The use of a registered agent (RA) is one of the more confusing aspects of business ownership, but it is required of LLCs and corporations in all 50 states. This article will break down what a registered agent is and how, when, and why to use one.
Learn more about how PRIME's RA service works here.
What is a registered agent?
A registered agent is essentially the designated recipient of official government and legal correspondence for a company. The name and address of your registered agent are publicly filed with the state where an LLC is established. This is the information used to deliver official communications for the company. The communications can include:
Government correspondence: tax documents from the IRS, compliance and regulatory documents from state or federal agencies, etc.
Legal correspondence: service of process notices or other legal documentation.
What are the requirements for a registered agent?
There are two simple requirements a registered agent must meet:
Be a resident of the state with which your LLC is registered.
Have a physical address... no PO boxes or virtual mailboxes.
Can I be my own registered agent?
If you personally fit the requirements, you are allowed to act as your own registered agent. However, most people prefer not to do this for several reasons.
Privacy: Because the registered agent address is publicly listed with your LLC, using yourself as a registered agent eliminates the privacy a lot of people value in an entity structure.
Scam filtering: It's common for scammers to take advantage of brand new businesses by sending them solicitations designed to look like compulsory notices. With a professional registered agent service, you can be sure you won't be duped by malicious material.
Convenience: You have to be available to receive official correspondence when it arrives. If you're not available 100% of the time during business hours, you'll want to use a third-party registered agent service to avoid the consequences of interrupted deliveries.
Using a registered agent: Dos and don'ts
While it's a very helpful tool for your business, knowing how to use your registered agent address can be a little tricky. Here's a quick breakdown of appropriate uses.
Do:
List your registered agent's address on your entity formation paperwork... that's it! Your registered agent is only meant for very official communications from the government or a legal entity. They will use the address on your business entity record.
Don't:
You shouldn't use your registered agent address for anything else—it is not meant to act as a post office. This includes business services, package deliveries, bank or credit card accounts, utilities, and vehicle registration (even if it's a business vehicle!). Many people try to use the registered agent address on business address validation cards—like those required by Amazon, Google, or eBay—but this will not work.
In short, the point of a registered agent is to say "I give the government permission to contact me here," and that's about it!