Do I need a Registered Agent for my LLC?
What is a registered agent and do I need one?
In the United States, a registered agent is a company or individual designated to receive service of process (SOP) when a business entity is a party in a legal action, e.g. a lawsuit or summons. The term registered agent is used in most states, but you might see the terms statutory agent or resident agent as well.
In the United States, a registered agent is required for most business entities, including Limited Liability Companies (LLC’s). The exact requirements do however vary from state to state, so it is important to seek out information about your particular jurisdiction. You can contact the local authorities to find out more.
The registered agent for a business entity is usually – but certainly not always – a third party, e.g. a service company specialized in being the registered agent for companies. It is also fairly common for an enterprise to let their lawyer serve as registered agent for them.
What happens if I don’t have a registered agent for my LLC?
If you fail to designate and maintain a registered agent, your company risk loosing its LLC status and this can lead to a long row of legal ramifications. Your LLC can be dissolved and any certificates that your company holds may be revoked. The registered agent must have a registered office and be functioning properly.
Another problem with not having a registered agent or having a poorly functioning registered agent is that legal claims and other important documents might not reach you, which puts your LLC at risk for default judgments.
Can I be the registered agent for my LLC?
In most situations, being the registered agent for your own LLC or for an LLC where you are one of several members is allowed. Before you decide to become the registered agent, you should however consider the practical consequences of such a decision. For some, being the registered agent works perfectly without any hassle. For others, it leads to major problems. The registered agent is required to always be available during business hours to accept legal documents on behalf of the LLC.
- Are you always available in your office during business hours? If you sometimes have to leave, e.g. to help customers or carry out work in a different location, then being your own registered agent might not be a very good idea.
- Do you sometime go on vacation or visit family and friends outside bank holidays?
- Is there a chance that you will want to move your office to another state or set up a second office in another state and spend any time there?
As you can see, being your own registered agent can cause practical problems and will keep you fairly tied down to your office. If you fail to carry out the duties required by a registered agent it can lead to serious legal problems for your LLC. Being your own registered agent will on the other hand give you total control and you never have to worry about your appointed registered agent not being up to par.
Last but not least, all types of legal documents are delivered to the registered agent. If you are your own registered agent, servings and similar will arrive to your home or office where family and neighbors or clients and business associates might notice them.
