A registered agent is a crucial component for the formation of any business entity, particularly LLCs and corporations. Understanding the responsibilities of this role essential can help ensure that your business remains compliant with state regulations, avoids legal pitfalls, and maintains smooth operations.

To help with this, our What Is a Registered Agent article will delve into what a registered agent is, why your business needs one, and the benefits of choosing a professional service for this role.

What Does a Registered Agent Do

A registered agent (sometimes also referred to as resident agent or statutory agent) is an individual or business entity appointed to accept legal documents on behalf of your LLC.

There are no restrictions regarding who can be an agent other than the person must be located and available at a physical street address within the state during normal business hours.

The name and address of the registered agent of every business entity doing business in a state is maintained in the office of the Secretary of State or other applicable state agency so that the public can use such information to serve official papers on the business entity if necessary.

What Documents Does a Registered Agent Receive?

The purpose of a registered agent is to receive governmental and legal correspondence on your company’s behalf — including your annual report, delinquency notices, and any other documents that your company may be required to respond or take action.

In particular, you can expect your designated registered agent to receive the following on your LLC’s behalf after business formation:

• Tax forms
• Legal documents
• Annual reports (or any official government correspondence)
• Service of process (i.e., summons or notices of a lawsuit)

How Much Does a Registered Agent Cost

The cost of a registered agent varies widely — running anywhere from free (if you act as your company’s registered agent) to a few hundred dollars a year if you hire a professional third-party service.

It’s common for a business owner to appoint an employee or relative in the state to act as their registered agent in order to save on costs. Despite the money you may save yourself, the risks to you, your friends, and your company can be far more significant.

In fact, getting a registered agent service can save you plenty of time and money. Given how affordable the cost of retaining the services of a registered agent service is, it’s just good business sense to take advantage of these services. By doing so, your LLC can mitigate certain risks, such as eliminating the nuisance of a service of process showing up at your home or office.

Who Can Be a Registered Agent

Registered agent requirements can vary in each state, but they generally allow for both individuals and business entities to serve as a company’s registered agent.

Individuals must be at least 18 years old and business entities must be registered to operate in the state. Both must have a physical office location and be present during regular business hours.

Although you can be your own registered agent, we recommend you consider hiring an experienced and reliable registered agent service to handle this portion of your business needs.

Being Your Own Registered Agent

You can be your own registered agent for your business, especially if you manage your LLC as a single-member LLC. However, acting as your own registered agent comes with difficulties.

For example, a registered agent must be available during “normal office hours” at the address listed every business day to accept legal documents — which is typically between around 9 a.m. and 5 p.m.

On top of this, since the details you list for your registered agent on your LLC formation documents are included on public record, you may be bothered at your personal address with nuisances like junk mail and increased solicitation.

Appointing an Individual as Your Registered Agent

Alternatively, you’re also able to appoint an officer or member of your business — or even a friend or family member — as long as the person being elected meets the following registered agent requirements:

• Is 18 years or older
• Must have an actual residence address (a P.O. box or mail center address cannot be accepted, unless in conjunction with a physical address in the state)
• Must be available at said address during normal business hours in order to accept service of process and other documents

Using a Registered Agent Service

The final option available to you is to hire a professional registered agent service. These are third parties that specialize in offering these services, as well as a few value-added extras to make the process of managing your company, remaining compliant, and organizing your records as smooth as possible.

On top of the basic registered agent functions, these services often offer a number of additional features, such as:

• Reminders about important filing dates
• Annual report due dates
• Possible state taxes
• Permits and refiling due dates
• Form libraries to assist you with legal documents
• Online archives of documents received on your behalf with additional information (e.g., date and time served, actual copies of the document received, etc.)

Reasons to Use a Registered Agent Service

There are several compelling reasons why an LLC should seriously consider using professional registered agent services within a particular state.

Privacy and Anonymity

Many states have implemented online computer access to the business records that are maintained in the Secretary of State’s offices or other central record keeping agency in the state.

Using these programs, which are often free of charge to the public, a person can perform a “registered agent” search in a matter of minutes and locate all of the companies for which you act as registered agent.

If you act as your own registered agent for companies that you own, any person can now use your name in an online search to easily and quickly identify those companies. This makes many people very uncomfortable. In fact, many view it as an invasion of privacy.

By using a registered agent service, you can ensure that any summonses or other official legal documents are served to the third-party registered agent, who will then send them to you under private arrangements. Many service agents will scan and email the documents to a designated contact person on a confidential basis.

A registered agent service can thus provide you with anonymity and a level of privacy that otherwise cannot be achieved.

Stability and Continuity

If you are like most small business owners, there is a good chance that you will relocate your business at some point.

Many small companies move their offices from time to time, but in almost every instance the owner who acts as registered agent for the business forgets to file a change of registered agent form with the Secretary of State or other applicable agency.

It is your responsibility to make sure that your registered agent address is current with the Secretary of State’s office so that third parties, including the IRS, can send important papers to you.

A national registered agent service always maintains the same office address and yet can ensure that you will always receive the important papers that are being sent to your LLC, regardless of the states it operates in.

This way, your company remains “active” in the state and you can continue to conduct business legally in the state.

Compliance With the Law

In almost all states, LLCs will be required to file an annual form with the Secretary of State (in some states it’s biennial) in order to keep your company active, and to provide a current business address.

If you fail to file the form after a few years, the states will suspend your license to do business in the state and render the company inactive.

To avoid this from happening, professional registered agents will help to keep your LLC up-to-date with its state requirements by sending regular reminders, and sometimes filings things like annual reports and other official government notifications.

How to Choose a Registered Agent Service

It can be difficult to know which registered agent to choose due to how many options there are available to you.

To help make this decision a little clearer for you, be sure to weigh up the following factors as you make your choice:

• Cost: Evaluate the pricing structure of each service. While some services may offer lower rates, ensure that the cost includes all essential features and services you need and find out whether there are any hidden costs you may be missing
• Features: Compare the features offered by different services and look for additional benefits like compliance monitoring, document scanning and forwarding, online account access, and notifications for important deadlines. A comprehensive service should cover more than just the basics of receiving legal documents
• Customer Service: A professional registered agent service should offer responsive and knowledgeable customer service to help you with any questions or issues; check to see if they provide multiple contact methods, such as phone, email, and live chat
• User Reviews: Read reviews from other customers to gauge their satisfaction with the service — in particular looking for consistent positive feedback on reliability, professionalism, and ease of use. This can provide great insight into potential issues and highlight the strengths of a service
• Accessibility and Transparency: Ensure the service is transparent about its offerings and pricing. Accessibility is also key; the service should be easily reachable and provide a user-friendly interface for managing your documents and compliance needs. Transparency in terms of service details and clear communication can help you make an informed decision