Registered agent services are not cheap. Many companies charge between $ 100 and $ 125 a year to act as their agent. That’s why it’s important for you to know 1. Do you need a registered agent and 2. Should you pay for one?

What is a registered agent?

Each state requires that an LLC organized under its laws have a registered agent (or resident, in some states) in a physical location within the state. The purpose is that the government can deliver official documents to the LLC. The most likely documents are tax forms and court notices.

Basically, the Registered Agent is the place and person within the physical jurisdiction of the State in whom the service of the process can be performed. The State wants a natural person and a place within its borders to whom to go with taxes and lawsuits.

If you are forming an LLC in the state where your business operates, you can simply use the address of your business office. In this case, you are your own registered agent. This is the most common arrangement. Even if you operate your business from home, you can use your home address for official service.

When should you pay for a registered agent service?

If you do not have a physical location in the state where you formed your LLC, you will need to designate a registered / resident agent within that state to receive official documents.

Example: You live in Missouri, but formed your LLC in Nevada (there will be another post later on why this may or may not be a good idea). Nevada is going to want a registered agent who is located in Nevada to be able to file official documents, also known as tax lawsuits and notices (although Nevada does not have state income taxes, they do have business taxes, for example, on gambling). If you do not have a home or office in Nevada to receive these documents, you will need to hire someone to accept them for you. This person is a registered agent.

Many incorporation companies, for a fee, will act as your registered or resident agent.