How to Start a Sole Proprietorship in Arizona

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Of all possible business types that can operate in the state of Arizona, a sole proprietorship is the easiest and least expensive to form. A sole proprietorship in Arizona will automatically begin when a single person, or a husband and wife, decide to go into business. Arizona sole proprietorships have far less paperwork to file in comparison to Arizona corporations or limited liability companies. In fact, sole proprietors in Arizona aren't required to file formation paperwork or pay filing fees to begin operations, as explained on the Key T Law website.

Decide if the business will be named after the owner or operate under a trade name. A sole proprietorship in Arizona will automatically be named after the owner of the business. In other instances, a sole proprietorship in Arizona may file a "doing business as," also known as a trade name. Filing a trade name allows a sole proprietorship in Arizona to use a business name other than the proprietor's personal name.

Conduct a business name search. If the sole proprietorship decides to file a trade name, a name availability check may be conducted using the Arizona Secretary of State's website. Call 602-542-3230 to conduct a name availability search by phone. The state of Arizona prohibits registered businesses in the state from sharing the same business name. Furthermore, making sure your chosen trade name is available will prevent another company from suing you for using its business name. Look through your local telephone book to determine if your chosen trade name is currently being used by another local business.

File the trade name with the Arizona Secretary of State's office. Download the trade name registration form from the Arizona Secretary of State website. In other instances, a trade name registration form may be requested in person at either the Phoenix or Tucson office. Call 602-542-6187 to have a trade name registration form sent in the mail. Provide information such as the owner's name and address, as well as the length of time the proposed trade name has been in use. As of 2010, it costs $10 to file a trade name with the Arizona Secretary of State. Submit the completed trade name registration form in person at the Phoenix or Tucson office. Mail submissions should be sent to 1700 W. Washington St., 7th Floor Phoenix, Arizona 85007.

Apply for licenses and permits. Sole proprietorships in Arizona must obtain a business license from the city or county clerk's office where the company operates. Other licenses and permits needed by a sole proprietorship in Arizona will vary depending on the business type. For example, a sole proprietor in Arizona that provides barber services must obtain the appropriate occupational license from the state. Arizona sole proprietors that sell goods must obtain a sales and use tax permit from the Arizona Department of Revenue. Contact the city or county clerk's office where the Arizona sole proprietorship is located to determine the local licenses and permits needed to legally operate the business.

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