What this is – A registered agent isn’t just a perk – it’s a mandate by the state in most cases. But you can’t hire just anyone to perform this service.
What this means – If you need a registered agent, there are definitely pluses and pitfalls to maintaining a professional relationship. These are some of the most important things to look for.
A registered agent is a business or individual designated to receive and forward legal documents such as Service of Process or notices from the state. The purpose of the registered agent is to provide a legal address where someone will be available during normal business hours to receive these notices and documents. Unlike some other responsibilities, in most jurisdictions in the United States, this is not a “nice to have”, but is a mandate by the state in which the entity is doing business. Failure to maintain a registered agent can have a negative impact on the business, including penalties or even revocation of the company’s authority to do business in the state in some cases.
While some businesses opt to have an officer or employee serve as the registered agent, many choose to designate a company that specializes in providing registered agent services. This choice may be especially beneficial when the company is doing business in several states and is not able to ensure that staff in a particular location will always be available during normal business hours to receive these documents.
But what are the responsibilities of a professional registered agent? What will they do for your business and, equally important, what should they not do? Here are a few of the do’s and don’ts to keep in mind when working with a registered agent:
What You SHOULD Do When Working With a Registered Agent
- DO notify the registered agent if you are filing the formation or qualification documents yourself. In a number of states, a registered agent can be selected without any approval by or notification to the agent. Make sure you take the step to notify the agent so any legal documents received on your behalf are sent expeditiously to the correct contact for your business. Missing an important response date because you didn’t receive the service of process could subject your company to a default judgment.
- DO provide current contact information so your registered agent can send legal documents in a timely manner. Most agents will email and/or send legal documents via an overnight service. Often, the registered agent is overlooked when there is a change of address or contact information. Make sure your registered agent receives any changes in contact name or physical and email addresses so costly delays are avoided.
- DO provide jurisdiction-specific information (e.g., Delaware Communications Contact). Some states require the name of a “natural person” to be designated to receive notices. It is important that you provide your agent with the name of an individual rather than “accounting” or “legal department”. The registered agent has a responsibility to maintain this information, and in some situations may need to resign if it is not provided.
- DO pay the invoice. It is not uncommon for an invoice to be overlooked or put aside if the individual receiving it is not certain of what it is for. This may result in the registered agent “resigning” with the state, which could result in penalties or legal documents not being forwarded.
- DO reach out if you receive state filing solicitations that appear to be questionable. While some annual report notices are entirely legitimate, you should be on the lookout for misleading compliance solicitations. If you receive any notices that do not look to be from the state or request you send a fee much higher than you are accustomed to, do not hesitate to contact your registered agent who can investigate the legitimacy.
What You SHOULD NOT Do When Working With a Registered Agent
- DON’T assume your registered agent will automatically file annual reports and other tax documents on your behalf. While the agent will forward any notices received from the state, it is your responsibility to file the report. Some states do not forward reminder notices and others may forward notices only very shortly before the due date. If you need help managing the due dates, consider asking your agent if they have a tool for tracking report due dates. If you prefer to outsource the responsibility for annual report filings, many agents will be able to automatically file reports on your behalf for an additional fee.
- DON’T use your registered agent’s address as a business or personal address without consent. Some entities do not realize that a registered agent’s address is only for legal documents and notices. Are you expecting license tags or having a package sent to the business address? Make sure the agency or vendor has your physical address for shipping purposes.
- DON’T forget that your registered agent may be able to provide more than just an address for service of process (e.g., assist in managing your entities’ registrations, annual reports, charitable registrations, business licenses, etc.). If you have any questions about what your agent can or cannot do for you, just ask.
Following these simple tips will help ensure you receive timely notification of any legal documents or notices that need to be addressed allowing you to focus on the important job of managing your business!
Do I need a registered agent for international business?
In most countries, corporations are required to seek out international registered agent services to appoint a registered agent and registered office to receive and respond to local legal documents (service of process, writs, summonses), tax information and compliance communications. You can find out more about hiring international registered agents here.
Can I change my registered agent?
Things happen. Relationships change. Sometimes you may find that your registered agent just isn’t doing it for you. If you’re dissatisfied with the registered agent that was appointed when you formed or expanded your business, you have the freedom to choose. Short answer – yes, you can change your registered agent.
Do I need more than one registered agent?
Companies and nonprofits are required by law to appoint registered agents and offices for every state they’re located in, to receive and respond to sensitive legal documents (service of process), tax information, compliance communications and more. Organizations that operate in multiple states often choose to appoint a national registered agent company. When your company was formed, your registered agent may have been chosen for you, without you understanding the details.
This article is provided for informational purposes only and should not be considered, or relied upon, as legal advice.