LLC Owner’s Guide to Hiring a Registered Agent
by Courtney Johnston | Published on May 18, 2022
A limited liability company (LLC) is a popular business entity that many owners choose when forming a new company. You can form an LLC if you have business partners, employees, or even if you’re self-employed. This business entity offers many benefits but has some requirements you’ll need to consider, such as designating a registered agent.
If you’re considering forming an LLC or are already in the process of starting one, you’ll need to find a registered agent. In order to file your articles of origination and register your new business, you’ll need to assign this registered agent to your LLC. In some states, your agent will even be required to sign your company formation paperwork.
In this guide, I’ll take you through everything you need to know about registered agents, how to find one, and some additional considerations.
Overview: What is a registered agent for an LLC?
A registered agent is an individual or business entity located in the same place as your LLC who is responsible for receiving communication from the secretary of state and other branches of government on behalf of your company.
While most states refer to this individual or entity as a “registered agent,” some states refer to this position as a “resident agent.”
What are the responsibilities of a registered agent?
A registered agent for an LLC has a few different responsibilities. Generally, you can expect your registered agent to:
- Receive government communications on your company’s behalf. Your registered agent is required to have a residential or business address in the same state as your LLC in order to receive government correspondence during typical work hours on weekdays (9 a.m. to 5 p.m. local time). This address must be a physical location where the registered agent is present during these working hours and not a P.O. box.
- Act as a liaison between your LLC and the Secretary of State. In addition, your registered agent will pass on important information between the government and your company for you to then act upon or file while maintaining and keeping records of correspondence from the government.
- Accept summons and subpoenas for your LLC. Your registered agent can also accept summons and subpoenas on behalf of your company in order to keep legal disputes private.
4 reasons your LLC needs a registered agent
A registered agent can be beneficial to any LLC. In fact, finding a qualified registered agent can be important to your company’s operations. Here are four reasons why you should consider hiring a registered agent.
1. It may be mandatory
In many states, it’s mandatory to select a registered agent to represent your company. You won’t be able to form an LLC without designating an agent, and if you continue to fail to work with an agent, your company could fall into bad standing with the state.
While the registered agent you select does not necessarily have to be a third-party agent or service, in many cases it makes sense to hire an outside agent (I’ll get into exactly why a little later on).
2. They offer administrative benefits
If your LLC does not yet have a document management system or isn’t fully prepared to flag important government communications and catch essential paperwork and notices, your company could easily become noncompliant with local or state laws or run into legal trouble.
Partnering with an experienced registered agent is a straightforward way to ensure all government paperwork is sent to a separate address, where it can then be passed on to your company and clearly communicated.
3. You won’t be tied to your desk or office
While you (or another member of your company) can act as your own registered agent in many cases, there are some limitations that come along with this decision, such as being tied to your office address during typical government working hours. This might not be an issue for all LLCs but could become a problem if you enjoy working flexible hours, traveling, or handling business during a different shift.
If you partner with an outside registered agent, however, you’ll have more flexibility in how you run your business, allowing you to determine the schedule that best fits your needs and lifestyle.
4. They can save you from embarrassing legal trouble
No business owner wants to be served a summons or subpoena in front of clients, during an important meeting, or when potential investors are visiting. However, without a third-party registered agent, the government could end up serving your legal papers without warning at your office. Not only can this be disruptive, but it can be embarrassing and potentially kill business deals.
Who can serve as the registered agent for your LLC?
Each state has its own guidelines regarding who can serve as a registered agent for your LLC. I’ll cover some typical criteria below, but be sure to review your state’s secretary of state website for additional requirements:
- Must be 18 or older
- Must live or work in the same state as your LLC and hold a residence or business location within this state
In addition, your registered agent can be an outside third-party agent or a business entity, or could even be yourself (if allowed by your state) or another member of your company. Keep in mind, you’ll lose some privacy protections if you choose to keep your registered agent in-house.
You can also find a list of registered agents online on your state’s official government (or state secretary of state) site.
3 considerations when selecting a registered agent
If you decide to hire an outside registered agent, it’s important you don’t hire just anyone. Your registered agent fills an important role, so you’ll want to keep the below considerations in mind before making a selection.
It’s important to make sure nothing falls through the cracks that could leave your LLC in bad standing with the secretary of state’s office. Some communications require prompt responses and will need to be acted upon right away. A relatively new registered agent might accidentally cause you to miss a deadline or reply too late to a government request.
Working with an experienced registered agent who has handled many different types of government communications and notifications can offer you peace of mind.
Since you need a registered agent who is available in your LLC’s state of formation, you may need different agents if you’re operating in multiple states. You can avoid this hassle by working with a national registered agent who has office locations across the country or with a qualified business service that can serve as your registered agent in multiple states.
Of course, the cost of hiring a registered agent is a factor to take into consideration, especially if your LLC is new and not yet profitable.
Luckily, many reputable online companies such as LegalZoom and ZenBusiness offer registered agent services in multiple states for a low price, while also providing additional administrative perks, such as filing DBAs (doing business as), which are fictitious names used when you sell products or services under a business name different from your official LLC name.
Stay compliant with a qualified registered agent
If you own an LLC, you’ll most likely be required to assign a registered agent to your business. While many states allow you to select an in-house individual to serve as your registered agent, I always recommend partnering with an outside service or agent. Third-party agents can provide your company with more security and confidentiality, and at the very least can save you from an administrative headache.
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