State guide · Arizona
Starting a Medical Practice in Arizona
What physicians need to know about Arizona's regulatory environment, entity requirements, and practice-specific rules.
Entity required
Professional Corporation or Professional LLC
LLC permitted
No
CPOM enforcement
Limited
Top income tax
2.5% (flat)
Min. franchise tax
None
Med board registration
Not required
The information on this page is provided for general reference only and may not reflect recent regulatory or legislative changes. Entity formation requirements, tax rates, and CPOM rules vary by state and change frequently. Always verify requirements with your state's official agencies, a qualified healthcare attorney, or a CPA with medical practice experience before making business formation decisions. Nothing on this page constitutes legal or financial advice.
Entity Requirements
Arizona physicians may form a Professional Corporation under A.R.S. Title 10 Chapter 20 or a Professional LLC under A.R.S. Title 29 Chapter 7. All shareholders or members must be licensed Arizona physicians.
Filing is with the Arizona Corporation Commission. Arizona is unique in not having a true Secretary of State role for entity filings — the Corporation Commission handles this.
- •Form a Professional Corporation or Professional LLC
- •All shareholders/members must be licensed Arizona physicians
- •File Articles of Incorporation or Articles of Organization with the Arizona Corporation Commission
- •Publish notice of formation in a county newspaper (most counties)
- •File Annual Report with the Corporation Commission
Corporate Practice of Medicine
Arizona's Corporate Practice of Medicine doctrine is comparatively limited. Lay ownership of medical practices is restricted by the entity statute (must be physician-owned), but Arizona does not aggressively enforce CPOM as a separate doctrine. Fee-splitting is prohibited.
Tax Considerations
Arizona transitioned to a flat 2.5% personal income tax in 2023, one of the lowest in the country. There is no franchise tax. Arizona corporate income tax for C-corps is 4.9%.
- •Flat 2.5% personal income tax
- •No franchise tax
- •4.9% corporate income tax on C-corps
- •Transaction Privilege Tax (Arizona's sales tax) applies to certain transactions
- •Pass-Through Entity Tax election available
Arizona Medical Board
Arizona does not require entity registration with the Arizona Medical Board for general practices. Individual physicians are licensed.
- •No general entity registration required
- •All practicing physicians must hold an active AZ medical license (MD or DO via separate boards)
Employment Law Considerations
Arizona is generally employer-friendly. The state has paid sick leave under the Fair Wages and Healthy Families Act (40 hours/year for most employers). Non-compete agreements are enforceable if reasonable.
- •Arizona Paid Sick Leave: up to 40 hours/year (Fair Wages and Healthy Families Act)
- •Arizona minimum wage adjusts annually with inflation (above federal)
- •Non-compete agreements enforceable if reasonable
- •At-will employment is the default
Official resources
Bookmark these official agency portals for Arizona entity formation, tax registration, and medical board information.
Looking for Arizona licensing and credentialing information?
State medical license requirements, controlled-substance registration, and Medicaid enrollment specifics for Arizona.
View Arizona licensing guide →Get the complete practice startup guide
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