What Is A Registered Agent When Signing Up For Domestic Limted Liability

A registered agent is an individual or company that receives service of process, legal documents and official notices on your business's behalf. When registering a business entity, you'll exist required to appoint a registered agent who has a physical address in the state of registration.

Not merely anyone tin fill this role, though. There are certain rules you demand to follow when choosing one. Find out why you lot need a registered agent, who you can appoint and how to change agents.

Who needs a registered agent?

Any business organisation that is registered with the land needs to appoint a registered amanuensis, also called a statutory agent or resident agent in some states.

The post-obit types of businesses demand to engage i:

Corporations
Limited liability companies
Limited partnerships
Express liability partnerships
Express liability express partnerships (not recognized in every state).

If you accept one of these business types, you lot'll exist asked to proper name your registered agent during incorporation or concern registration. There'southward typically a spot to designate your registered agent on your manufactures of incorporation or articles of arrangement.

General partnerships and sole proprietorships don't demand to designate one because these business types are not registered with the land. Of course, all businesses need to keep upwards with concern tax obligations and reply in a timely way to legal papers. However, the government doesn't keep registered agent information on file for sole proprietorships and general partnerships.

Why do you need a registered amanuensis?

States have required businesses to appoint registered agents for decades. The main purpose is to ensure that there's a reliable fashion for the public, the courts and the government to contact your company. Once the state has your registered agent data, information technology'south a matter of public record. Anyone searching through a business entity database can notice out who serves this role for your company.

More specifically, here are the iii main reasons why registered agents are of import:

Receive legal process: People with legitimate legal complaints against a business have an accost to ship service of process.
Authorities can contact yous: The government knows how to contact a business that'south delinquent on taxes or noncompliant with other laws.
Stay in compliance: Official papers notifying you of any action y'all need to take get to i accost.

Most businesses hire a legal service or an attorney to serve equally registered agent. Your registered agent will receive legal, tax and other official mail for you, forrad the documents to your business organisation address and notify you of any deadlines or deportment that you need to take. For urgent documents, such every bit discover of a lawsuit, you'll probable be notified the very same day.

Registered agent requirements

In general, registered agents must meet the following requirements:

Age: If you apply an private, they must be at to the lowest degree 18 years old.
Residency: If you use an individual, they must be a resident of the country of registration. If the registered agent is a visitor, it tin can be a domestic or foreign entity, equally long every bit it'southward authorized to practise business in the land.
Physical address: Must have a concrete accost in the state of registration. This location is unremarkably called the "registered function." P.O. boxes don't count, so you can't apply a UPS Store, for example.
Availability: Must be available to receive mail service and sign official documents during normal business organisation hours, Monday to Friday, ix a.1000. to 5 p.grand.

Unlike states take slightly different regulations. For example, in Virginia, only licensed attorneys or officers or members of the business can serve every bit registered agents. And Arizona doesn't mandate that registered agents need to exist available during normal business organisation hours. Your state'due south business filing agency will be able to tell you more about state-specific requirements.

In some states, the registered agent must submit a consent form indicating that they've agreed to be your company's registered agent.

Go along in mind that if you're registered to do business in multiple states, each state will require you to name a registered agent who has a physical address in that state.

Who tin serve as your appointed agent?

Every land gives yous the choice to appoint yourself, someone else inside the company or a third party, every bit long as the appointed amanuensis meets the requirements mentioned to a higher place (plus any additional state-specific requirements). The only caveat — you lot can't name your concern as its own registered agent. There needs to a separate, responsible party, whether that'due south an individual or an outside agency.

Any of the following tin serve:

Yourself
A business partner, officer, managing director or member of the business
A business lawyer
A visitor that provides this specific service, such as LegalZoom or Rocket Lawyer.

Often, the quickest, least expensive way is to just appoint yourself or another person in the company as the registered amanuensis. Merely business concern owners often find that this is too time-consuming or inconvenient and end upwardly appointing either a lawyer or a service.

Joe Horan, the possessor of Wrightwood Homes, an Indianapolis-based property buyer, says:

"I originally chose myself because it was the easiest style to start my LLC. Merely I've recently chosen my attorney to be my registered agent. The master reason is that my attorney too has her ain real estate business, so she understands the details of mine. She can handle all necessary paperwork and be the 'legal face up' of my business organization. It'southward fairly inexpensive for the service. I pay virtually $100 per year for my attorney to exist the registered agent for my business."

Rithvik Musuku, the president and CEO of Advancing Science Worldwide, went with an even less expensive option:

"In Arizona (where we are incorporated), a registered agent tin be any person, and at that place is no requirement for them to be available during normal concern hours. One of my family members living in Arizona is the registered agent for Advancing Science Worldwide. I would suggest that those looking to start a business wait into the registered agent requirements for their specific states."

Ultimately, the state doesn't care so much about who you lot choose, equally long every bit they're doing what's required of them, so make sure your pick is convenient for y'all.

Reasons to use a legal service

Dozens of legal service websites, including LegalZoom, Rocket Lawyer and IncFile, offer registered amanuensis services for a fee. There are multiple benefits to using one of these services, as opposed to appointing yourself or someone else within the visitor.

These are the benefits of using a legal service:

Inexpensive

LegalZoom, Rocket Lawyer and IncFile charge about $150 per year for registered agent services. You can detect fifty-fifty less expensive services, but the nice matter about sites like LegalZoom is that they besides provide other kinds of legal assistance with business setup and maintenance.

As your registered agent, they volition have all legal and official correspondence on your company'south behalf, forward you the documents and give you timely notifications about pending deadlines or actions that you need to take.

Saves you fourth dimension

Nearly i-third of small-business owners piece of work more than 50 hours per week. If you're spending fourth dimension sorting through official mail, that adds to your already busy lifestyle.

By using a service, you're free to become on vacation or take time off without worrying that you're missing of import postal service. You also salvage time of going through junk mail. Since a registered agent'due south address is a thing of public record, you will receive a lot of junk mail service if you engage yourself.

Privacy

Having a registered amanuensis means that their address is public record, non your own. This protects your business to some extent from spammers. In improver, when you take an appointed agent, you can avoid potentially embarrassing moments in front of customers. Imagine being served with a lawsuit while you're helping a customer. A service will ship yous important documents via email and postal postal service.

Organization

If you have a fast-growing business, it tin can be tough to keep all your of import paperwork and deadlines straight. Having a registered agent is i style to ensure that zippo gets lost in the shuffle. In addition to accepting official correspondence, LegalZoom and many other legal services will create a compliance agenda (similar the 1 pictured above) for your business organization, noting important regime deadlines.

Matt Ross, co-owner of RIZKNOWS and The Sleep One thousand, which operate multiple internet properties, chose LegalZoom after using the website for LLC setup.

"We used LegalZoom to grade our LLC, so we thought information technology was easiest to stick with them equally our registered agent too… Whenever they receive documents from the state, they immediately snail-postal service us copies. Inside the LegalZoom account portal, you tin can as well merely download PDF copies of the documents every bit well. In addition, there is likewise a calendar within the LegalZoom business relationship portal that shows you when important deadlines are budgeted."

Photograph credit: Texas Secretary of State

Irresolute your registered agent

No thing who you select, yous'll demand to go along the information upwardly to date. Having a registered amanuensis is an ongoing requirement, meaning that you need 1 as long as your business organisation is operating.

If you change your registered amanuensis or their contact information changes, you'll need to inform your state'south business organisation filing bureau. In well-nigh states, at that place is a change form (case from Texas shown above) that yous can download and fill out online. Some states let electronic filing, while others require that you lot mail in the grade. The fee for changing your appointed agent is usually pretty low, $25 to $50 in most states.

It'southward easy to forget about updating your registered agent, but make sure you fill out the necessary papers. The fines for a lapse can be pretty hefty. And if you go besides long without an appointed agent, the land can revoke your certificate of skillful continuing or even deliquesce your company.

A version of this article was get-go published on Fundera, a subsidiary of NerdWallet