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By Arizona attorneys Richard Keyt (480-664-7478 & rk@keytlaw.com) and his son Richard C. Keyt (480-664-7472 & rck@keytlaw.com). We have 432 five-star reviews on Google, Facebook & Birdeye. Book a free office, phone or Zoom consultation.
In the article below you will learn about the Arizona LLC Ned Flanders formed with Homer and Marge Simpson. Ned contributed $1,000,000. The Simpsons only contributed money. The article explains the 14 nighmares Ned suffered because the members never signed an Operating Agreement.
Arizona law does not require an LLC to have an Operating Agreement. That is exactly why so many Arizona LLCs get destroyed by the lack of one. When the members of a multi-member LLC never sign a well-drafted Operating Agreement, Arizona’s default LLC statutes write the rules for them, and those default rules are almost never what the members actually agreed to.
Here is what the defaults can do to you: the member who contributed all the money gets one vote out of three. Profits are split equally no matter who invested what. Cash distributions must go out in equal shares. A member who steals from the company cannot be removed without a lawsuit. The other members can borrow against company real estate and split the loan proceeds equally. When a member dies, his interest goes through probate and his heirs inherit the right to receive money but no right to vote. And the member who wants out discovers there is no buyout provision, so his capital is trapped in a company he no longer controls.
This article tells the story of three people who formed an Arizona restaurant LLC on a handshake. Ned Flanders contributed $1,000,000 for 90% of the company. Homer and Marge Simpson contributed services for the other 10%. Everybody shook hands, nobody signed anything, and everything the three of them thought they agreed to turned out to be legally meaningless.
You will read the 14 nightmares that hit their LLC, why Arizona’s default statutes caused each one, and the exact Operating Agreement provision that would have prevented it. A side-by-side table at the end of the article compares every nightmare to its fix, followed by answers to the questions Arizona LLC members ask most often about Operating Agreements. If you own an interest in an Arizona LLC that does not have a signed Operating Agreement, read this before the nightmare is yours.
Ned's Nightmare
Arizona LLC Resource Center: Form, Operate & Protect Your LLC
Everything you need to know about forming, owning and operating an Arizona limited liability company is here in one place. Learn how to form an LLC, choose an Operating Agreement, protect your personal assets, add or remove members, transfer real estate to an LLC, amend your LLC, dissolve an LLC and more.
This Arizona LLC Resource Center was created by Arizona LLC attorneys Richard Keyt and his son Richard C. Keyt, an attorney and former CPA. We have formed more than 10,000 Arizona LLCs and have more than 430 five-star reviews on Google, Facebook and Birdeye.
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What Do You Want to Do?
Start with the choice that best describes what you need. You can also scroll down to browse our Arizona LLC articles and frequently asked questions.
1. Form a New Arizona LLC or PLLC
Learn how Arizona LLCs work, compare our formation packages or hire us to form your LLC.
2. Change or Fix an Existing LLC
Get help with ownership changes, Operating Agreements, statutory agents, amendments and other LLC changes.
3. Research an Arizona LLC Question
Browse our Arizona LLC guides, FAQs and videos covering formation, taxation, ownership, management and asset protection.
Arizona LLC Article & FAQ Library
Arizona LLCs at a Glance
An Arizona LLC is formed by filing Articles of Organization with the Arizona Corporation Commission. Every Arizona LLC must continuously maintain an Arizona statutory agent. Arizona LLCs generally do not file annual reports with the Arizona Corporation Commission or pay an annual Arizona LLC renewal fee.
Filing the Articles of Organization creates the LLC, but that should not be the end of the process. A properly organized LLC should also address ownership, management, its Operating Agreement, federal tax classification, an EIN when needed, banking, record keeping and appropriate insurance.
Want Us to Form Your Arizona LLC?
We offer three flat-fee Arizona LLC formation packages. Every package includes attorney-supervised formation, a custom Operating Agreement and our statutory agent service for the first year.
Bronze — $497
Essential LLC Formation
- We prepare and file the Articles of Organization
- Custom Operating Agreement
- Statutory agent service for the first year
- Bank-account opening instructions
- Free attorney Q&A before and after formation
Silver — $897
Complete LLC Formation Package
- Everything in Bronze
- We obtain the EIN from the IRS
- Organizational resolutions
- Membership certificates
- Arizona LLC Operations Manual
- LLC Legal Audit and follow-up information
Gold — $1,397
Confidential LLC + Revocable Living Trust
- Everything in Silver
- Attorney-prepared revocable living trust
- Trust owns the LLC membership interest
- Designed to keep your name and home address off ACC public records
- Helps the LLC interest pass at death without probate
Compare Everything Included in the 3 Packages Hire Us to Form Your LLC
Prefer to Form the LLC Yourself?
You can form an Arizona LLC without hiring an attorney. We have written detailed guides for people who want to understand or complete the process themselves.
6-Step DIY Arizona LLC Guide
Learn how to select a name, appoint a statutory agent, file the Articles of Organization, deal with publication and prepare an Operating Agreement.
Attorney's Complete LLC Guide
A more detailed guide covering formation decisions, taxation, management and what should happen after the LLC is formed.
Before filing, also use our free Arizona LLC name availability search guide .
Services for Existing Arizona LLCs
Already have an LLC? Formation is only the beginning. Ownership, addresses, managers, Operating Agreements and other information often change during the life of a company.
Operating Agreement
An Operating Agreement establishes the members' ownership, management rights, voting rules, distributions and other important rights.
Add or Remove a Member
Properly document a new member, departing member or change in a member's ownership percentage.
Buy-Sell Agreement
Multi-member LLCs should decide in advance what happens when a member dies, divorces, becomes disabled, files bankruptcy or wants out.
Statutory Agent
Arizona LLCs must continuously maintain an Arizona statutory agent. Our statutory-agent service is $99 per year.
Amend the Articles of Organization
Arizona law requires certain changes involving members, managers, addresses and statutory agents to be reported to the Arizona Corporation Commission.
Dissolve & Terminate an LLC
Properly wind up the business, deal with assets and liabilities and file the appropriate termination document with the Arizona Corporation Commission.
Arizona LLC Article & FAQ Library
Use the sections below to find answers based on where you are in the life of your LLC. Click a subject to see the resources.
Forming an Arizona LLC
- How to Start an Arizona LLC in 2026 — 6 Easy Steps
- How to Start an LLC in Arizona — Attorney's 10-Step Guide
- Arizona LLC Formation FAQs: Costs, Taxes & Setup
- Free Arizona LLC Name Availability Search
- Arizona LLC Members, Managers & Statutory Agents Explained
- Contents & Cost of Our 3 Arizona LLC Formation Packages
Operating & Managing an Arizona LLC
LLC Ownership, Members & Buy-Sell Agreements
Arizona LLC Frequently Asked Questions
Our Arizona LLC FAQ center organizes frequently asked questions by formation, management, membership changes, property ownership and closing an LLC.
Arizona LLC Videos
Prefer video? Watch Richard Keyt and Richard C. Keyt explain Arizona LLC formation, Operating Agreements, taxes, member changes, funding and other common LLC issues.
Common Arizona LLC Questions
How much does it cost to form an Arizona LLC?
The Arizona Corporation Commission's filing fee for Articles of Organization is $50 for regular processing or $85 for expedited processing.
KEYTLaw's Arizona LLC formation packages are currently $497 for Bronze, $897 for Silver and $1,397 for Gold. See our detailed package comparison.
Does an Arizona LLC need a statutory agent?
Yes. Every Arizona LLC must continuously maintain a statutory agent in Arizona. The statutory agent receives lawsuits, government notices and other official documents for the LLC.
Does an Arizona LLC have to file an annual report?
Arizona LLCs generally do not file annual reports with the Arizona Corporation Commission and do not pay an annual ACC renewal fee merely to keep the LLC in existence.
Does an Arizona LLC need an Operating Agreement?
Arizona does not generally require an LLC to have an Operating Agreement, but operating without one can leave important ownership, voting, management, distribution and transfer issues controlled by Arizona's default statutory rules.
How is an Arizona LLC taxed?
“LLC” is a state-law entity classification, not a separate federal income-tax classification. Depending on its ownership and elections, an LLC may be treated for federal income-tax purposes as a disregarded entity, partnership, S corporation or C corporation.
Tax elections can have significant consequences. Discuss the appropriate classification with your CPA or tax adviser before making an election.
How do I prove who owns an Arizona LLC?
Ownership should be documented with a properly signed Operating Agreement and the other records relating to issuance or transfer of the membership interest. The Arizona Corporation Commission's public records should not be treated as a complete substitute for the LLC's internal ownership documents.
How do I add or remove a member?
A member change should be properly documented with the transfer documents, member approvals and changes to the Operating Agreement that are appropriate for the transaction. Arizona law also requires an amendment to the Articles of Organization in specified circumstances.
Does a multi-member LLC need a Buy-Sell Agreement?
A Buy-Sell Agreement can establish what happens to a member's ownership interest when a specified event occurs, such as death, disability, divorce, bankruptcy, retirement or another event selected by the members.
Ready to Form Your Arizona LLC?
Arizona LLC attorneys Richard Keyt and Richard C. Keyt have formed more than 10,000 Arizona LLCs and PLLCs.
Questions? Call Richard Keyt at 480-664-7478 or Richard C. Keyt at 480-664-7472. We do not charge to answer initial LLC questions.
Legal Disclaimer: This page provides general information about Arizona limited liability companies and is not legal advice for your particular circumstances. Reading this page or contacting KEYTLaw does not create an attorney-client relationship.
KEYTLaw, LLC
7373 E. Doubletree Ranch Road, Suite 135
Scottsdale, Arizona 85258
Updated September 19, 2026, by Richard Keyt, Arizona attorney
Call, email or text Richard Keyt, father
Direct phone: 480-664-7478
Email: rk@keytlaw.com
Call, email or text Richard C. Keyt, son
Direct phone: 480-664-7472
Email: rck@keytlaw.com