The “why’s” and “how’s” of Arizona Corporations

Establishing a corporation is a significant step for any business owner who wants to build lasting stability and protection. Corporations offer a trusted structure that separates personal and business liability while supporting growth, credibility, and long-term planning. This overview outlines the key benefits of forming a corporation in Arizona, explains the steps involved, and highlights how Galbut Beabeau, P.C. can guide you through the process with experience, precision, and care.

Here is what you need to know.

Benefits of a Corporation
A corporation protects you from personal liability by being a separate legal entity. This means, in most instances, your personal assets, like your vehicle, house, and savings accounts, won't be at risk in the event your corporation faces bankruptcy or lawsuits. Corporations are taxed at the corporate level, which means all profits are “double taxed” by being taxed at the corporate level and then taxed at the individual level when the Shareholders receive a dividend. Please note, Galbut Beabeau, P.C. does not offer tax advice, and a tax professional should be consulted for all tax questions.  

How to form your Corporation
Forming Corporation has many components. Galbut Beabeau, P.C. has years of experience forming all types of corporations and is happy to guide you through this process at an initial consultation.

Ownership and Management
Corporations are owned by the “Shareholders.” Shareholders then elect the Board of Directors to oversee the corporation’s management. The corporation is managed by the Officers. The Officers oversee the corporation’s day-to-day activities. Determining the Board of Directors and Officers are important decisions that Galbut Beabeau, P.C. is qualified to assist with.

The Corporation’s Stat Agent
The Stat Agent is the designated person or entity, who is physically located within Arizona, that is authorized on behalf of the corporation to receive important legal and government documents. Galbut Beabeau, P.C. offers to serve as Stat Agent for all clients at no additional cost.

Articles of Incorporation
To form your corporation, you must completely and accurately file the Articles of Incorporation with the Arizona Corporation Commission (“ACC”), as this will become part of the public record. You must select a name, include your Stat Agent information, provide the names and addresses of the Director’s and Officers, among other corporation specific information. If any of this information is incomplete or inaccurate, the ACC will reject your filing. Galbut Beabeau, P.C. can assist you with filing your Articles of Incorporation so that your entity is properly formed.

Bylaws
The Bylaws governs (i) the relationship among the Shareholders and the corporation, (ii) the rights and duties of Directors and Officers, (iii) the activities and affairs of the company and the conduct of those activities and affairs, and (iv) many other important provisions governing the corporation. Drafting Bylaws that accurately reflect your corporation’s needs is essential to the corporation’s well-being, and Galbut Beabeau, P.C. is able to draft Bylaws personalized for your corporation.

Corporate Formalities
Following formation, it is important to abide by “corporate formalities.” Corporate formalities include many items, but simply, they are the actions needed to be taken in order for the corporation to maintain its separate legal entity status. Failure to abide by the corporate formalities puts the Officers, Directors, and even the Shareholders at risk of being personally liable for the corporation’s actions. Examples of corporate formalities include maintaining a business bank account, complying with required corporate filings, and maintaining accurate books and records. Following formation, Galbut Beabeau, P.C. is able to serve as your outside counsel and assist with maintaining corporate formalities.

Please note: This is only a high level summary and not to be viewed as an all encompassing guide to corporations. For additional assistance or questions regarding corporations, please contact Galbut Beabeau, P.C. for an initial consultation. Galbut Beabeau, P.C. does not offer any tax advice. You should consult your tax professional regarding any tax implications or required tax filings.

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