Are you considering forming a limited liability company (LLC), or have you already started the process of creating one? If yes, you must have heard that hiring a registered agent is a requirement, and this is a legal requirement that applies across the 50 states in the U.S. However, because it’s a legal obligation, you shouldn’t just choose a random registered agent to fulfill your legal obligations to avoid any consequences in the future.
With this in mind, certain considerations may help in making the right decisions when hiring a registered agent for your company. Let’s get started.
What’s A Registered Agent?
Before you find registered agent, make sure to first understand this player’s role in your day-to-day operations. A registered agent is also referred to as a statutory agent and is considered as a business entity or person who, on behalf of your company, receives communication from the secretary of state as well as other government bodies. These communications include the following:
- Compliance documents
- Tax documents
- Court summons
- Annual filing documents
- Formation documents
- Lawsuit notices
- Annual filing documents
- Government correspondence
However, certain requirements must be met before a business entity or person can qualify to become a registered agent. These requirements vary from one state to another, but they generally include these:
- The agent must physically have offices in the state, and a P.O box address alone won’t be accepted.
- The registered agent must always be available within normal business hours at their registered office.
- The agent should be at least 18 years old.
Factors You Should Consider When Hiring A Registered Agent?
You must consider some factors to guide you when deciding on the registered agent to work with, and these include:
1. Consider The Company’s Experience Level
Finding a registered agent with experience and good credentials can mean all the difference. This is because it ensures your LLC isn’t susceptible to cracks that might cause issues with the secretary of the state office.
An experienced registered agent can take responsibility for your company’s legal business and provide services that allow it to operate successfully. This is because they’re knowledgeable about your state’s laws and regulations. They also have experience dealing with various kinds of government notifications and communications. In addition, they’ll never miss a deadline on any government request, which might expose your business to serious legal consequences.
2. Check Whether They Offer Competitive Pricing
Registered agents are in the business to make money in exchange for rendering their services, such as helping you with business registration and filing. However, their rates vary from registered agent to another. Because of this, you should look for one who guarantees greater value for money while still delivering exceptional services.
This is why you must take your time to compare the prices charged by different registered agents in your state. While doing this, it’s important to note that a registered agent that charges significantly less than others may not provide you with the same quality of services as other agents. They also might be less experienced than others in handling some of their duties.
On average, you’ll spend between USD$50 to USD$400 or more each year, and this significant difference is due to how much administrative work needs to be done. However, you need to be very careful about hidden charges, which are quite common in this industry. This is why you must carefully read your agreement to make sure you don’t get fooled by any extra costs that may be hidden in the fine print.
Any registered agent that offers you one flat fee for all services will probably be more economical than one that charges by the hour. However, those with a flat rate should also have set hours, so you know exactly how much time they’ll spend on your business filings and other legal matters. If their rate is hourly, inquire about what their minimum charge is and if there are any additional fees for travelling out-of-state or working on weekends.
3. Assess Their Level Of Customer Service
When looking for a registered agent, it’s essential to consider their customer service record. This is vital considering the registered agent will be an extension of your company, as they’ll represent you in dealings with the state. Because of this, you must choose a registered agent that provides you with exceptional quality customer service and has proven to be capable of doing so.
You also want a registered agent to whom you feel comfortable reaching out because of their cordial and prompt response. It would be best to research online reviews and recommendations regarding your prospective registered agent. Ideally, you should only choose a registered agent with a high rating. Additionally, it’s also better to look at past customers’ comments to know what they liked and disliked about the registered agent.
4. Company’s Reputation
A reliable registered agent should have a good reputation in your state. The level of experience and expertise in handling business registration and filing is critical for a registered agent to help businesses register with the state government and do their annual requirements. Furthermore, you can ask around different people who have businesses in your area about the reputation of a particular registered agent that you’re planning to hire.
Hiring a registered agent with an excellent reputation helps you to have peace of mind, knowing they’ll do their job correctly. In addition, this agent will be handling a lot of sensitive and confidential business documents on your behalf. So, you would want someone who is trustworthy enough not to leak any of the information to the wrong parties.
5. Evaluate Software
In the current digital age, you need to choose a registered agent that uses the right technological tools to guarantee the prompt transmission of appropriate documents in a desirable format. Make sure to check this because registered agents don’t have the same level of technological knowledge.
When assessing the software of a registered agent, you should examine details such as how they send you documents and how you get notifications. Ideally, the best registered agent is one who sends you all your notifications through a centralized portal. This will help you personalize your notifications to match your unique needs.
An exceptional registered agent should also use technology that assists everyone in your LLC in familiarizing with the state requirements and navigating the rules.
You need to consider many factors when hiring a registered agent for your company. However, all this information and requirements can quickly become confusing and overwhelming in the process. That said, this in-depth guide can ease your troubles by outlining what you should consider in your search for a registered agent in an organized way.