Why do You Need a Registered Agent?

Business entities such as corporations, LLCs, and partnerships require a registered agent. In many cases, it’s a legal requirement.

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For limited liability companies (LLCs) and corporations, a registered agent is responsible for receiving legal communications and other documents on behalf of the business.

Small businesses often appoint an owner or employee as their registered agent. However, there are many circumstances in which a registered agent service is preferable.

Whether you’re forming an LLC or corporation, a registered agent and a registered office are a requirement no matter where you choose to start your business.

What Is a Registered Agent?

The registered agent is the person responsible for receiving legal and other documents on behalf of your business, such as subpoenas, regulatory and tax notices, and correspondence.

It is mandatory to serve lawsuits personally in many states. Registered agents make this process more efficient and clear.

Your registered agent’s name and address are public, so outsiders know where to deliver documents. You can also feel confident that you will only have to deal with one point of contact for any legal notices your business might receive.

Who Needs a Registered Agent?

Any business registering with the state must appoint a registered agent, also referred to as a statutory agent or a resident agent in some states.

It is necessary to appoint one for the following types of business structure:

• Corporations
• Limited liability companies
• Limited partnerships
• Limited liability partnerships
• Limited liability limited partnerships (not recognized in every state).

If your business is one of these types, you will need to name a registered agent at the time of incorporation or business registration. Your articles of incorporation or articles of the organization usually have a place to designate your registered agent.

A general partnership or sole proprietorship need not designate a representative since those business types aren’t registered with the state. It goes without saying that every business must comply with business tax obligations and respond in a timely manner to legal documents.

Nevertheless, the government does not keep registered agent information on file for sole proprietorships and general partnerships.

Why do You Need a Registered Agent?

For decades, businesses have been required to appoint a registered agent. The purpose is to provide a reliable way for the public, the courts, and the government to contact your company. Your registered agent information is public once it’s been recorded by the state. Any person searching through a business entity database can find out who serves this role for your company.

In more detail, here are the three main reasons why having a registered agent is important:

• Receive legal process: People with legitimate legal complaints can send service of process to an address.
• Government can contact you: The government knows how to contact businesses that are in arrears on taxes or otherwise non-compliant with the law.
• Stay in compliance: You will receive official correspondence containing information about any actions you need to take.

In most cases, businesses hire a legal service or an attorney to serve as their registered agent. Your registered agent will receive legal, tax, and other official mail on your behalf, forward it to your business address and notify you of any deadlines or actions that you need to take. You’ll likely be notified the very same day for urgent documents, such as a lawsuit notice.

What are the requirements for a Registered Agent?

As a general rule, registered agents must meet the following requirements:

• Age: If you are using an individual, they must be at least 18 years old.
• Residency: Using an individual, must be a resident of the state of registration. Depending on whether the registered agent is a company or an individual, it can be based in the state or abroad.
• Physical address: A physical address in the state of registration is required. It is usually called the “registered office.” P.O boxes do not qualify, so you can’t use a UPS Store, for example.
• Availability: Should be available during normal business hours to receive mail and sign official documents.

Some states have laws that are slightly different from others. You can find out more about state-specific requirements from your state’s business filing agency.

Depending on your state, the registered agent must submit a consent form stating that they have agreed to act as your company’s registered agent. It is important to remember that if you choose to do business in more than one state, each state will require you to name a registered agent who has a physical address in that state.