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Choosing an LLC Registered Agent: Requirements and Options

By Adnan Farooqui

Published on 30 Jul 2023 7 min read

New business owners are often confused about the question, who can be a registered agent for an LLC? They understand that one needs to be designated before the business commences its operations, but they often require some clarity as to how they’re supposed to go about the crucial task of choosing a registered agent for their business structure.

It’s okay if you’re in this dilemma! Just continue reading to find the answers to all your questions. After you read this article you’ll form a good understanding of what a registered agent is and how you should go about choosing one.

Who Can Be a Registered Agent for an LLC?

A registered agent is a person or company that’s designated by a business entity to receive official documents and communications on its behalf. These may include regulatory, tax, and legal documents such as lawsuits and court summonses. The agent is responsible for forwarding these communications to the business owner.

This is a position that comes with a lot of responsibility. You’ll want to choose an agent that can take on these important duties. The agent for your business entity can be one of the following:

Yourself 

Some states allow you to designate yourself as the registered agent for your business entity. However, there are usually a few state requirements that must be met. These include being of legal age, being a resident of that state, and having an office address there. The obvious advantage here is that you don’t have to pay someone else to be the agent for your business. 

However, there’s also a major disadvantage. Some states require registered agents to be available at the office during regular business hours. If you’re not there when the process server arrives, the person suing you could obtain substituted service, allowing for the lawsuit to proceed and you potentially lose your right to a defense.

Member of the LLC

Members of your limited liability company (LLC) can also be designated as registered agent for the entity. If you’re operating as a single-member LLC, you’re already utilizing this route. However, other members such as an officeholder may also be designated. 

The advantage is that you’re able to keep these important responsibilities within the company. There won’t be any reason to deal with third-party registered agents, thereby enabling you to exercise control over who has access to your company’s data. 

Some states restrict key people such as directors from serving as the registered agent so that may be disadvantageous. 

Your Employee

Employees may also be chosen as the registered agent for the entity. It’s allowed by most states as long as the basic requirements are met, including being of legal age and being a resident of that state. 

The biggest advantage of designating employees as registered agents is that you’re able to give this responsibility to people you already trust. It would also help allay any concerns about data privacy that you may have. 

One disadvantage is that the employee serving as the designated agent may need to be compensated for this additional responsibility. Another disadvantage is that if they’re out of the office or on vacation, or they leave the company, you run the risk of not receiving important documents until you notify the Secretary of State about the change of registered agent.

Your Lawyer

You may already have retained a lawyer to help out with the other aspects of the business. It’s entirely possible to have them serve as the registered agent for the entity as well. 

Since they’re already involved in assisting your business, your lawyer may seem like a natural candidate for this position. Furthermore, they’ll also be able to provide accurate guidance on any legal or regulatory issues that come up. 

However, it could be a big disadvantage as far as the costs are concerned. Having a lawyer perform the duties of an agent could end up being a lot more expensive compared to dedicated service providers.

Family Member, Trusted Friend, or Relative 

Nothing is preventing you from choosing a trusted friend, a family member, or a relative to act as the agent for your business entity. It may seem like the right thing to do since you know them and may already have a relationship of trust with them. 

If you tend to have a tight-knit approach to business and don’t mind involving people in your social circle within the business, then this might seem like an advantageous approach, since it could even save you money. 

However, always consider the possibility that there may be conflicts of interest or you could have a falling out with them. That would require a change of agent which would be an unnecessary complication.

Professional Registered Agent Service 

As for who can be a registered agent for an LLC, there are plenty of professional service providers that have made it their business to provide these services to business entities in their state. 

It’s a great idea to go with these service providers since they are solely focused on this job and remain updated with any new regulatory requirements from local and state authorities. They will thus be able to ensure accurate compliance for your business. Using them also adds a layer of privacy as it’s going to be their address that’s used in the regulatory filings.

Perhaps the only disadvantage is that it’s going to cost you. However, given the competition in this space, it’s easy to find a professional service provider for a few hundred dollars or less per year.

General Requirements for Your LLC Registered Agent

All states have set some bare minimum requirements that must be met by an individual or entity that wishes to serve as the registered agent for a business entity. One major requirement is that the agent must provide their consent to serve on behalf of the business. This is to ensure that the registered agent remains fully cognizant of their duties and responsibilities to each of their customers.

The other requirements are mentioned below:

Must Be At least 18 Years Old

Being the registered agent for an entity is a very crucial position, one that comes with a lot of responsibilities. States understand that this responsibility must be carried out by people who are of legal age. That’s why you won’t find any state that allows people under the age of 18 to serve as an agent. 

Have a Physical Address (Registered Office) in Your State

One of the general requirements is that the agent must have a physical office address in that particular state. It must be a physical address, either of an office, suite, or any other location, but not a virtual mailbox or P.O. box. This is to ensure that the process server can find the right person responsible for receiving important documents on behalf of the business.

What to Do If You’re From Out of State?

If you’re looking to expand your business to another state, you’ll need to designate a registered agent in that state. Since your existing agent will probably not have a physical address in that state, as an out-of-state business, you’ll need to designate an agent that has a physical address there. 

All the options mentioned above will be available to you at the new state. If you’re moving there yourself and the state allows it, you can act as your own registered agent, or you can have an employee do it or the lawyer you’ve retained.

What to Do If Your Agent Resigns or Moves? 

If an agent revokes their consent then you’ll need to find a new one. Perhaps you went with an employee or family member but now they’re moving out of state. In all these cases, you’ll need to change the agent. 

This requires you to go through a simple process. You’ll need to make a filing with the Secretary of State, notifying them that the agent for your business entity is being changed. The filing will include details of the new agent. In most states, there’s a nominal fee in the range of $15 – $30 that you’ll need to pay. The process doesn’t take more than a few days to be completed.

Registered Agents Are Valuable Partners For Your Business

Compliance can often be a big headache for business owners. They have so much going on that often things can fall through the cracks. Registered agents are valuable partners that help with your compliance matters and ensure that you don’t miss any crucial legal documents while you’re focused on expanding the business.

You’ll find a similarly valuable partner in doola Bookkeeping. It makes it super easy to balance books with advanced features, enabling you to seamlessly close your books at the end of the year with just one click.  

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