What is a Registered Agent and Why You Need One

If you’re starting a business, you’ve probably heard the term “Registered Agent.” But what exactly is a Registered Agent, and why do you need one? Let’s break it down.

The Role of a Registered Agent

A Registered Agent is a person or company designated to receive official documents and legal notices on behalf of your business. These documents can include important communications from the state, tax notices, or even legal papers if your business is sued. Among all those, receiving a lawsuit is the most important reason to maintain a valid Registered Agent.

Every registered business entity must maintain a Registered Agent for their business. And if you register your business entity in other states, you must maintain a Registered Agent in those other states also.

Who Can Be a Registered Agent?

A Registered Agent can be an individual or a professional service. Here are your options:

• Yourself: You can serve as your own Registered Agent if you have a physical address in the state where your business is registered. This can be a good way to save money, but it does come with responsibilities and it will be published in a public database (forever).
• A Trusted Person: You could designate a friend, family member, or trusted colleague to be your Registered Agent, as long as they have a physical address in the state and are available during business hours (but again, this information will be published in a public database).
• Professional Service: Many businesses choose to hire a professional Registered Agent service. These services specialize in handling legal paperwork, ensuring that nothing falls through the cracks (in this case, their information will be published in the public databased rather than your information).

You Versus a Service: Pros and Cons

When deciding whether to be your own Registered Agent or hire a professional service, consider the following pros and cons:

Being Your Own Registered Agent

• Pros:
  • Save Money: You avoid the cost of a professional service.
  • Direct Control: You receive all documents yourself.
• Cons:
  • Availability: You must be available during business hours to receive documents.
  • Privacy: Your address becomes public record.

Using a Professional Registered Agent Service

• Pros:
  • Reliable: Always available during business hours.
  • Privacy: Keeps your personal address off public records.
  • Compliance Help: Offers reminders to stay on top of filing requirements.
• Cons:
  • Cost: Professional services come with fees.
  • Less Immediate Control: You may not receive documents directly, but most services notify you promptly.

Final Thoughts: Do You Need a Registered Agent?

Yes, if you’re forming an LLC or corporation, you definitely need a Registered Agent. Whether you decide to be your own or hire a professional service depends on your specific needs and how much time you can dedicate to managing official documents.

A Registered Agent is an essential part of keeping your business compliant and ensuring you never miss an important notification. If you’re unsure which route to take, consider reaching out to an entrepreneurial attorney for personalized advice.

(This article is general in nature and is not legal advice.)