Glendale

A Glendale Business License is required for any person or business with a physical business location in Glendale city limits. In addition, depending on your type of business, special regulatory licenses may also be required. (24)

Contact: City of Glendale, Licensing Office, Licensing & Sales Tax, 623.930.3190 

The City of Glendale imposes a transaction privilege (sales)/use tax on the gross receipts from various types of business activities. If your business activity is subject to city transaction privilege (sales)/use tax, you will need to obtain the state transaction privilege tax (TPT) license from the Arizona Department of Revenue in addition to any city requirements. See Engaging in Activities Subject to Transaction Privilege (Sales)/Use Tax. (24)

Additional Information:

The Glendale IDEA Center (Glendale Innovation Development and Entrepreneurial Assistance Center) is a space where business people, entrepreneurs, innovators and networkers can come together to share ideas, tips, and skills, learn more about starting and growing a business, form partnerships or just make connections. (24)

Peoria

The City of Peoria requires that all persons conducting business in Peoria unless exempt must first obtain their city license. This includes businesses within the Peoria city limits, or those outside the limits who conduct business or perform services within Peoria. In addition, businesses may be subject to regulatory licenses and permits. (24)  

Contact:
City of Peoria, Sales Tax and License
8401 W. Monroe Street, Peoria, AZ 85345
623.773.7160

The City of Peoria imposes a transaction privilege (sales)/use tax on the gross receipts from various types of business activities. If your business activity is subject to city transaction privilege (sales)/use tax, you will need to obtain the state transaction privilege tax (TPT) license from the Arizona Department of Revenue in addition to any city requirements. See Engaging in Activities Subject to Transaction Privilege (Sales)/Use Tax. (24)

Phoenix

To determine if the location of your proposed business has the correct zoning, contact the City of Phoenix Zoning Division. (24)

Contact: City of Phoenix, Planning and Development Department, 602.262.7131, option 6

The City of Phoenix does not have or issue a general business license. Only certain activities are regulated and require a license or require a recommendation/approval from the City. 

Examples of regulated activities include: amusements (Coin Operated Games, Concessionaires, Game Centers, Pool Halls, Rides, Teenage Dance Halls), auctions, curb painters, escort bureaus & escorts, massage establishments & managers, sexually oriented businesses & performers, vending (mobile, sidewalk, street, secondhand dealers, swap meet lots, scrap metal dealers, downtown sidewalk), liquor, bingo, off-track betting, and topless bars. (24)

Contact: City of Phoenix City Clerk Department - License Services, Liquor and Regulated Business Licensing Information, 602.262.4638

The City of Phoenix imposes a transaction privilege tax on the gross receipts from various types of business activities. If your business activity is subject to city transaction privilege (sales)/use tax, you will need to obtain the state transaction privilege tax (TPT) license from the Arizona Department of Revenue in addition to any city requirements. See Engaging in Activities Subject to Transaction Privilege (Sales)/Use Tax. (24)

Scottsdale

All businesses located in the City of Scottsdale require a Business Registration license - Service or Merchant, and may require an additional Regulatory license. (24)

Contact:
City of Scottsdale, Business Services
7447 E. Indian School Road, Ste. 110, Scottsdale, AZ 85251
480.312.2400

The City of Scottsdale imposes a transaction privilege (sales)/use tax on the gross receipts from various types of business activities. If your business activity is subject to city transaction privilege (sales)/use tax, you will need to obtain the state transaction privilege tax (TPT) license from the Arizona Department of Revenue in addition to any city requirements. See Engaging in Activities Subject to Transaction Privilege (Sales)/Use Tax. (24)

Cleaning Service/Janitorial Maintenance

If you plan to perform direct customer service activities such as cleaning or janitorial maintenance, see Local Compliance section below to learn about possible license requirements. (22)

Having Full-Time or Part-Time Employees

As a business owner, when another person performs work for you, you must first correctly classify that person as an independent contractor or employee before you can know how to treat payments that you make to that person. 

If you plan to hire one or more employees within Arizona, you will be subject to both federal and state requirements. Below are some resources to help connect you to the information you need. You may also wish to consult with your accountant or attorney for assistance.

Federal

• As an employer, you must withhold employment taxes from your employee’s wages. In addition, you need an Employer Identification Number (EIN). (24) 
    
  Apply online: Employer Identification Number (EIN)
  Download: Application for Employer Identification Number (SS-4)
    
  Contact:
  Internal Revenue Service (IRS): Employer ID Numbers
  Attn: EIN Operation, Cincinnati, OH 45999 
  Phone:  800.829.4933 (7am -10pm local time, Monday-Friday) 
    
• You generally must withhold federal income tax from your employee's wages. To figure how much to withhold from each wage payment, use the employee’s W-4 form and the methods described in the IRS Publication 15, (Circular E), Employer's Tax Guide and Publication 15-A Employer's Supplemental Tax Guide. (24) 
    
  Download: Form W-4, Employee’s Withholding Allowance Certificate   
   
• Social security and Medicare taxes pay for benefits that workers and families receive under the Federal Insurance Contributions Act (FICA). Social security tax pays for benefits under the old-age, survivors, and disability insurance part of FICA. Medicare tax pays for benefits under the hospital insurance part of FICA. You withhold part of these taxes from your employee’s wages and you pay a matching amount yourself. All employees must have a social security card. 
    
  As an employer, it is now your responsibility to report payroll information annually to the Social Security Administration and to your employees. Visit Social Security Administration (SSA) Business Services Online information for large and small business/tax filers.    
    
  Social Security Administration: Employer W-2 Filing Instructions & Information   
  Social Security Administration: Electronic Fact Sheet: If You Are Self-Employed 
    
  Note: Self-employment tax applies to self-employed workers and is their contribution to social security. It is generally paid by sole proprietors, self-employed farmers and members of a partnership. Explanatory publications are available online at the Internal Revenue Service - Small Business and Self-Employed Tax Center.
   
• The federal unemployment tax is part of the federal and state program under the Federal Unemployment Tax Act (FUTA) that pays unemployment compensation to workers who lose their jobs. You report and pay FUTA tax separately from social security and Medicare taxes and withheld income tax. You pay FUTA tax only from your own funds. Employees do not pay this tax or have it withheld from their pay. FUTA taxes are reported on Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return to IRS. 
    
  Internal Revenue Service - Employment Tax Forms 
  Download: Form 940, Employer’s Annual Federal Unemployment (FUTA) Tax Return
   
• All U.S. employers must verify the identity and employment authorization of each individual they hire for employment in the United States through completion of Form I-9, Employment Eligibility Verification. The Handbook for Employers M-274 provides guidance for completing Form I-9 (Employment Eligibility Verification Form). (24) 
   
  Contact: U.S. Citizenship and Immigration Services (USCIS), Form I-9 Contact Center, I-9 Central, 888.464.4218 
  
  

State

• Employers paying wages to employees for services performed in the state must register to remit withholding tax. The Arizona Joint Tax Application is used to register for your employer withholding/unemployment insurance license. The application is called "Joint" because it is used by both the Departments of Revenue and Economic Security. 
    
  Register Online: Businesses > Enroll to File and Pay Online (for Employer Withholding and Unemployment Insurance License)
  Download Form: Joint Tax Application for a TPT License (JT-1)  
   
  Contact:
  Arizona Department of Revenue: Arizona Withholding Tax
  602.255.3381 or toll-free 800.843.7196 (from area codes 520 and 928) 
   
  Contact:
  Arizona Department of Economic Security - Questions Regarding Unemployment Tax 
  Arizona Department of Economic Security (DES): Unemployment - Employer
  Unemployment Insurance Tax (UIT) - Frequently Asked Questions
  602.771.6602 
   
• Under Arizona law, it is mandatory for employers to secure workers’ compensation insurance for their employees. Workers’ compensation is a “no fault” system in which an injured employee is entitled to receive benefits for an industrial injury, no matter who caused the job-related accident. Employers are required to bear the entire cost of workers' compensation insurance.
    
  Companies may choose to insure their employees by insuring with an authorized carrier of the state, or by qualifying as a self-insurer under the rules and regulations of the Industrial Commission of Arizona. (24)
  
  The Arizona Department of Insurance and Financial Institutions (DIFI) can verify if a company is licensed and authorized to sell workers’ compensation insurance in the State of Arizona.
  
  Contact: Arizona Department of Insurance and Financial Institutions (DIFI), Consumer Affairs Division, 602.364.2499 or 800.325.2548 
  
  The Industrial Commission of Arizona administers the Workers' Compensation Law. (24)
    
  Contact:
  Industrial Commission of Arizona, Claims Division: What Is Workers' Compensation and How Does It Work? 
  Phoenix area 602.542.4661 or Tucson area 520.628.5181 
    
• On October 1, 1998, the Arizona New Hire Reporting Program from the Arizona Department of Economic Security, Division of Child Support Enforcement was established. State and federal law requires all employers to report each new and rehired employee to the State Directory of New Hires within 20 days of their hire date.   
    
  Contact: Arizona New Hire Reporting Center, 888.282.2064
   
• Arizona law requires employers in Arizona to use the “E-Verify” system (a free Web-based service offered by the federal Department of Homeland Security) to verify the employment authorization of all new employees hired after December 31, 2007.  
    
  E-Verify: Enroll in the Program
    
  The Arizona Attorney General's Office web site provides basic information about the Legal Arizona Workers Act, sometimes called the “Employer Sanctions Law,” as amended. 

Independent Contractors

As a business owner, when another person performs work for you, you must first correctly classify that person as an independent contractor or employee before you can know how to treat payments that you make to that person. 

The general rule is that an individual is an independent contractor if you, the person for whom the services are performed, have the right to control or direct only the result of the work, and not the means and methods of accomplishing the result. 

If there is any doubt about the status of your employees or independent contractors, contact the IRS, Arizona Department of Economic Security, your workers’ compensation insurance provider, and an attorney or an accountant for professional assistance. (24)

Contact: Internal Revenue Service, 800.829.4933
Independent Contractor (Self-Employed) or Employee?

Contact: Arizona Department of Economic Security, Tax Audit Offices 
Employment and Wages: Defining An Employee - Who Is An Employee?