Why do I need a Registered Agent Service for my LLC?

A legal requirement for setting up an LLC is listing a registered agent. Each state has slightly varying legislations around Registered Agent services, which you must study before setting up your business.

However, fundamentally, registered agents perform a similar role of being legal intermediaries between your business and the state. In this article, we’ll consider everything to know about registered agents and why you need them for your LLC.

What Is Registered Agent for LLC?

A registered agent for LLC (Limited Liability Company) is listed on the company’s documentation during registration to receive legal documents on behalf of the company and promptly relay them to the owner.

Examples of documents an LLC registered agent can receive on your behalf include; tax notices, subpoenas, regulatory information and other state/legal correspondence.

The role of the registered agent is important because many state and federal jurisdictions still serve lawsuits in person. Your LLC needs a designated receiver whose name and address will be available to the public.

So, getting the right registered agent for your business is important to avoid skirting some state laws.

 A registered agent performs the core function of receiving documents on the company’s behalf.

What does a registered agent do?

When it’s time to start your company, you need a registered agent. A registered agent for business entities performs the core function of receiving documents on the company’s behalf.

Upon receiving the document, the registered agent must hand it to the appropriate office as soon as possible. The documents referred to here – subpoenas, lawsuits, notices, etc. – all have strict deadlines. So, it’s vital to hire an LLC resident agent.

The agent is required by law to be based in the same state as the business. Registered agents are also required to be available and reachable during working hours. For this reason, not everyone qualifies to be your LLC’s registered agent.

What qualifies someone to be a Registered Agent?

Each state may have some tiny peculiar requirements for who can be registered as an LLC agent. But, generally, to be an LLC agent, the following conditions must be met:

• Physical Office Address: A registered agent needs to be physically active in the state where your business is located. They must have a physical address that can be visited (not just a P.O. Box address). They must also be available during standard work hours.
• State-approved: If the registered agent in question is a firm (and not an individual), they must be approved to do business in the state.
• Must be an adult: One can only be a registered agent when they are above 18 years old.

Understand that your business cannot be its registered agent. So, the resident agent of the LLC you list can be your partner, employee, friend, yourself, etc.

But, as with most things in the business ecosystem, it’s better to work with professionals. So, consider the details of the bullet points above before hiring anyone or a firm.

Why you need professional Registered Agent Services

Even though getting a friend or partner to be your registered agent for LLC will cost you nothing, it’s not the best. Whether you want to start a small business, or you have a hefty investment to start big, here are some reasons to pay for registered agent services:

Privacy

The details of any registered agent you list will be available in the public domain. So, there’s nothing like privacy for these agents. Having the name of your friend or partner on such a listing eliminates privacy. Numerous evildoers are out there; it’s not worth putting yourself or your loved ones at risk.

With a registered professional agent, you don’t have to worry about such.

Embarrassment

In the business world, branding is everything – both external and internal. As an employer, you want employees to be at their best. However, it does not look good when you suddenly get lawsuits or subpoenas handed to you at a company-wide meeting. This can set off a ripple of speculations that will distract employees and make them think something is wrong.

Also, the embarrassment can be external if the state’s messenger pops up while you discuss important business with a client.

When you have a registered agent as a buffer, they know the best time to hand such documents to you.

Promptness

Professional registered agents receive state messages for a living. As such, you’ll be able to respond promptly and take the necessary actions. So you can be sure that no lawsuit, subpoena or correspondence will be lost in an array of junk mail.

Functioning in multiple states

Growth is an important aim for small businesses – which means being available in multiple locations. So, you need registered agent services approved in the various states in which your company is operational. It’s not smart to list different registered agents for each state your business is registered.

So, all you need to do is check how wide a registered agent‘s coverage is before signing them on. 

Frequently asked questions

Who needs a registered agent?

Every formal business needs a registered agent, except sole proprietorships and partnerships. You need to have an LLC resident agent in each state your business operates.

Can a registered agent use a virtual address?

No, virtual addresses are not accepted for registered agents. Agents need a physical address that can accept mail and can play host to messengers.

Will I receive a penalty for not having a registered agent?

If you don’t have a registered agent, there are some drawbacks. First is that you won’t receive important information from the government. Such important emails may get lost in the myriad of other post mails.

In extreme scenarios, not having a registered agent can cause the government to suspend your company’s operational rights.

When is the best time to hire a registered agent?

As a business owner, if you’re always traveling, it’s best to hire a registered professional agent. Also, if you run your company remotely, get a registered agent. Also, as your company continues to grow, getting a professional for the job becomes imperative – if you’ve been handling it on your own.

What is a statutory agent?

They are also known as registered agents. Some states prefer to refer to registered agents as statutory agents.

Conclusion

Having a competent individual or firm be your LLC’s registered agent is important. As simple as the job duties sound, they play important roles in organizational operations. So, if you’re convinced you need a professional LLC registered agent for your business, check out our recommended list of registered agent services.