As a general rule, states across the United States require corporations, limited liability companies, and other business entities to have registered agents. Also known as a resident agent or a statutory agent, a registered agent can be most helpful for business owners in terms of compliance requirements.
States usually vary in the forms they use and in the filing schedules they expect from businesses. With that in mind, businesses need to appoint a registered agent who is highly knowledgeable with the different requirements. Staying legally compliant is a major priority for all companies, especially if they want to maintain a positive reputation and continue to operate the business without penalties.
Working with the right registered agent can surely benefit your business in many significant ways. So while it’s possible to function as your company’s own registered agent, it’s still a better idea to hire a professional. A third party provider can definitely lighten your burden.
How a registered agent can help you stay legally compliant
So how can a registered agent help your company meet compliance requirements? Here are some specific examples:
1. You won’t miss important compliance documents and due dates
Perhaps the most obvious – and most vital – advantage of having a registered agent is that you will not miss any of your compliance obligations. These professionals receive documents for your company and provide you with much-needed assistance for your compliance requirements.
You can always expect to receive notifications as tax forms and government notices arrive and as their respective deadlines draw near. In addition, you can count on their expertise if you have any questions or need any help with the filing process. This includes everything from your annual reports and franchise taxes, to licenses and permits, to anything else in between.
As you can imagine, a registered agent can really make things convenient for you, especially if you’re someone who doesn’t enjoy doing paperwork by yourself.
2. You can avoid the consequences of non-compliance
Simply put, registered agents act as your first line of defense against risk. With their help, you won’t have to deal with the hassles that come with failure to meet compliance requirements. This means you can avoid paying hefty penalties.
More importantly, you can legally continue with your business operations without losing your good standing with the state.
A Certificate of Good Standing is often required for common business transactions, such as:
- Opening a business bank account
- Requesting business loans
- Attracting potential investors
- Registering to do business out of state
- Partnering with another company
- Transferring or disposing of a business
3. You can respond without delay if someone sues you
Aside from business requirements, registered agents also receive legal documents and lawsuits on your behalf. So when someone files a lawsuit against you, for example, your registered agent will be the first to know about it and inform you right away.
As a result, you get to respond to the lawsuit in a prompt manner. You won’t have to worry at all about being hit by a default judgment, which can potentially cost you a lot of money. You can immediately work with your lawyer to defend your business, clear your name and stay legally compliant.
4. You won’t have to deal with law enforcers in person
Speaking of lawsuits, did you know that police officers will personally deliver the Service of Process (SOP) when you get sued? This can be an uncomfortable scenario if you’ve listed your home or office address as your registered address. It can be really embarrassing, especially when you have customers, staff or neighbors around.
Acting as your company representative, your registered agent is authorized to receive the SOP at their address. They will immediately forward any relevant information about the case to you, allowing you sufficient time to plan your response.
5. You can protect your privacy
Your name and address becomes public information when you list yourself with the state as your company’s own registered agent. While that’s possible and could appear as a cost-effective alternative, it could likewise cause certain privacy concerns.
For instance, marketers who get to access your contact details can easily send you junk mail. Plus can you imagine the possible risks if you’re operating a home-based business and need to publicize your home address? What happens if you have an angry customer or disgruntled former employee showing up on your doorstep?
You won’t have to deal with such issues if you have a designated registered agent. Their details will be listed instead. This will permanently put an end to your privacy concerns and unsolicited mail problems. This will then allow you to focus better on your compliance requirements.
A professional registered agent can be a valuable resource for your business when it comes to staying legally compliant and more.
While listing yourself as your business’ own registered agent is possible, hiring one is still the better option. They have the know-how and experience to ensure you have the best experience. They’re precise and organized, plus they have the essential skills needed to represent your company.
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