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Can I be my own registered agent? - How to start an LLC

Yes, you can be your own registered agent for an LLC or corporation. While this can save you some money, there are pros and cons to consider before making a decision.

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Can I be my own registered agent?

Yes, you can appoint yourself as your own registered agent for an LLC or corporation. The only condition is that you must have a physical address in the state where your business is registered. In this article we discuss the pros and cons of acting as your own registered agent.

Do I need a registered agent for my LLC?

Every state in the U.S. requires that you have a registered agent if you’re forming a legal entity. Legal entities are limited partnerships, limited liability companies (LLCs) and corporations. Thus, if you’re registering a business that takes any of those three structures, you do need a registered agent as well as a registered office.

However, you don’t need a registered agent if you’re setting up a sole proprietorship or general partnership. These are not considered as statutory entities but rather common law entities. As such, sole proprietorships and general partnerships are not typically required to file paperwork with local states before conducting business within state borders. They also don’t need registered agents.

That said, you can still have a registered agent even if your business is a common law entity. This is particularly important if you are from out of state or if your schedule doesn’t allow you to always be at your business and receive important correspondence.

What is a registered agent?

By simple definition, a registered agent is an individual or company that you appoint to accept official mail and service of process on behalf of your business. Also known as an agent of process or statutory agent, a registered agent is responsible for receiving important legal documents on your behalf and sending them to you. Therefore, the agent provides a reliable and consistent way through which the state and other parties can reach you and your business.

The primary reason why states require every business entity to have a registered agent boils down to due process. In case of a lawsuit against your business, the case can’t proceed in court until your business is properly notified. Such communication is passed to your registered agent. That’s the reason why the law requires that your registered agent must have a physical address within the state where your business is registered. The agent must also be available during business hours so that other parties in a suit can easily find them and ultimately find you.

Alongside easy communication, the legal requirement to have a registered agent prevents big firms from hiding behind their thousands of employees. In case of any legal action, the registered agent acts as a known point of contact for the company.

Can I be my own registered agent?

Yes, you can be your own registered agent. There’s no law or provision preventing you from acting as your own registered agent in any U.S. state. However, you can only be your own agent as long as your business is registered in your state of residence. You must also have a registered office in the same state, not just a P.O. box. Therefore, if you’ve been wondering: can I be my own registered agent for my LLC? The answer is yes, you can albeit with some conditions to keep in mind.

Can an LLC or Corporation act as its own registered agent?

No, an LLC or corporation that’s being formed cannot act as its own registered agent. In consequence, the company you’re setting up cannot name itself as its registered agent.

You can, however, use a registered agent service. This is basically a company that accepts tax and legal documents on behalf of your LLC, limited partnership or corporation. Keep in mind that these firms charge a small annual fee to accept service of process and official mail on behalf of your business. That’s something to include in your budget should you opt for this route.

The alternative to using a registered agent service is giving your personal name as the registered agent for you LLC or corporation. And as already mentioned, you would need to be a resident of the state in which your business entity is registered.

Should I be my own registered agent?

It’s not uncommon for entrepreneurs to consider being their own registered agent. While that’s an available option, there are a few pros and cons to keep in mind.

Pros of being your own registered agent

Saves cost: The biggest selling point for being your own registered agent is that you won’t need to hire the services of a registered agent firm. This will save you about $100 per year – which is the typical fee for this type of service.

Convenience: if your schedule is such that you’re almost always available at your company during business hours, then it may be suitable to serve as your own registered agent. This is not a big deal, especially if you don’t mind if your staff and customers see you receiving legal documents.

Cons of being your own registered agent

You always need to be present: if you act as your own registered agent, you’ll need to be available and reachable at all business hours. This translates to spending all your weekdays (except federal holidays) from 9AM to 5PM at your company. In case you’re not available on a particular day, you’ll need to have someone on hand to receive and sign for documents at the registered agent address.

Requires physical address: if you plan to be your own registered agent, you need to have a physical address – not just a P.O. box – in the state where your business is located. This essentially means that you have to be a resident of that state. Should you need to form an LLC or corporation outside your home state, you’ll need to hire the services of an in-state registered agent.

Your details are public records: as your own registered agent, your personal details, including name and address, are part of public records that anyone can access through your secretary of state’s website. This can cause serious privacy concerns, particularly if you operate your business from home. That’s the address that will appear in public records.

Being served at work: in case a lawsuit is brought against your company, you may be served with service of process documents in the view of your staff and customers. This is not always ideal.

Default judgements: a default judgement occurs when you fail to respond to a lawsuit. This may happen if you’re sued but fail to receive service of process documents because you were not available to be served at your place of business. You’ll be unable to defend yourself (and business) in court, prompting the court to enter an automatic judgement against you. Regardless of the case, such a judgment may have very serious consequences for you and your business.

Hard to expand: since every state requires a registered agent, you won’t be able to open new locations in other states if you serve as your own registered agent. This is because under normal circumstances, you can only register as a resident of one state at a time. To expand, you’ll need registered agent services in each state that you plan to open a new location.

Additional documentation: should you decide to move out of state or change your business address, you’ll need to file more paperwork with the secretary of state for your new address if you’re your own registered agent. The process can be much simpler if you have a registered agent service that has multiple locations in various states.

What to expect from registered agent services

As already mentioned, the alternative to being your own registered agent is using a registered agent service. Among other things, your agent service firm will accept documents on behalf of your LLC or corporation and forward them to you as required. Such documents include:

  • Service of process notices. These include documents that accompany a lawsuit and those requiring your business to appear in court.
  • Tax forms.
  • Requests for licenses, permits, company reports and filings.
  • Official communication from the secretary of state.
  • Correspondence from the federal and state governments.

Final thoughts

It is possible to be your own registered agent regardless of the state where you’re starting your business. If the business is a legal entity (i.e., limited partnership, LLC or corporation), then you’re required by law to have a registered agent. The same doesn’t apply to common law entities like sole proprietorships and general partnerships.

While being your own registered agent can save you up to $100 per year, there are considerations to keep in mind before committing to that route. For example, you’ll need to spend all your business hours at your company so that you don’t miss important correspondence. Missing a service of process can easily expose your business to default judgments.

In short, there are arguments for and against being your own registered agent. Ultimately, it boils down to whether you live in the state where you’re creating your business and if you’re always available to receive and sign for official documents.

5 Steps To Form Your LLC

Choose an available business name
Designate a registered agent
File all your state-required paperwork (Articles of Organization, operating agreement, etc.)
Get a federal tax ID (EIN) number
Make sure to pay all mandatory annual fees and state fees
Or, skip the above steps and let Nearside do it for you!
Form Your LLC Today

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