Key Takeaways

  • An EIN (Employer Identification Number) is required for most Arizona businesses and is issued by the IRS at no cost.
  • Arizona businesses often need both a federal EIN and an Arizona state tax ID number.
  • You can apply for an EIN online, by mail, or by fax. International applicants can apply by phone.
  • Arizona requires a state tax ID for businesses that hire employees, collect sales tax, or owe state-level taxes.
  • Registering for an EIN should be done after your business entity (LLC or corporation) is approved by the Arizona Corporation Commission.
  • The Arizona Joint Tax Application can be used to apply for multiple state licenses at once.
  • Only one “responsible party” can be listed on the EIN application.

An Arizona business tax ID through both federal and state governments is necessary for new business owners in the state of Arizona. A federal tax ID, or EIN, can easily be applied for online through the IRS website. In this state, all businesses need to also have a state business license or state tax ID. This applies to all businesses, whether they are traditional, home-based, or online. There may also be additional requirements for local permits or licenses specific to your business.

If you're looking for the perfect place to start your business, Arizona is very favorable to businesses and is a great state to consider. Location is a very important factor to consider in business, and you want to choose a place that will give you a good chance of success. There are plenty of skilled workers available in the state. Taxation is also favorable to businesses in Arizona, which will allow you to worry more about getting your business set up properly.

Arizona State Tax ID Number

Obtaining an Arizona state tax ID number is not difficult, but it does require a series of steps to complete the process.

  • If the business is a partnership, LLC, or corporation, the business needs to be registered with the Arizona Department of Revenue. This can be done through forms available online from the Arizona DOR Corporate Filing Forms website. If the business is a sole proprietorship, it is not a requirement for it to be registered.
  • You must have a federal tax ID number, or EIN, in order to get an Arizona state tax ID number. You can go to a local Internal Revenue Service to apply or call the IRS directly. The exception to this is if you are a sole proprietor with no employees. In this situation, the owner of the sole proprietor can use their Social Security number.
  • Using the Department of Revenue Arizona Joint Tax Application, which is available online, you can apply for several licenses and tax registrations. This includes transaction privilege and state unemployment tax.
  • Once the form is complete, print, sign, and submit the signature card. You can submit the signature card and filing fee by mailing it to the address on the card or by submitting it in person. You'll be granted your state tax ID number and licenses once the application is processed.

When Arizona Businesses Need a State Tax ID

A state tax ID number, also referred to as a Transaction Privilege Tax (TPT) license number, is typically required if your business does any of the following:

  • Hires employees within Arizona.
  • Sells goods or services subject to sales tax.
  • Operates as a partnership, corporation, or LLC.
  • Owes excise or withholding taxes to the Arizona Department of Revenue (ADOR).

The Arizona Joint Tax Application allows you to register for multiple taxes and licenses simultaneously, such as:

  • Transaction Privilege Tax (TPT)
  • Withholding Tax
  • Unemployment Insurance Tax

If you plan to operate in multiple cities, be aware that Arizona’s TPT system is centralized, but you must indicate each city where business will be conducted. Always ensure compliance with local city licensing requirements in addition to the state registration.

Federal Tax ID Number

The federal tax ID number, or EIN, is what the IRS uses to identify your business for tax purposes — just like how a Social Security number identifies an individual. Even though the name is Employer Identification Number, it is not a requirement that you have employees. Using the EIN, you can open a separate business banking account, handle payroll if you have any employees, and apply for certain business licenses.

When applying for an EIN, always wait for your LLC to be approved by the Arizona Corporation Commission first. If you don't wait and the LLC is rejected but the EIN is approved, you will have an EIN attached to an LLC that doesn't actually exist. In the event that this occurs, you can always cancel the EIN and reapply. There is no cost associated with applying for an EIN. In the past, you used to be able to apply for an EIN over the phone, but this is no longer an available option.

There is a specific person, the EIN responsible person, that goes on file with the IRS when applying for the EIN. For an Arizona LLC with just a single owner, this owner will be the responsible party. If there are multiple members in the LLC, then one of the members will have to be the EIN responsible party. Only one person can have this designation. The rest of the members' information is submitted when the tax filings are returned.

How to Apply for an EIN in Arizona

There are several ways to apply for an EIN number in AZ, depending on your preference and eligibility:

1. Apply Online:

  • The IRS offers an online EIN application, available Monday to Friday from 7 a.m. to 10 p.m. EST.
  • The online application is the fastest method and must be completed in one session.
  • Only businesses with a U.S. address and a valid Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) can use this method.

2. Apply by Fax or Mail:

  • You can download and complete IRS Form SS-4.
  • Fax it to the appropriate IRS number or mail it to the IRS, depending on your location.
  • Processing typically takes 4 business days for faxed applications and up to 4 weeks by mail.

3. Apply by Phone (International Applicants Only):

  • International businesses or U.S. citizens without a SSN or ITIN can call the IRS at 267-941-1099 to apply for an EIN.

Important: Always wait until your Arizona LLC or corporation is approved before applying for an EIN. If your business entity is rejected and you've already received an EIN, you’ll need to cancel it and reapply.

Choosing the Responsible Party for EIN Applications

The IRS requires you to designate a "responsible party" on the EIN application. This is the individual who ultimately owns or controls the business. For most small businesses, this is one of the owners or members.

Key requirements:

  • Only one responsible party can be listed.
  • This person must have a valid SSN or ITIN unless the entity is foreign-owned.
  • Their name and tax ID will be tied to the EIN in IRS records.

Correcting or Cancelling an EIN

If you receive an EIN but decide not to use it—perhaps because the business entity was not approved or you changed your structure—you must formally cancel it.

To cancel an EIN:

  • Send a letter to the IRS that includes the business name, EIN, address, and reason for cancellation.
  • Include the original EIN confirmation letter if available.
  • Mail the request to:
    Internal Revenue Service
    Cincinnati, OH 45999

Keep in mind, EINs never expire, and once issued, they are never reused or reassigned. However, you can apply for a new EIN if your business undergoes a major structural change.

EIN Scams and Common Mistakes to Avoid

Arizona business owners should be cautious of scams and misinformation when applying for an EIN number in AZ. Common pitfalls include:

  • Paying for EINs: Applying for an EIN through the IRS is always free. Avoid third-party websites that charge fees.
  • Using an EIN before LLC approval: This can result in having an EIN tied to an invalid entity.
  • Choosing the wrong business entity: Your EIN application must match your legal business structure exactly—LLC, S Corporation, Partnership, etc.
  • Incorrect responsible party info: Listing the wrong individual may complicate future filings or EIN verification.

When in doubt, consulting a qualified business attorney can help you navigate these steps correctly.

Frequently Asked Questions

  1. What is an EIN number in Arizona used for?
    An EIN is used to identify your business for federal tax purposes. It’s required for hiring employees, opening business bank accounts, and filing taxes.
  2. How do I get an EIN number in AZ for free?
    Apply directly through the IRS website, by fax, or by mail. The IRS never charges a fee for issuing EINs.
  3. Do sole proprietors in Arizona need an EIN?
    Only if they hire employees, form retirement plans, or file specific tax returns. Otherwise, a Social Security Number may suffice.
  4. Can I use my EIN before my LLC is approved in Arizona?
    No. You should wait until the Arizona Corporation Commission approves your LLC to avoid complications with mismatched records.
  5. Is an EIN the same as a state tax ID in Arizona?
    No. The EIN is issued by the IRS for federal purposes. The Arizona state tax ID is issued by the Arizona Department of Revenue for state taxes.

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