-sell agreement when purchasing with the LLC startup?

Answer: My Buy Sell Agreement is the product of my 31 years of experience as a business lawyer forming thousands of companies and dealing with the problems that arise between members/owners. It started as a limited partnership agreement I first created in the early 1980s. When Arizona adopted its LLC laws, I modified my limited partnership agreement to be an Operating Agreement for AZ LLCs. In the early 2000s I made substantial revisions to my standard LLC Operating Agreement that was about 45 pages and also created an Operating Agreement / combined Buy Sell Agreement that was about 90 pages long. During January and February of this year I spent over 40 hours splitting my 90 Operating Agreement with buy sell provisions into two separate documents – the Operating Agreement and the Buy Sell Agreement. I did a lot of research including buying Howard Zaritsky’s book called “Structuring Buy-Sell Agreements: Analysis with Forms” for $295. I incorporated a lot of his content into my new 35 page Buy Sell Agreement. You can purchase the book here.

I’m sure I have spent over 200 hours on my Buy Sell Agreement over the last 31 years. Most attorneys would charge $1,500 to $3,000 for a Buy Sell Agreement that would not be as good as mine. I can charge less because I use automatic document assembly software to create my documents and I do a high volume. Most business attorney’s don’t do one Buy Sell Agreement a month. I’ve spent over $30,000 over the years on professional programming of my automatic document assembly templates.

My Buy Sell Agreement does have optional language that the members must pick. For example, there are six different ways to value the interest of a selling member. Your members must read the six methods and decide which method is best for the group. The group may want to modify their selection. How many valuation options do you think you will get from your free form? Will it contain drag along and tag along provisions? Is the free or cheap form you get from the internet Arizona state law specific? If you needed surgery, would you want a doctor to do it or somebody who doesn’t tell you their name or experience and who advertises on the internet that they do free or cheap surgeries?

You have two clear choices:

Get something free or cheap from a source you don’t know anything about or know the experience of the creator of the document that may or may not be drafted to comply with Arizona law, or
Purchase a document prepared by a 31 year Arizona business lawyer for such a small amount of money that if your group cannot afford it then maybe it should not go into business together.

Richard Keyt2011-10-05T20:03:45-07:00May 19th, 2011|Buy Sell Agreements, FAQs|0 Comments

How Do I Speak to a Person at the Arizona Corporation Commission?

Question: How can I speak to a live person at the Arizona Corporation Commission about an Arizona LLC?

Answer: Call one of the following numbers:

Corporate Filings: 602-542-3026

Annual Reports: 602-542-3285

Records: 602-542-3026

Richard Keyt2016-11-16T08:23:56-07:00May 11th, 2011|FAQs, How Do I|0 Comments

How Do I Get a DBA for an Arizona LLC?

Question: How do I get a doing business as, aka a dba for my Arizona LLC?

Answer: Arizona calls a “dba” a trade name. An Arizona LLC gets an Arizona trade name (dba) by filing a Trade Name Registration Application with the Arizona Secretary of State and paying a $10 fee. The Arizona Secretary of State will reject the trade name if it conflicts with an existing name or an AZ LLC, corporation, limited partnership or trade name. Before applying for a trade name, read “How Do I Check if a Name is Available for a New Arizona LLC?“

For more on Arizona trade names see:

Arizona Secretary of State’s Trade name Popular Questions

Arizona Secretary of State’s Trade Name and Trademark Handbook

Arizona Secretary of State’s Trade name Search

Arizona Secretary of State Contact Information

Mailing Address: 1700 W. Washington Street, 7th Floor, Phoenix, Arizona 85007

In Person:

Phoenix Customer Service Center: State Capitol Executive Tower, 1st Floor, Room 103, Phoenix, Arizona

Tucson Satellite Office: Arizona State Complex Building, 400 West Congress, 2nd Floor, Room 252, Tucson, Arizona 85701

Questions: Call (602)542-6187 or 1-800-458-5842 (state of Arizona only)

Hours: Monday – Friday, 8am – 5pm, except holidays

Richard Keyt2018-05-09T15:31:54-07:00April 11th, 2011|FAQs, How Do I|0 Comments

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Matt P.

Seemingly too good to be true but KEYTLaw delivers as advertised - exceptional service and highly recommended. I can't imagine a more simple, efficient, and professional way to set up an LLC in full compliance. I was up and running in a day, got live phone support on my questions, and have continued to get benefit from all the guidance and content available to those who engage Keyt for this service. Fanatastic.

Carlene C.

Fabulous!!! Knowledgeable, fast and easy to work with!

Luc M.

I want to thank the Keyt Law team for all their help over the years. They do a great job and I appreciate their customer service. THANK YOU

Greg G.

Talk about service! I was unable to located my LLC "Operating Agreement" that Keytlaw formed in 2007. Called Rick and literally within a minute Rick was emailing me the agreement. Thank you Rick, y'all are the best!!

john D.

I was highly impressed by all aspects of Keyt Law in forming my LLC. Professional, very timely, and an overall excellent experience!! I will certainly do more business with them in the future. Highly recommend!!

Michael B.

The process was quick and easy. What I don't like are emails being sent in which they are not applicable to my company and are not required or needed.

Gaming with C.

KEYTLaw is truly outstanding, and exceeded our expectations with their stellar estate planning expertise and impeccable LLC services. We're immensely grateful for their exceptional work, feeling assured that their prowess truly defines the pinnacle of legal excellence."

Cheng S.

Very prompt and professional. I was even able to schedule a FREE 30 minute consultation prior to hiring them! Highly recommended!

Neel P.

Richard and his team are very experienced and knowledgeable in forming Trust and LLCs. They helped us to come up with an LLC structure that provides the protection we need for our investment properties. I was able to discuss with Richard and had all my questions answered within days of contacting the team. Besides the scheduled meetings, Richard also responded to calls and emails promptly to help us to make decisions quickly. I highly recommend Richard KeytLaw if you need help with LLCs, Trust, or any business formation.

Mei-Lin H.

Richard and his team is very experienced and knowledgeable in helping us to form LLCs. They helped us to come up with a LLC structure that provides the protection we need for our investment properties. We were able to discuss with Richard and had all our questions answered within days from contacting the team. Besides the scheduled meetings, Richard also responded emails promptly to help us to make decisions quickly. We really recommend Richard KeytLaw if you need help with LLCs.My husband and I have been researching the LLC laws and law firms for asset protection for a while. We had discussions with a few online companies including a nationally well-known company before making decision to go with KeytLaw. Some of them recommended overly complex LLC structures with a huge setting cost and on-going maintenance fee. We eventually decided to go with KeytLaw because of Richard's experiences and knowledge about Arizona Law, their accessibility, and their fee structure. We are very happy with the decision to go with Richard and plan to use their service for estate planning in the future.

Alyson L.

I would recommend KeytLaw for any legal services they need! They helped me form my LLC and it was very straightforward and quick I called and talked to both Richard and his son in regards to some questions that came up and they were very helpful. I will be returning for their help in the near future for my estate planning.

Alex R.

Richard is phenomenal. Top class service

KT B.

Very informative, professional and thorough. Very satisfied with my services and 💯 recommend!

Ricky G

The team at KEYT Law was awesome in helping me set up my business. The paperwork processing was a breeze, and they answered all the questions we had, KEYT Law is the best in the business in Arizona for your business set up needs.

Laura G.

The Keyts make it so painless to take care of your estate planning needs. With one reasonable flat fee for a package of documents you are all set.

Mike G

When a business has 5 stars on Google, do not hesitate. There is a reason. Amanda and Michelle are an absolute pleasure to work with and they work so quickly. My business is reality now thanks to this team.

Mozette “Ms. Mo” H.

Extremely knowledgeable, friendly and professional, easy process and fast and easy answers to my followup questions. I highly recommend KEYTLaw for your LLC formation.

Tom M.

I have multiple LLCs and by far thr Keyr team is the absolute best!

Kenny K.

The process of setting up an LLC was fast, easy, and professional. They answered all my questions quickly and provided excellent advice and perspective.

Tabatha W.

Richard has done multiple llcs for us and his office is professional and efficient.

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KEYTLaw, LLC made my LLC, Trust, Estate Planning, and custom contracts easy. I highly recommend them to any small business, especially medical practices.

Rudy I.

Helped me get what I needed to start my business. Thanks

james E.

Forming a new LLC could not be any easier! KEYTLaw is very quick and efficient. Will definitely use them again!

Carly W

I’m a new entrepreneur and recently started my first business, so I decided to open an LLC. Keyt Law had great online reviews, so I called them and am very happy I did! He answered all my questions over the phone and was very knowledgeable and friendly. I purchased their Gold Package, which included setting up a Trust to “own” the LLC as an added measure of security (I really like that my personal info won’t be public record). My LLC was established the same day, and I got my EIN the next day. Everything was done by phone, e-mail, and Docusign, which was convenient because I didn’t have to take time off work to go into the office. I even got a beautiful, professional portfolio mailed to me with all of my documents arranged behind organized tabs (which, as a brand new business owner, I was very excited to receive…not only is it great to have all my docs in one place, but also the portfolio itself looks really nice and makes me feel “official”)! Once you open your LLC they send out emails almost daily to remind you of things that need to be done for your new business, and to offer lots of other helpful information. This info is vital to new, inexperienced business owners like myself. There was 1 small issue with my trust, but it was resolved quickly. The price of the Gold package is very reasonable considering everything you get. If you’re looking to open an LLC in AZ I highly recommend Keyt Law!

Rob A.

Reached out to Keyt Law after floundering with setting up my LLC and I will never second guess what a great investment it was. The team was extremely helpful and responded quickly to all my questions. Our business was guided professionally through the LLC creation process. We have a foreign component and Keyt Law’s alert system saved us a potential IRS fine of 25,000$ if we had not filed a required form. Sincere thanks from all of us at our new business for setting us up on a solid footing.

Willie N.

Great service- quick and thorough!

MARK I.

What an easy and fast way of starting a LLC. It only took a short time to fill out the survey will all my information. Within 3 days my LLC was ready. Also, I get informative emails to keep me up to date in making sure there are no legal issues with my LLC. Overall, fantastic!

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Happy with Keytlaw service. I recommend them.

Storm M.

Good service and very thorough, price point seems about right and point person on first call was knowledgeable.

Joseph V.

Very informative, easy to work with, always available to answer questions, definitely will recommend

McKenzie L.

Richard was quick and efficient. He was readily available and answered messages quickly. I felt like he cared and was invested in us as in individual. Would highly suggest reaching out to him and his team.

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Great service and provided excellent guidance on how to structure membership/management of my LLC. All documents were provided in a very professional binder for ease of access and reference. Very happy with the service and will use again, highly recommended!

cbalsz

The Keyt firm made me confident I had everything covered as we launched my LLC. Their followup emails have kept me informed about operating my company. Their binder is professional and impressive to third parties who might question a startup newbie, but they can see I have the best legal advice.

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Very efficient and professional!

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Simple, seamless! Business was ready in 1 day!

Mike M.

I have been using Keytlaw since 2009 when I opened my first business in Arizona. They are always quick to respond and very helpful navigating the set up of a new business.

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KeytLaw set up my IRA LLC for me. The process was smooth and efficient. And Me. Keyt and Amanda were very nice and personable.

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Very helpful, quick response times. Overall very satisfied.

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They made setting up my LLC very easy and efficient

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Would recommend using Richard and his team. Made everything super easy and we are looking forward to using all of their services. Also recommend visiting there website sense it full of helpful information.

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Richard's team is awesome, very knowledgeable and responsive.

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Richard took care of me right away, communicated well initially and that communication continues to this day. My LLC is up and running in less than a month.

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They have made the process setting up our PLLC accounts very simple and stress free i would highly recommend using KeytLaw for any of your needs!

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Super, super responsive. Easy set up. Clear instructions via email and was willing to hop on quick calls with me to answer questions. Wish every partner was this easy to work with to set things up!

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Super fast reliable, right on point

Karen A.

I am in Real Estate and I sent over 100 clients a few years ago and he has been excellent! You want him on your side.

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I have used KEYTLaw several times to launch businesses in Arizona. They are professional and well versed in the ins-outs of getting setup quickly and correctly. I would absolutely recommend them to others looking to start their first business.

Chas D.

Richard made the process so simple and the turnaround time was fantastic. Richard answered my calls directly and thoroughly answered the questions I had.Great customer service and I will be contacting him in the near future for my Trust needs.

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