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What Is Required to Become a Registered Agent?

What Is Required to Become a Registered Agent?

What Is a Registered Agent?

A registered agent—sometimes referred to as “resident agent” or “statutory agent”—receives service of process, legal documents, and important state communications on behalf of the business. Every corporation and limited liability company (LLC) must appoint and maintain a registered agent in the state of formation and in every state where it is authorized to do business.

A registered agent exists to be the hands and feet of a formal entity with respect to receiving and forwarding legal papers (Service of Process) and official state administrative notices, such as annual report notifications.  

Each state has its own rules regarding the qualifications to serve as a registered agent. In order to become a registered agent for a statutory entity (which includes limited partnerships (LP) and limited liability partnerships (LLP), as well as corporations and LLCs), an individual or a company must meet these minimum qualifications requirements. In addition, the entity must take formal action to appoint the registered agent. In many states, the registered agent must acknowledge and/or consent to the appointment.

Can I Be My Own Registered Agent?

In order to be your own registered agent, you must meet several state requirements. An individual needs to be a resident of that state in order to serve as an entity’s registered agent. In addition, he or she must have an actual physical address within the state—a post office box will not suffice.

Some states impose additional requirements. For example, in Virginia, not every resident can serve as a registered agent: an individual must be an attorney or part of the corporation’s management.  In Colorado, the individual must be at least 18 years of age. It is important to verify the requirements for each state where a registered agent is required.

There is another critical requirement to keep in mind—although not all states specifically spell out this requirement in their statutes:  registered agent must be available during normal working hours throughout the year. It may seem tempting to dismiss the “throughout the year” portion, but if the registered agent isn’t there when the process server arrives, the person filing the lawsuit may be able to obtain “substituted service”—which does not always result in the company getting actual notice of the litigation. In that case the lawsuit can still proceed—but the company may forfeit its right to present a defense. The need for year-round, full-day availability is one reason why companies opt for a professional registered agent service company, even in their home states.

Can a Corporation or LLC Serve as a Registered Agent?

All states permit certain entities, such as corporations and LLCs, to serve as registered agents for other entities.  However, these professional registered agent services must be either a domestic entity or a foreign entity that is authorized to do business in the state. In most states, an entity serving as registered agent must have a street address and office in the state that is open during normal business hours.

CAN AN ENTITY SERVE AS ITS OWN REGISTERED AGENT?

In a few states, such as Delaware and Colorado, the entity can serve as its own registered agent. However, most states do not allow the entity to be its own registered agent.

Should I Be My Own Registered Agent?

Although the requirements to become a registered agent are relatively easy to meet, there are significant responsibilities involved. Failure to perform those duties successfully can have serious adverse consequences for the business. For example, the improper handling of a service of process can lead to a company failing to respond in time, which can then result in a default judgment

What Are the Reasons for Using a Registered Agent Service?

Using a professional registered agent makes sense when -

  • the business was formed in a state where it is not operating (often the case with Delaware and Nevada corporations)
  • the business operates in multiple states—particularly if there are not “bricks-and-mortar” offices in those states
  • the business is home-based or does not have a fixed business street address
  • the individuals running the business are likely to be unavailable during normal business hours throughout the year (whether due to the nature of the business, business travel or vacation schedules)

In these cases, a professional registered agent ensures that you will receive vital legal and state documents in a timely fashion.

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