What Legal Responsibility Is There To Be A Registered Agent Of Incorporatinon

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 be required to appoint a registered agent who has a physical accost in the state of registration.

Not but anyone can fill this role, though. There are sure rules you need to follow when choosing i. Find out why you need a registered amanuensis, who you lot tin appoint and how to alter agents.

Who needs a registered agent?

Whatsoever business organization that is registered with the state needs to appoint a registered agent, besides chosen a statutory agent or resident agent in some states.

The following types of businesses need to engage one:

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

If you have one of these business types, you'll be asked to name your registered agent during incorporation or business concern registration. At that place's typically a spot to designate your registered agent on your articles of incorporation or manufactures of organization.

General partnerships and sole proprietorships don't need to designate one because these business organization types are not registered with the land. Of course, all businesses demand to proceed upwardly with concern tax obligations and answer in a timely style to legal papers. Nonetheless, the government doesn't continue registered agent information on file for sole proprietorships and general partnerships.

Why do you demand a registered agent?

States have required businesses to appoint registered agents for decades. The main purpose is to ensure that at that place's a reliable way for the public, the courts and the government to contact your company. Once the state has your registered agent information, information technology'due south a thing of public record. Anyone searching through a concern entity database tin can find out who serves this role for your visitor.

More specifically, hither are the iii principal reasons why registered agents are important:

Receive legal procedure: People with legitimate legal complaints against a concern have an address to send service of process.
Regime can contact you: The government knows how to contact a business that'due south delinquent on taxes or noncompliant with other laws.
Stay in compliance: Official papers notifying you of whatever activeness y'all need to take go to 1 address.

Most businesses hire a legal service or an attorney to serve as registered agent. Your registered amanuensis will receive legal, tax and other official mail for you, frontward the documents to your business address and notify you of whatever deadlines or deportment that yous need to take. For urgent documents, such as detect of a lawsuit, you'll likely be notified the very same day.

Registered amanuensis requirements

In general, registered agents must meet the following requirements:

Historic period: If you utilise an individual, they must exist at least 18 years onetime.
Residency: If you use an individual, they must be a resident of the state of registration. If the registered agent is a visitor, it tin can be a domestic or strange entity, equally long as it's authorized to do business in the state.
Concrete accost: Must accept a physical accost in the country of registration. This location is commonly chosen the "registered office." P.O. boxes don't count, and then you can't use a UPS Shop, for example.
Availability: Must be available to receive mail and sign official documents during normal business hours, Mon to Fri, 9 a.yard. to 5 p.m.

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

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

Keep in mind that if y'all're registered to do business in multiple states, each state volition require y'all to name a registered agent who has a physical accost in that state.

Who tin serve as your appointed agent?

Every state gives you the choice to appoint yourself, someone else inside the visitor or a third party, as long as the appointed amanuensis meets the requirements mentioned above (plus whatever additional country-specific requirements). The but caveat — you lot can't name your business as its ain registered agent. There needs to a separate, responsible political party, whether that's an private or an outside agency.

Any of the following tin serve:

Yourself
A business partner, officer, managing director or fellow member of the business
A business organization lawyer
A company 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 visitor as the registered agent. But business organization owners often find that this is too time-consuming or inconvenient and end upwardly appointing either a lawyer or a service.

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

"I originally chose myself because it was the easiest way to showtime my LLC. But I've recently chosen my attorney to be my registered agent. The chief reason is that my attorney also has her own real manor business, so she understands the details of mine. She can handle all necessary paperwork and be the 'legal face' of my business concern. It'southward fairly cheap for the service. I pay about $100 per twelvemonth for my attorney to be the registered agent for my business."

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

"In Arizona (where we are incorporated), a registered agent can exist whatever person, and there is no requirement for them to be available during normal business hours. 1 of my family members living in Arizona is the registered agent for Advancing Science Worldwide. I would suggest that those looking to offset a business wait into the registered agent requirements for their specific states."

Ultimately, the land doesn't care so much about who y'all choose, as long as they're doing what'southward required of them, and so make certain your selection is convenient for you.

Reasons to apply a legal service

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

These are the benefits of using a legal service:

Cheap

LegalZoom, Rocket Lawyer and IncFile charge most $150 per year for registered agent services. You can find even less expensive services, but the nice thing about sites similar LegalZoom is that they as well provide other kinds of legal assistance with business setup and maintenance.

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

Saves you fourth dimension

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

Past using a service, you lot're gratis to become on holiday or take time off without worrying that yous're missing of import mail. You also save fourth dimension of going through junk mail. Since a registered agent's address is a matter of public record, you will receive a lot of junk mail service if you engage yourself.

Privacy

Having a registered agent means that their address is public record, not your own. This protects your business concern to some extent from spammers. In addition, when you have an appointed agent, you lot tin can avert potentially embarrassing moments in front of customers. Imagine beingness served with a lawsuit while you're helping a customer. A service will send you important documents via email and postal mail.

Organization

If y'all have a fast-growing business, information technology can be tough to go along all your important paperwork and deadlines directly. Having a registered agent is one way 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 calendar (like the one pictured in a higher place) for your business, noting important government deadlines.

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

"We used LegalZoom to course our LLC, and so nosotros idea it was easiest to stick with them as our registered agent too… Whenever they receive documents from the state, they immediately snail-mail service us copies. Within the LegalZoom account portal, you tin besides but download PDF copies of the documents every bit well. In improver, there is too a calendar within the LegalZoom account portal that shows you when important deadlines are approaching."

Photograph credit: Texas Secretary of State

Changing your registered agent

No matter who you select, you'll need to keep the information up to engagement. Having a registered amanuensis is an ongoing requirement, meaning that you need i as long as your business is operating.

If you change your registered agent or their contact data changes, y'all'll demand to inform your state's business concern filing bureau. In almost states, there is a change form (case from Texas shown above) that you can download and fill out online. Some states allow electronic filing, while others require that y'all mail in the grade. The fee for changing your appointed agent is ordinarily pretty depression, $25 to $50 in nigh states.

Information technology'due south easy to forget about updating your registered agent, only make sure you fill out the necessary papers. The fines for a lapse can exist pretty hefty. And if you become likewise long without an appointed agent, the state can revoke your certificate of expert continuing or even dissolve your company.

A version of this article was beginning published on Fundera, a subsidiary of NerdWallet