Think of all the people you communicate with regularly to run your LLC. Business partners, employees, banks, lawyers, and financial advisors all probably come to mind. But what about the state? It may not be at the top of your list, but running a successful LLC in Ohio requires consistent interaction with the state.
Formation documents, business information changes, lawsuits, professional licenses, and Annual Reports – all of these (and more) require you to work with state agencies. The good news is that you don’t need to do it yourself.
Introducing the statutory agent. An Ohio statutory agent is an intermediary for your LLC, a person or company that handles your communication with the state. They’re a vital part of any LLC’s success. Before you file your Articles of Organization, you’ll need to have a designated statutory agent. How? Why? Who? Read on to find out.
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What is an Ohio Statutory Agent & is it Necessary?
An LLC cannot be formed or do business in Ohio without first having a statutory agent on file with the Secretary of State. This is required by law and the penalties can be serious. Maintaining a statutory agent doesn’t just keep you in good standing. It also provides an important service.
Think of your statutory agent as your ambassador to the state, handling all your LLC’s important legal, tax, and compliance information. This can either be an individual, company or statutory agent service, as long as they meet the state’s requirements (see below) and consent to the appointment by signing the Original Appointment of Statutory Agent form (included with the Articles of Organization).
As soon as they’re appointed, your statutory agent must be consistently available in Ohio to receive and act on mailed documents and service of process. Here’s what the Secretary of State specifically says:
Don’t slip up and go without a statutory agent for any amount of time, because the state isn’t messing around. Spend more than 30 days without a valid agent on file and your LLC can be administratively dissolved.
What are the Requirements of a Statutory Agent?
Your options for a statutory agent are broad and far-reaching, as Ohio only has two restrictions on who you can choose. As you decide on an agent, confirm that they:
- Are an individual Ohio resident or a corporation authorized for business in the state.
- Have a physical mailing address in Ohio (P.O. boxes are not allowed)
If you think you have a good grip on the statutory agent’s job and responsibilities, you can even appoint yourself.
Regardless of who you choose, you will need to include their information to complete your Articles of Organization. Here’s what you’ll see on the Original Appointment of Statutory Agent form, which you must submit along with the Articles of Organization:
But the state won’t let you submit this without consent from the individual or company being appointed. It also requires the agent’s signature:
When you’ve got potential options for your statutory agent, review each one to make sure that they meet these requirements. If they do, you’re good to go! If not, you’ll need to keep looking.
Who can be a Statutory Agent in Ohio?
Ohio’s statutory agent requirements are pretty broad, so you’ll have no shortage of options. On top of that, your agent can be either an individual or a professional service. But think carefully before choosing, because each option has its own pros and cons. Let’s take a closer look.
You may choose to appoint a single person as your statutory agent. Some LLC owners take on statutory agent duties themselves. Others appoint one of their partners or managers. Some will even appoint a family member. As long as the proposed agent fulfills the state’s requirements, they’re a valid option.
In addition to being an Ohio resident, your agent must not currently be establishing residency or receiving benefits in another state, even if that residency is still forthcoming.
Some smart statutory agent choices include attorneys, accountants, or other LLC partners, people who understand the ins and outs of business operations.
- Convenience – Having familiarity and mutual trust with your statutory agent is extremely beneficial, and appointing an acquaintance can provide both. Plus, you’ll always know how to contact them.
- Cost – Hiring someone you know often won’t cost a dime. It’s certainly cheaper than a professional service.
- Scheduling – Part of a statutory agent’s duty is being consistently available to receive mailed documents and service of process. If your agent goes on vacation or moves out of state, it will throw a wrench in your plans.
- Punctuality Risks – Some state communications and filings are very time-sensitive. If your agent is unavailable when documents are delivered, it could slow down the entire process and put you at risk for late fees and penalties. Even worse, a friend or family member could lose or misplace a document. So if you’d rather not interrogate Aunt Louise about the location of a particular tax form, you might consider using a statutory agent service instead.
Statutory Agent Service
If safety and reliability is your goal, hire a statutory agent service. A business acting as your statutory agent must be either a domestic entity in Ohio or a foreign entity who has foreign qualified in Ohio.
- Privacy – Some documents delivered to your statutory agent will contain sensitive information. Do you want details about your lawsuit or taxes lost out there in the world? Definitely not. A friend or family member might misplace these documents, but a professional service will not. Plus, in Ohio, all statutory agent names and addresses are available to the public. This might make an individual uncomfortable, but hiring a company will keep this personal information off the record.
- Reliability – Handling and processing time-sensitive documents is a statutory agent service’s specialty, its area of expertise, its main game. Hire a professional service and you can be sure that your filings will be submitted properly and punctually, so you’ll never have to deal with late fees or other penalties.
- Location – Many statutory agent companies offer service in most or all 50 states, so if business is booming and you decide to expand outside Ohio, you won’t need to find a new agent for each state.
- Cost – There’s no getting around it – hiring a service costs more than appointing an individual who’s willing to do it for free. However, for a reasonable price (roughly $100/year), you’ll receive premium services. Taking your car to a mechanic costs more than letting your neighbor try to fix it, but the mechanic gives you peace of mind that the job will get done right, and that may very well be worth the cost.
All of the other steps in the LLC formation process will keep you busy, but take some time to ensure you find a statutory agent that fits with your business model, goals, and values. Do this, and your LLC will reap the benefits for years to come.
How to get a Free Statutory Agent
Here’s a pro tip: you can get the reliability of a statutory agent service and the cost-effectiveness of an individual. The best of both worlds. When you hire certain LLC services to start your business, they’ll throw in free statutory agent service.
How it Works
Hire a company like IncFile or ZenBusiness to form your Ohio LLC. In addition to taking care of your Articles of Organization and other formation requirements, they will automatically include a statutory agent. It’s a great two-for-one deal.
And an LLC service is pretty affordable – $99 for the Ohio LLC formation fee, plus a $49 or $79 service fee. That’s great value for the number of benefits you receive. Some services will even cover and consolidate your LLC formation costs.
Take this route and you’ll sweep all formation paperwork and statutory agent duties off your plate. Plus, to keep track of everything, these services provide user-friendly online dashboards, so you can follow everything they’re doing to keep your LLC in good standing.
Statutory Agent Changes and Resignation
You may have a wonderful statutory agent, someone who takes care of everything efficiently and who you trust completely. But you know what they say: all good things must come to an end. At some point in the life of your LLC, you may need to change your Ohio statutory agent.
You may not be thrilled to change your statutory agent, but fortunately, it’s a fairly easy process. All you need to do is submit a Statutory Agent Update form either by mail or online. This form requires the name and address for both your current and new agents. Your new agent will also need to approve the appointment by signing the form.
There are a number of reasons you might need to file for a change, but the most common is a statutory agent’s resignation.
Your agent must inform you before submitting an official resignation, so you won’t be blindsided when they move on, and you’ll have time to appoint a replacement. That said, don’t take your time in finding a new agent because the state will administratively dissolve your LLC if you go more than 30 days without one.
Have Questions or Concerns?
This guide contains almost everything there is to know about Ohio statutory agents. However, you might have a unique situation that requires additional information. Reaching out to the Ohio Secretary of State is easy, and they’ll have the answers you need. Here’s how to go about it:
Visit Their Website
Give Them a Call
Sometimes, however, it’s nicer to speak with a person. If you prefer to chat on the phone, reach out to the Secretary of State’s Columbus office at (614) 466-2655.