If you run a business in Arizona, you might need an Arizona business license, permit, or certificate of some kind to operate. And you might even need more than one of these documents, depending on the work that you do. If that’s the case, you aren’t alone. Lots of freelancers have to apply for business licenses or permits from local, state, and federal governments.
What are the types of business licenses in Arizona and the requirements associated with them? This article should help clear up some of your questions.
Federal licenses and permits
For most small businesses, the federal government doesn’t require licenses or permits. But there are certain activities that are regulated by federal agencies and those activities might require a federal license or permit. Business activities that are regulated by federal agencies and may require a license or permit are:
- Alcoholic beverages
- Firearms, ammunition, and explosives
- Fish and wildlife
- Commercial fisheries
- Maritime transportation
- Mining and drilling
- Nuclear energy
- Radio and television broadcasting
- Transportation and logistics
If you’re involved in any federally regulated activity, the next step is to contact the federal agency that’s in charge of that activity. Find out what its requirements are and then follow through so that you can conduct business legally.
For example, if your business is involved with aviation, you’d be regulated by the Federal Aviation Administration, and that would be the first place to go for more information.
Tip: You can see a list of all the federally licensed activities, along with links to more information, by visiting this website maintained by the U.S. Small Business Administration.
AZ business license: State requirements
There are a few states where all businesses need to obtain state business licenses, as well as any local licenses required. Those states are Alabama, Alaska, Delaware, Ohio, Nevada, and Washington State.
Rejoice! There are no Arizona state business license requirements.
However, just like all other states, it does have license and certification requirements for various business activities and occupations that require extensive training or expose consumers to potential hazards. Those include:
- Medical professionals
- Building contractors and other construction-related occupations
- Barbers and cosmetologists
- Architects and engineers
- Real estate brokers and salespersons, and
- Private investigators and other security services
For example, if you want to work as a real estate broker in Arizona, you’ll need to get a license from the Arizona Department of Real Estate. You need to check with the appropriate Arizona state regulatory agency to see if you need to get a state license or permit. A comprehensive list of Arizona state agencies can be found here.
The process for getting your Arizona state business license will vary based on your occupation. In some cases, you’ll need to meet specific educational or training requirements or need experience in the field. You might have to take and pass a written exam before getting your license. And — as you might have guessed — there is a license fee that you’ll need to pay.
Do you really need to get your Arizona state business license?
If the state discovers that you’re working in an occupation without a required license, a host of bad things can happen.
First, you’ll undoubtedly be ordered to stop doing business. You might also be fined and, depending on your occupation, failure to obtain a license might even constitute a crime.
Plus the Arizona business license search allows consumers to verify your license through an online search.
So going through the proper steps to get your Arizona business license before you start conducting business is always a wise move.
Getting a local business license in Arizona
If you aren’t required to get a federal license or a state license. You might think that you’re in the clear. Think again.
There’s actually a good chance that you’ll need to get a local Arizona business license. Each Arizona city and county establishes its own licensing requirements and procedures.
Keep in mind, though, that most counties and cities in the state require business licenses or permits for all businesses, including one-person, home-based operations.
How to get a business license in AZ
The good news is that getting your local Arizona business license is pretty easy. Basically, your city or county has a website that explains its licensing requirements.
Once you know where to go, you might be able to apply for your license online. Otherwise, you can download an application and email or mail it to the appropriate party. If you’re conducting business within a city’s limits, check with your city government to determine its licensing requirements. You can find links to Arizona city and town offices here.
If you’re in an unincorporated area, check with the county government. You can find links to Arizona county offices here. And keep in mind that if you have an office in more than one city or county, you might need to get a license for each one.
How much is an Arizona business license?
Usually, you have to pay a fee to get a local license in Arizona.
Fees vary by locality, and could range from as low as $15 to as high as a few hundred dollars. Fees can also be based on your projected gross revenue (for example, 10 cents per $1,000 of projected revenue).
Arizona business license application: What to expect
You’ll likely be asked for the following information when you apply for your local business license:
- Social Security Number or Federal Employment Identification Number
- Description of your business activities
- Legal business name and any assumed name or “dba”
- Business start date
- Number of employees and your expected annual sales
- Business address and contact information
- Business owner’s contact information
- Business sales tax number, if any
After submitting your application, you’ll usually receive your license or certificate with a business license number within a few weeks in the mail. Once you have it in your possession, you may be required to post it at your place of business.
Good to know: You’re required to renew your Arizona business license periodically, and that might involve an additional fee. Usually, a renewal is required every one to three years, so be sure to mark your calendar so you don’t forget and get hit with a late fee.
Is a local license really necessary in Arizona?
Yes! It’s true that a lot of self-employed individuals, particularly those who work from home, never get a local business license.
But if your local government finds out that you’re running an unlicensed business, you might be fined, and could even be prevented from doing business until you obtain the license.
So it’s always best to avoid problems by researching the license(s) you need and applying for them so you can do business without having to worry.
An easier way to get your Arizona business license
Getting an Arizona business license is a necessary part of doing business in Arizona. Because it can become challenging to keep up with all of these requirements, Hyke is here to help you.
After you join Hyke, we’ll sort through all of the important details regarding what licenses you need to get. Plus we’ll remind you when it’s time to renew your licenses so you never skip and beat and can keep running your business legally.
Stephen has dedicated his career as an attorney and author to writing useful, authoritative and recognized guides on taxes and business law for small businesses, entrepreneurs, independent contractors, and freelancers. He is the author of over 20 books and hundreds of articles and has been quoted in The New York Times, Wall Street Journal, Chicago Tribune, and many other publications. Among his books are Deduct It! Lower Your Small Business Taxes, Working with Independent Contractors, and Working for Yourself: Law and Taxes for Independent Contractors, Freelancers & Consultants.