When you envision your LLC’s future, it’s likely dreams of big deals and bigger paydays, or of catalyzing positive community change, or of pages upon pages of satisfied customer reviews. You probably aren’t fantasizing about handling paperwork or dealing with lawsuits.
But you can’t have the former without the latter. Placing value on all the nitty-gritty details like filing deadlines are what makes your business successful, which is why your registered agent is so important.
Registered agents are a vital part of the American business landscape these days, as every business entity in the country needs to designate one. However, we often hear specific questions about registered agents. Is it required to form the business initially, or it something that can be added later? Why do I need one? What if I don’t have one?
This article will serve as a kind of FAQ guide to registered agents, offering all the important details your LLC needs. We’ll walk you through how to designate your registered agent and everything that comes with the office, then tackle some important questions.
Quick Tip: If you haven’t yet formed an LLC, you can hire an LLC formation service like IncFile or Northwest Registered Agent. They’ll register the business on your behalf and act as your registered agent for one year free.
What Does a Registered Agent do?
A registered agent is vital for any business entity based in the United States. This is the person or business that is in charge of receiving documents from the state government – including service of process, compliance filing reminders, tax forms, and the like – then forwarding them on to you.
In fact, designating a registered agent is one of the first and most important steps in the business formation process. It’s a legal requirement that must be completed before starting your limited liability company (LLC), as the “Articles of Organization” form you’ll fill out to create your LLC requires your agent’s name and address.
Without a registered agent on file, the government won’t have anywhere to send your crucial and time-sensitive documents. Imagine being served with a lawsuit but not hearing about it until after the proceedings have ended, leaving you no opportunity to defend your LLC. Or, consider missing your filing deadlines because you were unaware they existed. Not good, right? This is why a registered agent is so important.
Is a Registered Agent Required?
Yes. Registered agents are required to form an LLC in all 50 states, so there’s no escaping it. Not that you would want to, of course, because your agent is just as much a benefit to you as it is to the state.
Without a registered agent, you won’t receive notifications that pertain to your business. This can include annual report notifications, lawsuits (Service of Process), and state/federal notifications or compliance reminders.
Try going without one and here’s what will happen:
- Your LLC can be dissolved by the state for not maintaining good standing.
- You won’t receive potential Service of Process and a court can come to a conclusion without you present.
Those are pretty severe consequences. Fortunately, you can easily avoid them by designating an agent right away.
When Do I Designate a Registered Agent for My LLC?
While each state has its own set of rules and regulations for the LLC formation process, in general you will need to designate a registered agent in the formation document itself. Most states call this the Articles of Organization, and it’s where you list some key details about your business, including the identity and address of your registered agent.
If you fail to include a valid registered agent on your Articles of Organization, the state will reject it or deem it incomplete. What’s so bad about that? You can’t conduct any business until you successfully file your formation documents (among other things), which means it can’t earn any income until you’ve declared a registered agent.
What are the Registered Agent Requirements?
Before we go any further, let’s go over the typical registered agent requirements so that you don’t list an invalid agent on your documents. These requirements vary between states, so
we strongly recommend that you get in touch with your formation state to find out if they have any additional specifications.
But in most cases, your registered agent must:
- Be at least 18 years old (if an individual)
- Be present at the provided address for all standard business hours on every weekday
- Be located within the same state as the LLC
That’s about it! Most states don’t impose a long list of rules surrounding registered agents, so you’ll likely have plenty of choices. As long as your registered agent fulfills those three guidelines, they should be good to go ― and that includes you. If you would like to serve as your company’s own registered agent, you’re more than welcome to do so, provided you don’t mind taking on the added responsibilities.
But just because someone can be a registered agent doesn’t mean they should. Certain individuals and companies are better-suited for the role, and who you choose depends largely on your business type, size, goals, and structure.
Can I Be My Own Registered Agent?
In short, yes, most states allow it. And as a bonus, it’s totally free. There are only a few states that don’t allow you to serve as your LLC’s own registered agent. But if you choose to take this route, think it over carefully, and be aware of a few potential drawbacks:
- Your personal address will likely be publicly available, which is frustrating from a privacy perspective.
- You’ll need to be present at your registered address during all standard business hours.
- If you’re served a lawsuit at your address, your family, customers, or employees could witness it, which isn’t the end of the world, but it is embarrassing.
Who Should Be My LLC’s Registered Agent?
Let’s cut to the chase: we don’t typically recommend appointing yourself as your LLC’s registered agent. But that’s not to say there are zero advantages to it. First off, by not hiring someone else, you can save some money. Second, if you’re already required to be present at your place of business every weekday from 9am to 5pm, you can kill two birds with one stone.
However, that’s where the positives end. One of the biggest downsides is that you need a separate registered agent in each state where your business operates, so appointing yourself restricts your LLC to doing business only in its current state. Also, a registered agent needs to be available during all standard business hours, which means you can say goodbye to vacations, sick days, or out-of-office lunches.
And imagine this, if you will: a government official shows up on your doorstep, stands on your festive welcome mat, and serves you with a lawsuit while your family and/or employees look on. It’s an embarrassing situation, and one you’ll likely want to avoid. Plus, keep in mind that a registered agent’s address is public record. Do you really want your home address in the public record? Probably not.
2) A Lawyer or Accountant
This is another popular option, and for good reason. You already do business with your lawyer or accountant, they know the ins and outs of your LLC, so why wouldn’t you trust them to take on additional responsibilities? On the surface, this might seem like a good idea, but it has a downside as well.
Lawyer and accountant rates for registered agent services are often quite high, especially compared to professional registered agent services that cost hundreds of dollars less. Furthermore, your attorney or CPA may not have much (if any) experience serving as a registered agent, so you would need to guide them through the responsibilities.
Finally, this option runs into one of the same problems as appointing yourself: it confines your business to its current state. Most lawyers and accountants only hold offices in one state, so they couldn’t serve as your agent if you expanded elsewhere.
3) A Professional Registered Agent Service
If you ask us, this is by far the best option for a majority of our readers. A professional registered agent service is almost always cheaper than hiring a lawyer or accountant, and most of them have offices in all 50 states, so it won’t hinder your expansion plans at all.
Registered agent services are experienced and knowledgeable about handling agent responsibilities. This is their specialty, and they know their way around it better than most individuals. It’s not a secondary line of business like it would be for an attorney or accountant ― being a registered agent service is at the core of what these businesses do every single day.
The more difficult question is which one to choose. A quick Google search will reveal that there are quite a few registered agent service providers out there, and it can be tricky to discern how they differ from each other. But we put in the work for you. We’ve spent hours researching registered agent services, weighing the pros and cons, then analyzing and ranking the best options.
Two of our favorites ― IncFile and Northwest Registered Agent ― each provide a full year of registered agent service when you hire them to form your LLC. If you’ve already formed your business, these other factors might be more important to you:
Northwest – $125/year
IncFile – $119/year
Northwest – Customized, one-on-one assistance from a dedicated representative
IncFile – Quality support, but not as personalized as Northwest
Northwest – Small volume of feedback, but strong review scores
IncFile – Thousands of reviews with high rating scores
You really can’t go wrong either way. If personalized customer support is your priority, give Northwest a look. But if you place a high value on reviews, IncFile should be a solid fit.
Why We Recommend a Registered Agent Service
Handling registered agent duties can be exhausting, and when you’re planning out a new business, you’re probably exhausted enough. Hiring a registered agent service lets you hand off those responsibilities without giving it a second thought so you can focus your energy where your passion lies: starting and growing your business. Yes, it’s an added expense to what’s likely a growing list of costs, but these three benefits are totally worth it:
- You’ll be adhering to state laws that require having an agent on file.
- Your service will immediately scan and notify you of any correspondence related to your LLC, keeping it compliant and protected.
- Your personal address won’t be publicly available because you can use their address instead.
- Any Service of Process for your LLC will be delivered through the registered agent service, rather than at your home or office.
Peace of Mind
- Rather than being confined to your registered office between normal business hours (9am-5pm), the registered agent service will be available for you, so you can have a nice coffee out or leave for a long weekend whenever you’d like.
- The documents and notifications you receive will be stored in a secure online dashboard for safekeeping, like a backup.
How to Get a Free Registered Agent
You’ve likely heard it said that nothing is truly free, especially in the business world, but there are two bonafide ways to get free registered agent service. They may require the purchase of other business services, but your specific registered agent service will be 100% free of charge. If you’re out there looking for loopholes that will let you save some money (legally, of course), here they are.
Serve as Your Own Registered Agent
This is the more obvious option, but while it’s completely free and there’s no legal argument against it, this route might not be the best solution for everyone.
In other words, if you plan on taking vacations or sick days, this option is not for you. However, if you’re willing to commit to being physically present there every day during standard business hours ― or if the demands of your business require you to be there anyway ― why not multitask and act as your own registered agent?
Of course, as we mentioned earlier, you won’t be able to step out for lunch or leave during the day for other reasons, you’ll be restricted from expanding into other states, and you might be served with lawsuits at your home address. But if saving money is your top priority, or if you’d rather maintain tight control over your LLC’s state correspondence, this could be a great option for you.
Free Registered Agent Service With Purchase of LLC Formation
If you’re considering a registered agent company and you haven’t yet formed your LLC, you’re in luck. Certain service providers will give you a year of registered agent service at no extra charge when you hire them to form your limited liability company or corporation.
As a matter of fact, our top two picks for the best LLC formation services both provide 12 months of registered agent service as a free bonus when you hire them to form your company, one of the major reasons they stood out to us.
Northwest is a reliable, trustworthy company that specializes in LLC formations and top-notch registered agent service. For $79, they’ll form your LLC with your state government, serve as your registered agent for one year, and provide their customized premium customer support. After that first free year, their registered agent service costs $125 per year.
Our other top pick, IncFile, is a free LLC formation service. Also like Northwest, they’ll form your business and throw in a year of registered agent service. They don’t offer the same level of personalized customer support as Northwest, but IncFile counters that attribute with thousands of overwhelmingly positive customer reviews. If you want to continue receiving registered agent service from Incfile after the free 12 months, their annual fee is $119.
5 Important Registered Agent Myths
By now, you’re basically a registered agent expert – or at least a well-informed entrepreneur. Still, there are a lot of registered agent misconceptions floating around out there. Make sure your business doesn’t fall victim to any of the following myths:
1) Each business only needs one registered agent
This one is partially true, but only if your LLC operates in just one state. If you execute business transactions in multiple states, or if you want to expand your operations into a new state, your company needs to have a registered agent in each of those states. Most major registered agent services provide service in all 50 states, but if you serve as your own agent, designate an attorney or accountant, or hire a friend or family member, this could cause some problems.
2) It’s easy and practical to serve as your own registered agent
Some business owners successfully serve as their own agents, but the idea that “anyone can do it” simply isn’t true. It requires a thorough knowledge of state guidelines, compliance deadlines, and service of process. Plus, individual agents need to be diligent and dedicated, remaining at the place of business during all regular business hours. Missing state communications or court summons isn’t something you want to risk, so if you’re unsure about the responsibilities, we recommend handing them off to a professional service.
3) Professional registered agent service is costly to acquire and maintain
In reality, hiring a professional registered agent is quite affordable, especially compared to the expense of some other business services. While prices fluctuate from company to company, in general you can find options for around $10/month or less.
4) It’s not necessary to keep official notices from your state government
This isn’t necessarily a legal requirement, but it’s a good business practice that can save you a lot of trouble in the future, so we strongly recommend it. Any reputable registered agent will hold onto official government notices ― whether they’re for annual reports, tax forms, etc. ― or at least keep a digital record of the delivery. It’s important to be vigilant about keeping records regarding deadlines with your state so you can easily maintain your good standing.
5) Registered agent service is basically just mail sorting
Sorting through junk mail is the least glamorous and most tedious part of a registered agent’s job, but this is just one small aspect of registered agent service. The key aspect of this role is to contact business owners as quickly as possible if the state sends service of process, and also to help keep that business compliant and in good standing.
Have a few registered agent options in mind? Great. It’s a good idea to carefully evaluate each one to ensure that whoever you appoint is a good match for your business circumstances.
Technically, there are a lot of choices, but it’s pretty clear that some of the options are better than others. With a professional registered agent service, you’ll never have to worry about having your expansion plans limited, missing important document deliveries, or paying too much.
If you want our advice, go with a registered agent service. The benefits they provide and the peace of mind they offer vastly outweigh the annual price you’ll pay, and we’re sure you won’t regret it. Once you have a registered agent in place, you can continue doing what you love, striding forward toward future business success.