A registered agent is a responsible third party who is registered in the state where your business entity is formed. The registered agent may be an individual or a business entity and is designated to receive service or process (notice of legal action) on behalf of your company. Some states, like Delaware, require you to have a registered agent at the time of formation and maintain one during the life of the company.
Other nuances, which we’ve covered about Delaware that you should know about are the Delaware Franchise Taxes and Annual Reports. We describe the steps required with forming and maintaining your company in the startup checklists that are generated for you when you incorporate in Delaware or purchase Delaware Post Incorporation Documents.
What are the benefits of having a registered agent?
- In exchange for an annual fee, your registered agent will forward important paperwork to you so that you can keep your company in good standing with the state. State government send all official documents (such as franchise tax notices and annual reporting forms) to your registered agent who, in turn, forwards those documents to you with notice of next steps you should take.
- It’s difficult for a business entity to keep track of all legislative changes and reporting due dates for one or multiple jurisdictions (considering the state that your startup is formed may be different from the state in which your startup is headquartered). Your registered agent will make sure that you receive important notices so that you can respond on time. There may be penalties associated with not maintaining a registered agent and some states will go so far as revoking a company’s corporate status and assessing additional penalty fees on the company. Make sure you pay your registered agent fees when they are due and respond to their notices on time!
Can I act as my own registered agent?
You can (but only if you qualify as a registered agent under Delaware General Corporation law under these limited circumstances)! Some states permit you to act as your own registered agent but Delaware requires you to list a registered agent at the time you form your company. The agent must typically be a legal resident of the state in question and obtain authorization from the state to act as an agent. Note that the annual fees for a registered agent are fairly nominal (approximately $50-$300) in light of the great benefits of helping keep your company in good standing with the state.
Most states offer free access to their databases, where a company’s registered agent address is available to the public. In states that permit you to be your own registered agent, your listed address will, likewise, be visible and available to the public.
You can always change your registered agent to another party at any time during the life of your company with the filing of relevant state forms and payment of state fees. You may also be required to make an amendment to your articles of incorporation in some states, such as Delaware.