When you create an LLC or corporation, one important choice is to pick a registered agent. This person or company serves as the primary point of contact for your business with legal and government authorities.
While most states allow you to be your own registered agent, there are some downsides to consider.
Find out what a registered agent does, the risks of choosing yourself or someone in your company for this role, and how using a registered agent service can help.
The role and responsibilities of a registered agent
While states require that LLCs and corporations have a registered agent, agents are also key to ensuring your business stays compliant and informed.
A registered agent is your business’s main contact. They receive important official letters from the state and handle legal documents that start a lawsuit against your business.
Below is a breakdown of the duties of a registered agent:
- Accepting legal documents: A registered agent accepts legal documents on behalf of your business, including lawsuit notices, wage garnishments, and court orders.
- Handling official government correspondence: Such as tax forms and compliance reminders.
- A point of contact for state authorities: Because they must maintain a physical address in the state of registration and be available during regular business hours, a registered agent is a useful point of contact for authorities.
- Relaying critical documents: A registered agent forwards essential documents to your business. Without one, official documents may not reach the right person on time.
Who can be a registered agent for an LLC or corporation?
A registered agent must be a company or an individual over 18 years of age. To be a registered agent, the entity or person must meet the following criteria:
- Have a physical street address in the state where the business is registered (P.O. boxes are not permitted).
- Be present at that location during regular business hours to receive legal documents.
- If an individual is a resident of the state where the business is registered.
- If a company is legally permitted to operate in that state.
Note: Some states have extra rules for serving as a registered agent. In Virginia, for example, not everyone can take on this role. Only attorneys or members of the corporation’s management can be registered agents.
Can a registered agent be the owner of the business?
A business owner can be their own registered agent if they meet state rules. This includes being available at a physical address during business hours to receive legal documents. Remember, the registered agent's address is public information, so anyone can see it.
What are the risks of being a registered agent?
Appointing an owner, officer, or employee of your business as the registered agent comes with certain risks, including:
- Availability issues: If your business misses important documents because the registered agent is traveling or on vacation, you could face missed deadlines, fines, and penalties.
- Inaccurate information: If the person designated as the registered agent changes offices, leaves the company, or moves to another state, you must update their name and address with the Secretary of State. Failure to do so can result in missing important notices about lawsuits. There are also legal penalties for failing to keep the registered agent’s information current.
- Mishandling or overlooking Service of Process: There is a risk that documents may be left with someone else at the office or signed for by an unauthorized person. This can result in neither the registered agent nor legal counsel receiving notice of a lawsuit in time to respond appropriately.
- Operating outside standard business hours: Your registered agent must be available during standard business hours at a fixed location to receive Service of Process and other important documents. If the registered agent is unavailable, many states allow lawsuits to proceed through substituted service. However, this method of service does not always ensure that your business is notified of the lawsuit, which could prevent you from defending it.
- Loss of privacy: The registered agent's address becomes part of the public record, meaning your home or business address may be exposed to the public, marketers, or anyone searching state records.
- Reputation concerns: The delivery of Service of Process, often done by local law enforcement, can be uncomfortable for business owners, especially if police officers show up in front of customers or employees.
- Complications across state lines: If your business operates in more than one state, you must register with each one. Each registration requires a registered agent with a physical address in that state.
These risks can have serious consequences. For example, if a court rules against your business and you fail to respond to a lawsuit on time, you may be subject to a default judgment.
What is a registered agent service?
A registered agent service is a professional third-party provider that handles the registered agent responsibilities for your business. Instead of relying on someone in your company to do this, you can use a service that specializes in receiving and managing legal and state documents.
If you oversee multiple businesses, a registered agent service provides reliable support, coverage in all states where you operate, and an easier way to track important papers and deadlines. This service also frees up your staff from administrative work and lowers the chances of missing important filings, lawsuits, or deadlines while traveling or during staff changes.
When evaluating a registered agent service, consider the following:
- Multi-state coverage and compliance expertise: Choose a provider with physical addresses in every state where you do business. They should know each state’s rules and deadlines for LLCs, corporations, and partnerships.
- Availability and reliability: Ensure they have a staffed physical location (not just a P.O. box) during regular business hours and a reliable process for receiving and quickly forwarding legal documents.
- Easy, secure, online document management: Look for a partner that offers a secure online portal, real-time alerts for legal notices, and audit-ready logs that give you visibility into your compliance status.
- Support when you need it: Good customer support makes a difference. Fast responses and direct access to helpful staff, or even a dedicated account manager who knows your business, can provide peace of mind.
- Long-term partnership potential: Seek a partner who offers more than registered agent services. One who can act as a compliance partner as your business scales and grows. Services to look for include formation support, business licensing, and entity management.
Conclusion
Choosing a registered agent is a crucial decision for your business. Acting as your own registered agent can be complicated and risky.
But with the right partner, you can protect your business from missed deadlines, legal surprises, and compliance risks—while making it easier to manage growth across multiple states. Take the time to assess your options and choose a provider that fits your long-term business goals.
For more information, see our Registered Agent Services.