Should You Hire a Registered Agent or Be Your Own?

Most successful tycoons enjoy a DIY lifestyle – they love to tackle new challenges all on their own. That’s also what makes them fortunate business owners. 

Those same DIY devotees might decide to manage as much of their business on their own as they can. They will form their own business on their own, handle their own marketing plans, and they might even serve as their own registered agent.

This begs the question: is it a smart move to designate yourself as your business’s registered agent? Or should you hire one instead? In this brief post, we will answer those questions and more. 

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What does a Registered Agent Do? 

A registered agent is an agency or a person your business appoints to receive official notices on your corporation or LLC on your behalf. This includes correspondence with the state, service or process, and notifications about state and federal taxes. 

In this case, your registered agent for service of process can be anyone – an employee, the business owners, or an outside service or person hired to fulfill the role. 

Registered agents are particularly important for businesses that are not based in a state where they are doing business) for instance, you’re located in California but also provide or sell thin in New York). There must be a way to contact your business for legal purposes, and a designed California registered agent is the way to do so. 

Some examples of documentation that a registered agent receives on behalf of a business include: 

  • Notice of lawsuit 
  • Official federal and state correspondence 
  • Subpoenas for information 
  • Court summonses
  • Tax notices from local tax authorities and IRS
  • Business filing notifications 
  • Wage garnishments notices (when a company is required to withhold a portion of an employee’s wages and send them to a company or a person to which the employee owes money) 

Does my business really need a registered agent? 

In most states within the U.S, a company must designate a registered agent when establishing a business as an LLC or a corporation in that jurisdiction. Having a registered agent around becomes an ongoing business compliance responsibility for those companies. 

An organization that is required to have a registered agent, but fails to designate or maintain one, can face some serious repercussions. For a start-up, its qualification or formation documents to include will probably be declined by the state. Not only that, but a business that doesn’t maintain a registered agent runs the risks of penalties, fines, and possible default judgments in favour of the other party (in the event of a lawsuit). A business might even be terminated or suspended (administratively dissolved) and not allowed to conduct a business in other states. 

For instance, when you want to choose any vendor, you will want to have confidence in your registered agent’s reliability and integrity. Some things to consider when selecting a registered agent to tackle all your business legal ins and outs include: 

  • Experience in navigating the different filing deadlines and rules of different states. 
  • Reliability in maintaining copies of your important business compliance documents like Articles of Organization, Articles of Incorporation, annual reports, Bylaws, Operating Agreement, etc. 

It pays to be selective when it comes to a legal representative because that agency or person will be responsible for making sure your business gets notified of time-sensitive materials without delay. It’s imperative to have a registered agent that is trustworthy, responsive, and organized because you will rely on that source to help you maintain your organization informed and in good legal terms in the state where you operate. 

What are some benefits that come with having a reliable legal agent for your business? 

1. Compliance with the Law 

Your registered agent will help your business stay up-to-date on state requirements by sending you regular reminders for fillings.  As such, you won’t have to stress about penalties and legal feels – or worse, lose your business altogether. A professional service can: 

  • Keep copies of your business documents. In case of a natural disaster or other unexpected losses, you can rely on your registered agent to keep all your business papers. 
  • Help you find state-specific legal professionals and accountants. Almost every business needs legal assistance or accounting at some point during its formation. 

2. Privacy  

Every business must value its privacy. In that case, your agent’s address will be listed on the public record – not your office or personal address. That’s especially important to consider if your company operates out of your home.  A registered agent will maintain your privacy by: 

  • Having their email address public instead of yours means you will be less likely to receive unsolicited emails. 
  • Preventing you from receiving a lawsuit in person. Nobody wants to get served with a lawsuit in front of their employees, family, or worse, customers. 

3. Flexibility 

Say you want to be your own registered agent; in that case, you will need to be available to receive official materials during standard business hours at the address you give. However, having a registered agent around will give you the flexibility to focus on your important business matters instead of being available or keeping track of deadlines during business hours. With a registered agent, you can: 

  • Tackle important business tasks without worries. A registered agent must be available from 8 to 5 every day on weekdays. With a registered agent service, you can choose your own schedule. 
  • Form an LLC in multiple states. If your business has to maintain a physical presence in multiple states, you will need an agent for each state. 

4. Peace of Mind 

Having a reliable registered representative around will allow you to focus your time, attention, and energy on your important business matters. A registered professional agent can: 

  • Help you maintain your work-life balance. Personal and business mail is kept separate, preventing business matters from influencing your home life. 
  • Make growing your business a top priority. Essential LLC forms will be automatically received and stored for safekeeping. 

To sum it up, if you choose to be your own registered agent for your business, think again. You might decide it’s better to have a trustworthy registered agent perform all those time and energy-consuming tasks.

FG Editorial Team
The Founder's Guide Team - Asian Associates with dynamic elements out to make a change.Thank you for visiting our site! If you do have any questions or inquiry, feel free to contact us through our links and please don't forget to follow our social media accounts. It would be our pleasure to help you in any way we can. Always Remember: "Proceed to Succeed". Hoping to hear from you soon!