Do I Need a Registered Agent for My Business?
What is a Registered Agent? What Do They Do for a Business?
When you register your business with a state, one of the required bits of information is the name and address of your business's registered agent. This information is important, so don't leave it out. You can put down your name and address as a registered agent, but it's much better to hire someone. This article explains why having a registered agent is a good idea for your business.
What Does a Registered Agent Do?
Every U.S. state requires businesses that register with a state as legal entities (LLCs, partnerships, corporations) to have a registered agent, sometimes called a statutory agent or agent of process.
Everyone (including businesses) have a right to due process, with procedures to make sure that the legal process provides for fair procedures. That includes the right to be notified when legal action is taken against them.
The registered agent is the person who is designated to receive federal and state legal documents and service of process (a summons or subpoena, for example). For example, it's not enough to just mail a summons to a defendant, because there's no way to be sure that the person received it. Someone must acknowledge receipt, and that's where the registered agent comes in. States want to be sure there is always someone who can sign for these documents.
A registered agent accepts legal paperwork on behalf of your business. This service must have a physical address (not a post office box) in the state and be open during normal business hours to receive legal notices.
If your business is registered in more than one state, you will need a registered agent in each state. Some registered agent businesses can provide this service in every state.
The registered agent receives the legal notice, signs for it, and emails a copy of the notice to the business client.
The cost of a registered agent service varies, but you might expect to pay between $125 and $200 each year. Some registered agents provide additional services for an additional cost, such as filing documents, notifying businesses of upcoming events like an annual filing or a franchise tax filing date.
How Do Registered Agents Qualify?
Here's an example: Delaware has a list of registered agents that have met the state's listing standards. These standards include:
- Being generally open or (for an individual resident) be generally present at a designated location at "sufficiently frequent times" to accept service of process.
- Be authorized to transact business in the state (if a foreign entity)
- Accept service of process and other communications and forward these to the legal entity (the business paying them)
- Give the legal entity an annual report or notice as required by the state
- Keep contact information for entities it represents, including name, business address and business phone number of a natural person ( human being, not a corporation) who is authorized to receive communications from the registered agent.
Registered agents only deliver during normal business hours. If your business is always open or you work from home and there's always someone there to sign for the delivery of service, you might be able to spare yourself the expense and just list yourself as the registered agent.
What are the Benefits of Having a Registered Agent?
A registered agent can be a benefit to your business in several circumstances:
- If you have a PO Box as the mailing address for your business (federal and state notices can't be sent to a PO Box).
- If you don't want the embarrassment of being served legal documents in front of employees or customers.
- So you don't need to worry about missing important documents while you are on vacation or if you travel frequently.
- If you change your business location (within your state), you don't have to file a registered agent change with your state. You just need to notify your
- If you do business in multiple states, you can use the registered agent service in all those states (with a different in-state address for each).
- You won't be in danger of having fines or penalties imposed if you miss a deadline, and
- You won't be in danger of falling out of good standing with your state.
A registered agent doesn't accept all of your business mail and forward it to you. If a court needs to send your business a legal notice, they use the address of your registered agent that's on file with your state.
How Do I Get a Registered Agent?
You can find many registered agent services if you do an internet search. Some things to do before you decide on a service:
- Find out what's included in the service and what is extra.
- Find out where the office in your state is located. Many services have offices in the state capital. The service must tell you where the office is, so you can include that information in the registration with your state. Make sure it's a legitimate business location.
- Talk to someone with the service, and ask questions. If you can't get a reply, question whether the service is legitimate.
- Read reviews. Before selecting a service, I checked it out on Google+.
In short, if you have yourself as the registered agent for your business, think again. You might decide it's better to have a registered agent service perform this task.
Legal Information Institute. "Due Process." Accessed Feb. 18, 2020.
Florida Division of Corporations. "Service of Process." Accessed Feb. 18, 2020.
Legal Information Institute. "Service of Process." Accessed Feb. 18, 2020.
SCORE. "Should You Hire a Registered Agent or Be Your Own?" Accessed Feb. 18, 2020.
Delaware Division of Corporations. "Registered Agent Listing Standards." Accessed Feb. 18, 2020.