A registered agent is a person or service that accepts legal documents and notices for a
business during regular business hours. When running a limited liability company (LLC), you can choose to serve as your own registered agent or hire another person or service to do it for you. Deciding whether to serve as your own registered agent depends on factors such as how much you value privacy, the amount of responsibility you want to accept, and the size of your budget.

Below, we explain the pros and cons of assuming this role versus working with a professional.

What’s in this article?

• What is a registered agent, and why do you need one?
  
• Should you be your own registered agent?
  
• How to serve as your own registered agent
  
• What are the risks of being your own registered agent?
  
• How to decide if you should hire a registered agent service
  
• What are the alternatives to being your own registered agent?
  

What is a registered agent, and why do you need one?

A registered agent is a person or service designated to receive legal and official documents on behalf of your business. This includes tax forms, lawsuit notices, and compliance-related paperwork from the state. The registered agent must have a physical address in the state where your LLC is registered and must be available during standard business hours to ensure your business receives important documents in a timely manner.

Having a registered agent is a legal requirement in most states when forming an LLC. Without one, your business risks missing communications that, if ignored, could lead to penalties, fines, or the loss of good standing with the state. Whether you act as your own registered agent or hire a service, you need a reliable registered agent to ensure your business stays compliant.

Should you be your own registered agent?

Deciding whether to be your own registered agent is a common question for business owners forming an LLC. Being your own registered agent saves you the fees you’d otherwise pay to a service and gives you full control over your own documents and business information. It also might simplify your operations by using a single address for all business communications.

However, it also requires that you are available during business hours and makes your personal address public information. Being your own registered agent also means you are solely responsible for receiving documents that are important to your business’s legal standing.

How to serve as your own registered agent

If you’re considering serving as your own registered agent, it’s important to know what requirements you must meet and steps you must take to formalise this designation.

Here’s what you need to know:

• You need a physical address in the state where your LLC is registered. You cannot use a P.O. box or virtual office. This address is where you’ll receive all legal and official documents.

• You must be available during normal business hours to receive mail.

• You must list yourself as your registered agent when filling out the paperwork to set up your LLC (typically, your articles of organisation). If your business is already established and you want to switch the registered agent to yourself, you can update your information with your state’s filing office online or by submitting a form.

• If you move or don’t want to continue being your own registered agent, you have to update the state with your new details.

What are the risks of being your own registered agent?

Being your own registered agent adds another layer of responsibility to business ownership. You’ll need to stay organised and ensure you never miss a delivery, while handling the everyday tasks of running your business.

Here are the additional risks to consider before assuming the role:

• As a registered agent, you’re required to be available during business hours at the designated address. If you’re out of the office or travelling, you could miss something important, such as a lawsuit notice or state compliance form. Failing to respond to these documents can result in penalties or losing your LLC’s good standing.

• If you move and forget to update your registered agent address with the state or you miss important legal paperwork, your business could be deemed noncompliant. This could result in penalties, late fees, or the state dissolving your LLC, which would halt your ability to operate legally.

• When you act as your own registered agent, your personal or business address becomes public record. This means anyone can look it up, which can be a privacy concern, especially if you’re using your home address. You might also start receiving more unsolicited mail or visitors at that address.

How to decide if you should hire a registered agent service

Deciding whether to hire a registered agent service depends on a few factors. If maintaining privacy or managing multiple locations are concerns, a registered agent service can relieve those burdens. On the other hand, if you’re a small, local business and you don’t mind handling the responsibilities yourself, you might be fine without one.

Here’s what to consider when hiring a service:

• If you don’t like the idea of your home or business address being publicly available, a registered agent service can protect your privacy. When you hire a service, their address becomes the public-facing one, keeping your personal information out of state records.

• If you’re often out of the office, travelling, managing a business with irregular hours, or don’t have the flexibility to be available to receive documents, a service can cover that for you.

• If your LLC operates in multiple states or you plan to expand across state lines, hiring a registered agent service can cover you in multiple locations. This eliminates the need to juggle multiple registered agents and ensures you’re compliant everywhere you operate.

• A registered agent service typically costs between $50 and $300 USD a year. If your budget can handle this added expense and you value the peace of mind that comes with hiring a professional, the investment could be worth it.

What are the alternatives to being your own registered agent?

If you’re unsure about serving as your own registered agent, consider these alternatives. The best option depends on your business needs, desired level of privacy, and amount of responsibility you’re willing to delegate.

Hire a registered agent service

You can hire a professional registered agent service to take on the responsibility of receiving legal documents and official notices for your business. They typically have offices in multiple states, so they can keep you compliant if your LLC operates in more than one state. These services also offer privacy because their address, not yours, will be the one listed publicly.

Use a lawyer or law firm

You can use your attorney or law firm as a registered agent. This can be particularly useful if your business is already working with a lawyer on other legal matters. Attorneys are accustomed to handling important documents, and they can offer professional guidance if something urgent happens. However, this option can be more expensive than hiring a dedicated registered agent service.

Ask a trusted friend or family member

You can appoint someone you trust to be your registered agent, as long as they meet the legal requirements. For instance, you could appoint a friend or family member with a physical address in the state where your LLC is registered. They would be responsible for receiving your business’s legal documents and would need to be available during regular business hours. While this can save money, it does place a heavy responsibility on the person you appoint.