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 Vermont 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 registered agent. A Vermont registered 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 registered agent. How? Why? Who? Read on to find out.
What is a Vermont Registered Agent & is it Necessary?
An LLC cannot be formed or do business in Vermont without first having a registered agent on file with the Secretary of State. This is required by law and the penalties can be serious. Maintaining a registered agent doesn’t just keep you in good standing. It also provides an important service.
Think of your registered 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 registered agent service, as long as they meet the state’s requirements and consent to the appointment.
As soon as they’re appointed, your registered agent must be consistently available in Vermont to receive and act on mailed documents and service of process. Let’s take a look at what the state’s LLC Act has to say:
And the Secretary of State website expounds on the registered agent’s responsibilities:
As you can see, your registered agent is important! So don’t ever let your LLC go without one. If you go without one for more than 30 days, the state might drop the hammer and administratively dissolve your business.
What are the Requirements of a Registered Agent?
While Vermont’s registered agent rules are fairly lax, you can’t just pull anyone off the street to assume the role. An acceptable registered agent must:
- Be an individual resident of Vermont or a corporation authorized for business in the state.
- Have a physical address in Vermont (not a P.O. box).
- Have a mailing address in Vermont.
You can serve as registered agent for your own LLC if you’re okay with the added responsibilities. But an individual agent doesn’t need to be someone associated with the company – it can be a friend, family member, employee, or partner. An LLC, however, cannot be its own agent.
A registered agent’s name, physical address, mailing address, and email address are required to complete your Articles of Organization. Here’s a look at the form:
When you’ve got potential options for your registered 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 Registered Agent in Vermont?
Vermont’s registered 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 registered agent. Some LLC owners take on registered 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 a Vermont resident, your agent must not currently be establishing residency or receiving benefits in another state, even if that residency is still forthcoming.
Some smart registered 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 registered 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 registered 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 registered agent service instead.
Registered Agent Service
If safety and reliability is your goal, hire a registered agent service. A business acting as your registered agent must be either a domestic entity in Vermont or a foreign entity who has foreign qualified in Vermont.
- Privacy – Some documents delivered to your registered 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 Vermont, all registered 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 registered 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 registered agent companies offer service in most or all 50 states, so if business is booming and you decide to expand outside Vermont, 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 registered 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 Registered Agent
Here’s a pro tip: you can get the reliability of a registered 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 registered agent service.
How it Works
Hire a company like IncFile or Northwest Registered Agent to form your Vermont LLC. In addition to taking care of your Articles of Organization and other formation requirements, they will automatically include a registered agent. It’s a great two-for-one deal.
And an LLC service is pretty affordable – $125 for the Vermont 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 registered 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.
Registered Agent Changes and Resignation
You may have a wonderful registered 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 Vermont registered agent.
Head over to the Secretary of State’s Online Business Service Center. Click the “Change your Registered Agent” button and you’ll be directed to a login page. If you don’t already have an account, create one here. Once you’re logged in, follow the instructions to get your new agent on the record. Or, you can request a paper form here, which you’ll complete and submit to:
Vermont Secretary of State
128 State St.
Montpelier, Vermont 05633-1101
Both online and hard copy filings come with a $25 fee, payable by card or check.
There are a number of reasons you might need to file for a change, but the most common is a registered agent’s resignation.
Vermont law requires resigning agents to notify their LLCs when they submit their official resignation to the state. Then, they retain their duties for 40 days, unless you bring on a replacement sooner. This way, you won’t be blindsided and left without an agent for any significant period of time.
But don’t drag your feet in finding a replacement! If you take longer than 30 days to do so, the state can administratively dissolve your LLC.
Have Questions or Concerns?
This guide contains almost everything there is to know about Vermont registered agents. However, you might have a unique situation that requires additional information. Reaching out to the Vermont Secretary of State is easy, and they’ll have the answers you need. Here’s how to go about it:
Visit Their Website
The Secretary of State’s Corporations and Business Services page has a lot of great information on registered agents and LLC formation in general.
Give Them a Call
Maybe you’d prefer to reach out by phone. If so, you can call their Montpelier office at 802-828-2386.