When a business plans to shutter permanently, it will need to cancel its Transaction Privilege Tax (TPT) license. Not canceling a TPT license can lead to fines and penalties. 

How to Cancel a TPT License 

Businesses can cancel their TPT license online, by mail, or on a TPT Return. 

If on the TPT Tax Return, check the box above the Business name that states "Final Return (Cancel License)." Submit the return as usual. 

To cancel by mail, submit a written request, which includes: 

The license number 

The name of the business 

Either a signature OR simply write CANCEL on the license with an effective close date 

Written requests can be sent to: 

License and Registration 

AZDOR 

1600 W Monroe 

Phoenix, AZ 85038 

Those with an account with AZTaxes.gov can either close or cancel their account using the Business Account Update features. Under the Business Details page, select the Account Update button and then the Close Account(s) button. The web page should direct individuals on how to proceed. 

Monthly Filing 

Arizona requires TPT licensees to file TPT returns even when they have zero sales. Failure to file monthly can lead to monetary penalties. That's why canceling a TPT license is vital to closing a business. Failure to do so can lead to a company and its owner having to pay penalties to the Arizona Department of Revenue. 

Temporary Closures 

If a business doesn't intend for closure to be permanent, depending on the length of time they plan to close, it may make more sense for them to keep their TPT license active. In this situation, they must file the monthly TPT return, even if their sales are zero. 

The advantage of keeping a TPT license active is that once a business reopens, they don't have to re-file for a TPT license. 

If you need help, call Senior Partner, Tax Controversy Attorney, and former IRS attorney Brandon A. Keim at (602) 200-7399 or contact him online to discuss your options.