When forming an LLC or a corporation you need to have a designated registered agent. This person is required to be registered in the state that you do business in and must be available during business hours. Without a registered agent, your business may not remain in compliance, so it is essential that you do a good job in selecting this person. Although it might seem like an easy task, the person should be reliable and there should be no question what their tasks are to complete.
What Does a Registered Agent Do?
Registered agents are a designated person or third party service that receives service of process notices, as well as correspondence from the Secretary of State, and other official government notifications. They must be available during business hours in order to accept tax documents, as well as notices if you are sued. Every corporation or LLC should have one.
Legally, Do You Need to Have a Registered Agent?
As an LLC or corporation, you do need a registered agent. Especially if you have a PO Box as the mailing address for your business, you will need official documents to be sent to the address of your registered agent. Having a registered agent will also prevent you from being served with legal documents at your place of work, or home if you set your home as your business address. This prevents you from looking unprofessional.
You can assign yourself as a registered agent, but if you are someone who wants to travel or go on vacation with your family this may prove a problem. Having a registered agent allows you to never miss important documents. This is the same situation if you change your business location often. You will want to have a registered agent in the state so that you do not have to continually report an address change to the secretary of state.
Having a registered agent is essential to avoid fines for missed deadlines. Your registered agent should always remind you of deadlines that should not be missed such as annual fees. This will avoid you falling out of good standing with your state.
Registered Agent Requirements and Qualifications
As a registered agent, there are a few specific requirements.
- Be over 18 years of age.
- Being available during business hours.
- Being present at locations during these hours.
- Be legally allowed to work in the state of formation.
- Accept service of process and other communications.
- Be responsible for forwarding important items to your business.
- Keep contact information for who they represent.
What Qualities to Look for in a Registered Agent
Although it may sound like there is not much that you would need to look for in a registered agent, there are many qualities that will help you find someone who is right for the job.
Registered agents should have experience in the corporate world. They should be able to receive more than just documents, but also be able to offer insight about forming and maintaining your business.
Access Your Document Quickly
Your registered agent should also be able to access their documents easily. If they need to present these documents to the state it should be a quick process. They should also be able to access critical corporate documents whenever necessary.
Expert in Your State
All registered agents are not created equal. Good registered agents should be aware of all corporate requirements specifically in your state. This is because laws vary, fees vary, and requirements vary.
Over everything, your registered agent should be available. This is one of the main reasons that you need a registered agent. They need to be able to accept documents for your company. Although you may not need to communicate often, they should be there when you need them.
Should You Hire a Friend, Family Member, or Colleague as Your Registered Agent?
You can hire a friend, family member, manager, or employee as your registered agent. This will save you money but it is not always a great idea. This person needs to receive official documents and giving this task to a friend or family member could cause issues if they do not fulfill their duties. Additionally, this person will be the face of your corporation. If they do not do their job you will be in serious trouble.
Why You Should Consider a Business Lawyer as Your Registered Agent
Using a business lawyer as your registered agent provides you a sense of security. Lawyers are known to do their jobs and do them well. They are aware of all the legalities that go along with forming a business, and you can be assured they are responsible, and available during business hours.