When registering your LLC, partnership, or corporation, you will need to fill in the name and address of your business’ registered agent when filing your Articles of Organization with the Secretary of State. While forming your own company does seem overwhelming, it doesn’t have to be. Thankfully, there are third-party, incorporation services:2020 that handle your entire business formation process saving you attorney’s fees and allowing you to focus on growing your business.
What is a registered agent?
Simply put, a registered agent (also known as an agent for service of process or statutory agent) is an individual or business entity that accepts or sends legal documents such as tax forms and notice of lawsuits on your company’s behalf.
Why do I need a registered agent?
State laws require corporations and LLCs to have a registered agent as soon as you form your entity. It is a business compliance requirement that you don’t want to ignore.
What are the benefits of having a registered agent?
Privacy: Your registered agent’s physical address will be listed on the public record, rather than your company’s. This is especially important if you work from home. Listing your home address means anyone can access your information and increases your chances of receiving unsolicited mail.
Compliance with the Law: You will want to make sure that you keep track of official notices like annual report filings. A registered agent will make sure you are informed about any paperwork you need to review and on which you need to take action. This will help you stay in good standing because you’ll avoid missing filing deadlines that could result in fines for noncompliance. A registered agent also:
- Helps you find accountants and legal professionals in your state, a service most LLCs require sometime during their formation.
- Keeps copies of your corporate documents, which means you will have a backup in the event of theft or unexpected losses.
Peace of mind: Having someone else responsible for the receipt of legal documents means you can leave the office freely. Your business and personal mail are separate, preventing your work from taking over your home life. You will also have additional support if your business runs into a problem or if any questions arise.
Flexibility: If you choose to act as your own registered agent, you will need to be available during standard business hours to receive official legal government correspondence at the physical address you provide. If you or the assigned employee spend a lot of time travelling or away from the designated physical address, you will risk not receiving these important documents. With a registered agent being available all day during the work week, important legal documents will not slip through the cracks.
Who can be my registered agent?
There are three options:
Option 1: You can be your company’s registered agent.
Option 2: A friend or colleague.
Option 3: You can appoint a registered agent for a fee.
There are however, certain restrictions and requirements to being a registered agent.
What are the requirements of a registered agent?
Most states allow anyone who is a state resident over age 18 who has a physical address in the state – not a PO Box – to serve as a registered agent. However, the assigned person or entity must be available at the registered address during regular business hours, Monday to Friday. This is crucial in the case of a lawsuit and to remain compliant with legal forms and deadlines.
Can I be my own registered agent?
While it’s tempting to act as your own registered agent for your LLC or corporation, it’s generally not a good idea to do so. It might sound cost-efficient, but it also poses potential drawbacks:
- Your name and address will be on the public record filed with the state and will jeopardize your privacy, especially if you work from home. It also makes you susceptible to marketers and increases your chances of receiving junk mail.
- If you are served with a lawsuit, it might happen in front of your customers or employees, which can be embarrassing for both parties.
- If you move or relocate your business, you will need to update your information with the state, which can be time-consuming or worse, you may forget!
- You will need to be physically available at the designated address during regular working hours, Monday to Friday, curtailing travelling and the possibility of going on vacation.
- If compliance matters are not your area of expertise, you may be subject to a high risk of penalties and fees.
Forming a business can be challenging and time-consuming. Having a registered agent can provide an extra layer of protection by making sure your business stays compliant.