How do I apply or register a business with Arizona?
You may obtain the Arizona Joint Tax Application (JT1) in person at one of our office locations or you may obtain it through our web site. (Forms and Instructions)
Note: When applying in person only the owner or principal officers of the business who have signed the application can receive the license. Proof of identity may be required. Otherwise the license will be mailed to the applicant unless a Power of Attorney is provided. (Power of Attorney Forms)
How do I cancel or deactivate my business license?
To cancel or deactivate a business license, follow only one of the procedures below:
Return the license to the Department of Revenue with the word “CANCEL” written across the front of it.
Submit a written request to deactivate or suspend the license. Include the license number and the name of the business.
Mail the license or deactivation request to:
License and Registration
Arizona Department of Revenue
1600 W. Monroe
Phoenix , AZ 85038-9032
Or, you can visit one of our office locations where a customer service representative can assist in de-activating a license. Arizona Department of Revenue locations are located at:
I only do business for special events in Arizona, am I required to obtain a license?
A seasonal license application can be obtained for any period from one to eight months. There is a short version of the license application available that is specifically for event licensing. This is intended for use by vendors at special events such as Fairs, Shows, Swap Meets, etc. The State fee is $12 no matter how many special events you attend. However a separate city license fee is required for each city unless you are currently licensed for the city in which an event will be held. (License Application – short version )
When is a license fee assessed?
The fee for the state transaction privilege tax license is $12 per location plus any applicable city license fees collected by the Department of Revenue.
My license was cancelled, can I have it reinstated?
Yes. If a license has been cancelled by the Department of Revenue in error, the Department of Revenue will reinstate and print a new license at no charge. If the license holder cancelled the license, the same number may be reissued, but a new license fee and appropriate city license fees will be assessed.
Transaction privilege tax licenses are effective indefinitely. It is not necessary to "renew" a transaction privilege tax license. (Note: A change of name or location would require a new license with applicable fees.)
If only one spouse owns the business, do both spouses have to sign the license application?
No. Spouses are only required to sign if they are both listed as owners. Please note that Arizona is a community property state which may impact the liability or ownership interest of both spouses regardless of the form of business ownership.
How do I change my business location or mailing address?
Complete the Transaction Privilege and Use Tax/ Withholding License Update form and mail it to: Department of Revenue at 1600 West Monroe , Phoenix , AZ , 85007 , Attention: License and Registration.
Am I required to obtain a new license if the name of my business has changed?
You must notify the Department of Revenue in writing and pay any applicable fees. (License Update form) Note: a change in name frequently indicates a change in ownership, thus requiring a new license.
Ownership of the business has changed; can we keep the same license number?
The transaction privilege tax license is not transferable. Anytime the ownership status changes, a new license number is required. Other situations where a new license may be required are: a sole proprietor becomes a corporation or partnership, business location changes, business locations added, business name changes. Note: A new license is not necessary if the mailing address changes or if there are changes to the corporate officers.
Am I required to have a license for each location?
Each separate physical location must have a license for display. If the ownership is the same, the locations can be consolidated under one license number to allow the taxpayer to file a single return. If the taxpayer does not wish to consolidate, they can fill out separate applications and have different license numbers issued for each location and must file accordingly.
My business never opened. Do I need to cancel the license?
If you do not intend to open the business then you must cancel the license and follow step one. If you still intend to open the business but at a later date, follow step two.
Return the license to the Department of Revenue with the word “CANCEL” written across the front of it.
Submit a written request to deactivate or suspend the license. Include the license number and the name of the business.
Mail the license or deactivation request to:
License and Registration
Arizona Department of Revenue
1600 W. Monroe
Phoenix , AZ 85038-9032
Or, you can visit one of our office locations where a customer service representative can assist in de-activating a license. Arizona Department of Revenue locations are located at:
The Department of Revenue will print a new copy of the license upon request. The fee for a copy is $12 plus any additional city fee.
My business is run out of my home. Am I still required to obtain a license?
Yes, you must apply and obtain a license. You may use you home address as the business address on the application. Note: It is the responsibility of the business owner to research the legality of operating a business in a home and to comply with county and city zoning requirements.
What signatures are required on a license application?
Only individuals legally responsible for the business may sign the application. Agents or representatives may not sign the application. Here are examples of signature requirements:
Sole Proprietor; Owner(s) of the business.
Partnership; A minimum of one partner.
Corporation, Organization, LLC, Sub Chapter S or Trust; A minimum of one financial corporate officers.
Am I required to register my Corporation with the Arizona Corporation Commission?
Yes. Corporations must also file with the Arizona Corporation Commission. The Corporation Commission may be contacted at www.cc.state.az.us or by phone at 602-542-4251.
Is a business required to have an EIN (Employer Identification Number)?
Corporations, partnerships, and all employers must have an Employee Identification Number (also referred to as FEIN). The EIN may only be obtained through the IRS (Internal Revenue Service). Their web site www.irs.gov or you can contact the IRS by phone at (800) 829-1040.
As a sole proprietorship can I use my SSN (Social Security Number) as my EIN?
Yes, only if you are a sole proprietor without employees.
What are non-program cities?
Some cities in Arizona license and collect their privilege tax independently from the State. If business is conducted in one of these cities, a separate city privilege tax license is necessary. In addition, you must report and pay the city portion of the transaction privilege tax directly to the city. The non-program cities are listed below, you must contact them directly for licensing.
You can visit one of our service centers and complete the JT1 (joint tax application). It will take approximately 20 minutes to complete the application and receive your license. If you mail your completed JT1, please allow 10 to 14 business days to receive the license.
When is a sale exempt from tax when goods are used for resale purposes?
If a vendor or seller has a "good faith" belief that the purchaser will be reselling the goods or using the goods for an exempt purpose, the sale may be exempt from tax.
The purchaser should present the vendor with a completed Exemption Resale Certificate (Form 5000 or 5000A). A vendor that accepts a certificate in good faith will be relieved of the burden of proof and the purchaser may be required to establish the accuracy of the claimed exemption as provided in Arizona Revised Statute 42-5022.
Are auctioneers required to obtain a transaction privilege tax license?
Yes. Sales by auctioneers whether or not the property is owned by them are taxable as retail sales.
Are pictures taken by and printed by photographers taxable?
All of a photographer’s activities are taxable under the retail classification. “Photographer” means a person who engages in the business of photography. “Photography” means the operation of taking, developing, processing, or printing pictures, prints, or images on or from film, video, or other similar media. Gross receipts derived from the sales of photography by a photographer are taxable under the retail classification.
Is an article incorporated into a fabricated or manufactured product taxable?
No. This is considered to be a sale for resale and is therefore exempt. In order for the exemption to apply, the materials must actually become part of the finished product. Supplies which are consumed in the manufacturing process do not qualify for the exemption.
The sale of tools, supplies, and other articles to be used or consumed by a person in the operation of their business and not for resale, are taxable as retail sales.
Is computer hardware taxable?
Yes. Computer hardware is considered to be goods sold to the consumer, or end user and therefore subject to transaction privilege tax under the retail classification.
Is computer software taxable?
Yes, it is usually subject to the tax. Software is exempt only if the software is specifically designed for the use of only one person or business and will not be used by anyone else. If the software is written so that many people or companies can use the program, then the software is taxable.
Yes. Diesel fuel for off-road use is subject to transaction privilege tax which is paid to Arizona Department of Revenue. Diesel fuel for on-road use is taxable by the Department of Transportation.
Is a swimming pool cleaning service taxable?
Chemicals are used by the cleaning service to clean their customer’s pool is not taxable. However, if the pool cleaning service sells the product to it’s customers (a bucket of chlorine for example), the transaction then become taxable as retail sales.
Are sales to State and City governments subject to transaction privilege tax?
Yes. Sales made to the State, Cities, Counties or other political subdivisions are taxable at the full rate.
Retail sales to U.S. Government are taxable at one-half the regular tax rate. Sales of products directly to the U.S. Government by a manufacturer, modifier, assembler or repairer of such products are not taxable.
Is an order called in by an out-of-state purchaser and delivered out-of-state, subject to Arizona transaction privilege tax?
Sales in interstate commerce are exempt from tax if sufficient documentation is maintained by the seller to show the order was shipped out of state.
If a non-resident purchases merchandise in Arizona , is the sale exempt from transaction privilege tax?
If the non-resident customer picks up the merchandise in Arizona , the sale is subject to transaction privilege tax. Sales are exempt only if the purchaser has proof of out-of-state residence and the merchandise is shipped out of State for use out of State. The appropriate exemption certificates must be maintained by the Arizona retailer.
Are sales to Native Americans taxable?
Sales made to Native Americans by non-Indian vendors located off the reservation are generally subject to tax. Sales to a tribe, or an enrolled member of the tribe, are not subject to transaction privilege or related county excise taxes if the order originates from that tribe’s reservation, delivery is made to that tribe’s reservation and payment is received from the reservation. Sales that are not subject to the State tax or related county excise tax, should be documented through the use of the appropriate certificate or other documentation.
The purpose of the certificate is to document tax exempt sales to qualified purchasers. It is to be filled out completely by the purchaser and furnished to the vendor. (Click here for Exemption Certificate Forms)
How is a trade-in taxed?
If you take a trade-in for partial payment on a retail sale, you owe transaction privilege tax on the difference between the selling price and the trade-in amount. The subsequent sale of the item taken in trade is subject to tax.
Charges for installation labor on items that are not to be attached to real property are exempt from tax. Charges for retail labor must be clearly listed separately on invoices and records. Otherwise, you will owe tax on the total invoice where parts and labor are not separately stated.
Is the sale and installation of property that is permanently attached to real property taxable?
Yes. This would be taxable under the prime contracting classification. (Click here for Publication 603, Contracting Activities)
When included in the retail sales price, a shipping charge from the manufacturer or wholesaler to the retailer is considered a cost of doing business and is included in the taxable proceeds from the sale. If goods are shipped directly from the manufacturer or wholesaler to the purchaser, a charge for freight may be excluded from taxable gross proceeds if separately stated. Actual freight charged by the retailer to deliver goods to the purchaser is not taxable under the retail classification if separately stated on the invoice.
Is food sold for use at home taxable?
Food sold for home consumption is exempt from transaction privilege tax when sold by a qualified retailer. For more information on tax exempt food, see Publication 575, Tax Exempt Food.
Is personal property purchased by a non-profit, charitable organization taxable?
Generally sales of tangible personal property to nonprofit organizations are subject to tax. If the tangible personal property is to be resold in the ordinary course of the Nonprofit’s business, the sale of the tangible personal property is not subject to tax. Also, if the tangible personal property is purchased by a non-profit, charitable organization that qualifies under 501(c)(3) of the United States Internal Revenue Code and the property is used in programs for mentally or physically handicapped persons and the programs are exclusively for training, job placement, rehabilitation, or testing the sale is not subject to tax. See our Non-Profit Organization Publication 501.
Use tax is levied upon retail purchases from out-of-state vendors and is generally noted as “sales” tax on the vendor’s invoice. If the out-of-state vendor does not specifically charge the use (or “sales”) tax, then the Arizona purchaser is responsible for remitting the tax to the ADOR. The purchaser may obtain a license to remit the use tax on retail purchases that were not taxed. If the sales tax has been paid in the State of purchase at a rate equal or greater than the Arizona use tax rate, the Arizona purchaser has no further liability. See Use Tax Publication 610
Do I still need a license for Use Tax?
Arizona purchasers regularly buying from out-of-state retailers who are not registered to collect the use tax, must register with the Department for use tax purposes.
What is the Use Tax rate?
The State Use tax rate is equal to the State Transaction Privilege tax rate. Click here for tax rates.
Is a newly purchased boat from out-of-state taxable?
Yes. Use tax applies only if the water craft is purchased from a dealer (not when purchased from an individual and the watercraft has already been registered in another State.)
How do I report use tax?
You must be registered with ADOR to report use tax. If you are already registered and you have a Transaction Privilege Tax (TPT) license, you do not need a separate license for Use tax. You can report use tax using the same form for your TPT license. If you are reporting on a one time basis, you may submit the tax with a cover letter.
