Volume Three · Section One
Missouri or Arizona?
A side-by-side, honestly written. The right answer is not the same for both companies.
The first real decision in forming an LLC is geographic. Where does the company live? People love to argue about Delaware, Nevada, and Wyoming on the internet, but for a personal holding company or a working contractor LLC, forming in a state where you do not live almost always costs more, requires foreign registration in the state where you actually operate, and provides protection that is mostly theoretical. So the honest comparison is between the two states actually on the table for you: Missouriand Arizona.
The short version is that Missouri and Arizona are both unusually friendly to LLCs. Filing is cheap, neither state requires an annual report, neither state has a franchise tax, and registered-agent rules are reasonable. The differences are small, but they are real, and they point in slightly different directions for the two companies you want to form.
The full comparison
| Topic | Missouri | Arizona |
|---|---|---|
| Filing fee (online) | $50 Articles of Organization, paid to the Missouri Secretary of State. | $50 standard / $85 expedited Articles of Organization, paid to the Arizona Corporation Commission. |
| Registered / statutory agent | Required. Must have a Missouri street address and be available during business hours. You can serve as your own agent if you live in Missouri. | Called a 'statutory agent' in Arizona. Required. Must have an Arizona street address. You can serve as your own agent if you live in Arizona. |
| Annual report | None required for LLCs. Missouri does not impose an annual report or a franchise tax on LLCs. | None required for LLCs. Arizona does not impose an annual report on LLCs (unlike many other states). |
| Publication requirement | None. | Yes — but with a major exemption. New LLCs must publish a notice in an approved newspaper for three consecutive weeks within 60 days of formation. EXEMPT if the statutory agent's address is in Maricopa County or Pima County, where almost all of the state's population lives. Cost ~$30–$120 when required. |
| Operating Agreement | Required by statute (RSMo § 347.081), even for single-member LLCs. The agreement does not have to be filed publicly; it just has to exist. | Not required by statute, but strongly recommended. Without one, the default rules in the Arizona LLC Act govern your company. |
| Charging-order protection | RSMo § 347.119 provides charging-order protection, but courts have been less consistent for single-member LLCs (the policy reasoning behind charging orders weakens when there are no other members to protect). | Arizona's LLC statute states the charging order is the EXCLUSIVE remedy for a creditor of a member, and Arizona courts have generally honored this even for single-member LLCs. Modestly stronger asset protection on paper. |
| State income tax (pass-through) | LLC profits flow to your personal Missouri return. Top individual rate is currently around 4.7% and trending downward. | LLC profits flow to your personal Arizona return. Arizona has a flat 2.5% individual rate — lower than Missouri. |
| Sales / activity tax of note | Standard sales tax on retail. No special tax on contractors as such. | Transaction Privilege Tax (TPT) — Arizona's 'sales tax' is technically a tax on the seller, not the buyer. Contractors performing 'modification' work (new construction) pay TPT on 65% of gross receipts at the prime contractor rate. This MATTERS for JDBuilders LLC if it operates in Arizona. |
| Privacy on filings | Member names are NOT required on the Articles of Organization. Manager-managed LLCs only list managers; member-managed LLCs list at least one organizer. Reasonable privacy. | Member or manager names are required on the Articles, and they are public record. Lower privacy than Missouri, though still less exposing than some states. |
| Crypto-friendliness of banking | Mixed. Most regional Missouri banks are conservative on crypto; you'll likely use a fintech-friendly bank like Mercury, Relay, or Bluevine for the operating account. | Slightly friendlier overall — Arizona has positioned itself as a crypto-aware state, with a state-level digital asset framework. National crypto-friendly banks are still your best bet for either state. |
The right answer for your situation
The cleanest rule of thumb is this: form each LLC in the state where you actually live and work most of the time. The reason is purely practical. The state where you live wants its own filing one way or the other — either as the home state, or as a 'foreign' registration for an out-of-state LLC. Foreign registration is the expensive path. Forming where you live is the cheap path.
If your primary residence is currently in Missouri, both LLCs file in Missouri. If your primary residence is in Arizona, both LLCs file in Arizona. Splitting entities across states only makes sense if there is a specific operational reason — for example, if JDBuilders will only ever take construction jobs in Arizona, then forming JDBuilders in Arizona is sensible even if you live in Missouri.
What stays the same either way
Several decisions do not depend on which state we choose. Both LLCs will be single-member at formation, with you as the founding member. Both will elect default tax treatment — a single-member LLC is a 'disregarded entity' to the IRS, meaning the LLC itself does not file a separate federal tax return; profits and losses flow to your personal Form 1040 on Schedule C (for active businesses like JDBuilders) or Schedule E / Schedule D / Form 8949 (for the holding work inside SkyMining). Both LLCs will obtain their own EIN from the IRS — free, online, in about ten minutes — so you never have to use your social security number on a business form again. And both will open separate business bank accounts; commingling personal and business money is the single fastest way to lose the legal protection an LLC is supposed to provide.