What is a Registered Agent?
Are you planning to form a corporation or a limited liability company?
Want to know about these businesses structures in as much detail as possible?
While researching about how to form a corporation or an LLC on the internet, you will often come across the term ‘registered agent’.
Who is this registered agent? What is their job? Should every business have a registered agent? Can you be the registered agent of your business?
Continue reading to find answers to all of these questions and more.
What is a Registered Agent?
When you form a legal entity such as a corporation or an LLC, you are required to nominate a registered agent. It can be an individual, or you can also designate a professional registered agent service company for the same.
It is this registered agent who receives all the essential legal documents such as service of process, annual statements or reports, tax documents, etc. on behalf of the business. In simple words, the registered agent is the official point of contact for your business with the state and general public for receiving legal documents.
While most states use the term registered agents, some states call them the agent of process, resident agent or statutory agent.
What Does Service of Process Mean?
Service of process or SOP is the initial notice sent to a corporation or LLC when a lawsuit is filed against them. Generally, the SOP serves as a summon to the defendant.
If you are running a business, the SOP is sent to your registered agent. By sending the SOP to your registered agent, courts obtain jurisdiction over your business.
Read more about Service of Process here.
What Does a Registered Agent Do?
Apart from receiving SOP and other legal documents, a registered agent generally has the following responsibilities-
- Provide guidance during business filings
- Give you a notification when the annual reports of your business are due
- Offer business knowledge when needed
Does Every Corporation or LLC Needs a Registered Agent?
Yes, every corporation irrespective of whether it is taxed as a C corp or S corp, an LLC is required to have a registered agent in the state where your business is formed. If you have expanded your operations to other states and are registered to do businesses in those states, you need to have a registered agent in those states as well.
The address of the registered agent and that of your registered office needs to be the same, and their address should be used only for receiving official documents from the state or general public. If you are not incorporated and want to conduct business overseas, you might still need a registered agent.
What If You Do Not Have a Registered Agent?
You cannot file your Articles of Organization or Articles of Incorporation if you do not provide the name and address of your registered agent. Moreover, even after your business is formed, you are required to maintain the registered agent and also notify your state in case if you change the registered agent or their registered address.
There can be a number of severe consequences if you fail to maintain your registered agent or do not update the state in case of any changes.
For instance, there is a possibility that your corporation or LLC might lose its good standing or unabated powers of conducting business without a registered agent. Moreover, without a registered agent, your business will not be able to receive critical legal documents like annual reports, tax documents, subpoenas, or SOP.
Are There Any Requirements for Being a Registered Agent?
Yes, there are a few legal requirements for being a registered agent with regards to the physical address and availability.
Your registered agent needs to be available throughout the normal business hours. They should also have a registered address within the state where the corporation or LLC has been incorporated, formed, or qualified. The name and address of your registered agent is a public record. Anyone who wants to know the same could do so through the records of your state.
Can You Be Your Own Registered Agent?
YES, it is possible for you to be registered agent of your business. As long as your physical address is in the state where the corporation or LLC is formed, you can name yourself the registered agent. But be very careful while doing so as you will be required to remain available at your desk at the registered address throughout the business hours.
As a result, most corporations and LLCs generally prefer designating a professional 3rd party as their registered agent. By doing this, you will have a professional service provider who will be responsible for receiving all your important legal and state documents and pass the same to you.
Apart from the standard duties of a registered agent, the company can also assist with all of your other compliance obligations.
If you are planning to form a corporation or LLC, you will surely need a registered agent, and there are no two ways about it. Any member of your corporation or LLC can be the registered agent, or you can register as the agent yourself.
As a registered agent, you will be required to handle a lot of responsibilities. So, if you are planning to be the registered agent, do so only if you are confident. If you are not sure whether or not you will be able to handle the responsibilities, just look for a reputed registered agent service provider.