Handbook / Business structure

Registered agent: what it is, who can be one, and how to choose

When you form an LLC or corporation, the state filing asks for a registered agent. Many first-time owners have never heard the term. It is a simple requirement, but choosing well matters: the agent is the person or company that receives legal papers for your business, and missed papers can have serious consequences.

What a registered agent does

The SBA explains that a registered agent receives official papers and legal documents on behalf of your company. That can include:

• service of process, when someone sues the business
• official notices from the state, such as annual report reminders
• tax and government correspondence in some states

The agent's job is to receive documents and promptly pass them to you.

Who needs one

According to the SBA, if your business is an LLC, corporation, partnership or nonprofit corporation, you'll need a registered agent in your state before you file. Sole proprietors who have not formed an entity generally do not.

The SBA also notes the registered agent must be located in the state where you register. States typically require a physical street address, not just a PO box, and availability during normal business hours. Check your state's exact rules.

Your options

Act as your own agent. If you live in the state and meet its requirements, you can usually name yourself. It costs nothing extra, but:

• your address may appear in public records
• someone must be available at that address during business hours
• you could be served with legal papers at home or in front of clients

Name someone you trust. A business partner, family member or your accountant or lawyer, if they agree and meet the requirements.

Use a registered agent service. A company that acts as your agent for an annual fee. The SBA notes many business owners prefer this. Benefits include privacy for your home address, reliable availability and, often, compliance reminders.

Choosing a service

Compare:

• annual price and what is included
• how documents are delivered to you, and how quickly
• whether they send reminders for annual reports
• coverage in other states, if you expand
• reviews and how long they have operated

Avoid services that pressure you into unnecessary add-ons.

Privacy

Formation documents are usually public. If you work from home, a registered agent service can keep your home address off the state's public record for the agent role. Other parts of the filing may still require addresses, so check your state's forms.

Doing business in other states

The SBA explains that if your LLC, corporation, partnership or nonprofit corporation conducts business activities in more than one state, you might need to register in those states too, called foreign qualification. Each state where you register usually requires its own registered agent.

Changing your agent

You can change your registered agent by filing a change form with the state, usually for a small fee. Update it promptly if you move or your service changes. If the state cannot reach your agent, your business can fall out of good standing.

What happens if you miss documents

If legal papers are served on your agent and not acted on, the business could miss a court deadline and face a default judgment. If state notices are missed, you could miss annual reports and lose good standing. Choose an agent who will reliably forward everything, and act quickly when documents arrive.

Keep it in your records

Note your agent's name, address, contact details and renewal date in your business records, along with your state filing number. Add the renewal date to your calendar alongside your annual report.

Questions to ask yourself

• Am I comfortable with my address in public records?
• Will someone always be available at the address during business hours?
• Do I travel often or work at client sites?
• Do I plan to register in other states?

If any answer points to a problem, a registered agent service is usually worth considering.

Documents you receive

When your agent forwards a document, read it the same day. Note any deadlines, and contact a lawyer promptly if it is a lawsuit or legal notice.

LLCs, corporations and partnerships need a registered agent located in the state; you can serve yourself if you meet the rules, but a service adds privacy and reliability, and every state you register in needs one.