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Why Do I Need a Registered Agent?

When you form a company, part of the formation process in every state requires that you designate a Registered Agent (sometimes called a Resident Agent, Statutory Agent or Agent for Service of Process). The Registered Agent gives the state an official contact for your company so it can communicate important filings and changes in organization requirements. The Registered Agent is also responsible for receiving notice of a lawsuit (“service of process”) on behalf of your business.

States Require You to Designate a Registered Agent

If you’re incorporating your business or expanding your business into another state, state statutes require you to designate a Registered Agent in each state. Therefore, an organization such as a corporation or an LLC must designate and maintain a Registered Agent in the state where it is formed. A company must also do the same in any other states where it’s registered to do business.

While states vary in their exact requirements for Registered Agents, there are three rules that generally apply:

  1. The Registered Agent must be a resident individual or a domestic or qualified out-of-state corporation.
  2. The Registered Agent’s office address must be a physical address in the state. This means that a P.O. Box does not qualify as an in-state address. Some states require you to designate a “Registered Office” in addition to naming a Registered Agent.
  3. The Registered Agent must be available during “normal” business hours—nine to five, Monday through Friday.

Your Registered Agent is Your Official Contact With the State

Why do states require companies to have a Registered Agent? The state requires a Registered Agent be designated so that it has an official contact on file for your business. The state will send your company important compliance information and official correspondence through your Registered Agent. For most businesses, this correspondence is comprised of annual report and tax filing correspondence.

Your Registered Agent is also responsible for receiving service of process for your company. Service of process is legal paperwork that gives your company official notice of a lawsuit.

Having a Registered Agent is an Ongoing Requirement

You’re required to designate an in-state Registered Agent when you form your company and in each additional state in which you are doing business. And, maintaining a Registered Agent in the state in which you formed and in each state where your company is conducting business is an ongoing requirement.

What happens if you fail to maintain a Registered Agent? Failing to have a Registered Agent contact in the state in which your business was formed and in states where your business has expanded may result in serious adverse consequences. Your business can be administratively dissolved in the state of its formation and forfeit the authority to do business in other states. Continuing to do business as usual under this status means your business is not only subject to fines and penalties but may also be unable to defend itself in a lawsuit. Reinstatement of what is known as “good standing” for businesses varies state-by-state and can be a tedious—and expensive—process.

Why a Professional Registered Agent Makes Sense

If you incorporate in a state other than the state where your business is located or if you’re registering to do business in states other than where your company was formed, you’ll need to designate a Registered Agent with a physical address in the respective state. If you have a physical address in the state in which you form your company, technically you could serve as your own Registered Agent. However, there are a couple of very good reasons why just because you can serve as your own Registered Agent doesn’t mean that you should:

  1. Time-sensitive materials require immediate attention. You’re busy running your business and in almost every case that means you’re not always available during regular business hours to receive important communications that require a response by a certain deadline or due date. A professional Registered Agent is available for the receipt of official documents and will forward them to you in a timely fashion so you don’t miss important annual report, tax and litigation filing deadlines. A reliable professional Agent helps you avoid the consequences of improper handling of critical paperwork.
  2. Protecting your business image. A sign of your business’s legitimacy is your decision to incorporate—it’s a sign that you’re serious about what you do and that you intend to succeed. Acting as your own Registered Agent means keeping your business address (which may also be your personal address) on file with the state for where to send the correspondence routinely associated with corporations and LLCs. This opens you up to interruptions to your busy day, and if clients or customers are present, it can jeopardize the professional image you’ve worked so hard to project. For example, if you are served with notice of litigation, you can understand that a client or customer’s reaction won’t be favorable. You’ve taken the steps to legitimize your business and are working hard to earn the respect of clients and customers. Don’t jeopardize it all by making it seem that you need to juggle functions you can outsource that take time away from what you do best as a business.

The right Registered Agent is a partner in your success. A reliable professional Registered Agent such as CT gives you peace of mind that you won’t miss a critical filing and endanger your business’s good standing. Monitoring tools and services provide transparency as to exactly what’s going on with your business compliance so you’re always in control. With a professional Registered Agent you can count on, you have the confidence of knowing that you’re aware of and on top of your compliance obligations.

Questions? We Can Help.

Have a specific question about a product? A CT Specialist will follow up with a custom quote along with a comprehensive assessment of your needs.