You’re filling out the documentation for your limited liability company (LLC) or corporation with confidence until you’re asked to name a registered agent. Perplexed? You are not alone!
why do I need a registered agent?
Many small business owners need a registered agent to meet the legal requirements for their business entity. Every state in the U.S. requires you to have this appointed representative to receive legal messages for your company.
You might be asking why a middleman is required to handle your legal documents. While the law allows you to be your agent. There are several things to consider before taking on this role. But first, let’s clarify the job of a registered agent. Why would your company want one, and who is qualified to serve in this capacity?
what exactly is a registered agent?
The registered agent is a liaison between your company and the legal system. They receive and forward legal correspondence from government entities on your behalf.
But why is the presence of the agent required to obtain your legal paperwork? The registered agent role was created so that firms would not be able to hide behind their workers when served with legal documents.
Assume the state attorney’s office mailed a legal document to your company, but you were absent when it arrived. However, the employee who retrieved the mail that day did not bring the document to your attention. The attorney’s office calls the next thing you know, questioning why you didn’t react to their letter.
If the paperwork had been sent to the address of your registered agent, they would have called you right away and sent it to you, keeping you from missing deadlines and possibly getting fined. The agent can scan the document and send it electronically via email or a private online portal.
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who requires the services of a registered agent?
A registered agent is optional for some businesses. Only individuals who apply for their business structure as an LLC corporation, or other legal entity must name this representative.
You do not need to choose a registered agent if your company is a sole proprietorship or partnership.
The registered agent of a corporation is named in the articles of incorporation. Still, the agent of an LLC is named in the articles of organization filed with the Secretary of State.
what do registered agents perform?
The registered agent’s work is simple. They will accept all legal paperwork on your behalf. This could involve the following sorts of communication:
- Correspondence with the federal and state governments
- Subpoenas
- Notices from the IRS and local governments
- Lawsuit paperwork
- Court summons
- Wage garnishment notices
- Serving of process notifications where there is a pending lawsuit against the company
The agent forwards these documents to you or your chosen representative upon receipt.
the advantages of using a registered agent
Although the law compels LLCs, corporations, and other formal entities to have a registered agent, there are various advantages to doing so.
- A Safe Address Registered agent might be beneficial if your company does not have a distinct office location or your mail is addressed to your home address or a P.O. Box. Federal and state paperwork is not permitted to be mailed to P.O. Boxes.
- Privacy. You probably don’t want legal paperwork served in front of staff and consumers.
- Relaxation. You can be sure that important legal documents won’t get lost, which could lead to missed deadlines and fines.
- Reliability. You may not be available at the physical site of the firm during regular business hours to receive legal documents. However, documents can be delivered directly to your registered agent without your presence.
- National Coverage If you conduct business in more than one state, you must use a registered agent in each state.
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what are the requirements for a registered agent?
While registered agent requirements vary by state, they must be at least 18 years old and have a physical address (also known as a “registered office”) where the organization is founded. A P.O. Box cannot be used as an address.
During business hours, usually Monday – Friday, from 9 am to 5 pm, the potential agent must also be present to receive official mail and sign official documents.
Several states have additional requirements for being a registered agent. Also, consider that several states use terms other than the registered agent.
In Massachusetts, for example, the terms “resident agent” and “commercial clerk” are interchangeable, whereas agents in Maine are referred to as “commercial clerks.”
are you able to act as your registered agent?
You can nominate yourself as a registered agent or an employee. While this is a simple solution to avoid the requirement, there are several disadvantages to doing it yourself.
- You must have a physical address in the state where you intend to conduct business.
- If you do business in more than one state, you’ll need to appoint third parties to act as your registered agents in the other states where you do business because you can only be in one place at a time.
- You must be available to receive legal documents during regular business hours. This limits your ability to work flexible hours.
- When you relocate, you must file an official state filing, which includes a cost.
- Because the address of a registered agent is public information, your personal or company address will likewise become a public record. This can lead to a breach of privacy.
- Because they are delivered to the same address, your legal documents may be mixed up with regular mail.
additional people who can act as registered agents
If you are unable to designate yourself as a registered agent, you may choose any of the following individuals:
- A reliable friend or family member who can meet the agent’s standards
- Your company partner or another trusted member of your team
- A business lawyer or law firm representative
- A dedicated registered agent service
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reasons to consider hiring a registered agent
While you can hire anyone who fits the requirements to be your registered agent, you can also employ a registered agent service. These service businesses are formed solely to provide registered agent services. The following are some of the advantages of using a registered agent service.
- Lower Risk: Registered agent services are professionals in legal document handling compliance. They are always available when needed and ensure your company meets all deadlines.
- Increased Accessibility: If you use an individual as your registered agent, the person may be unavailable when legal documents are served. On the other hand, using a service ensures that someone is always present during business hours to receive your crucial documents, legal notices, and paperwork.
- Effective Technology: Services now have more access to technology, allowing them to scan your documents and instantly upload them to an online account. As new papers are received, the service can notify you through text or email. You frequently have 24-hour access to your scanned papers via an internet interface.
Increased Level Of Security: Registered agent services maintain all applications and data on secure servers, networks, and data storage systems. Many have regular security audits to guarantee they are safe. - Availability Of Extra Services: Further perks of registered agent services may include pre-filled forms, annual report reminders, and free mail forwarding.
- Representation In More States: Many registered agent services have state-specific offices. This enables you to use their services everywhere your company operates without hiring a different agent in each state.
what to look for when selecting a registered agent service
Conduct your research before selecting a registered agent service.
Reputable organizations will provide services, including document scanning, compliance management, and better security. Pricing may differ according to the breadth of their services.
Getting recommendations from other small business owners can also help you choose a reliable and experienced service with good customer service.
replacing a registered agent
When it comes to choosing a registered agent, you have numerous options. But what if you need to replace them? If you are dissatisfied with your registered agent, you can change them anytime.
Updating your registered agent is as simple as filling out an update form on your state’s business website. You’ll also need a consent form signed by your newly designated special agent. Both forms can be submitted electronically or mailed to the state’s business department. Upon submitting the change, a small filing fee is necessary.
how Countick can assist
Your tax structure will alter if you decide to form an LLC or company and choose a registered agent. This necessitates time-consuming paperwork and close attention to detail to ensure compliance with IRS requirements. Your bookkeeping needs will also change due to your new business status.
Countick provides a team of specialists to do your monthly bookkeeping following IRS regulations. Our tax service subscribers are entitled to unlimited tax advice calls with our in-house tax professionals. They can assist you with your tax questions, such as which filing form optimizes your company’s tax bill the most.
learn more about our business tax filings and consultation services.
You can also talk to us for a summary of the pros and cons of each structure if you need help deciding which entity form is best for you.
are you looking for a registered agent for your company?
A registered agent or service ensures you receive your legal documents on schedule.
A registered agent is essential for firms that operate as LLCs and other corporate forms. Still, any small business owner can benefit from their flexibility, security, and privacy, no matter how the business is set up.
Registered agent services might even help business owners by making their businesses more accessible, improving security, and allowing them to provide services in all 50 states.
