A registered agent, also known as a resident agent or a statutory agent, is a person or business entity that is authorized to receive the service of the process and also official government correspondence on behalf of a company. Becoming a registered agent can be a great way to earn some extra income or even build a full-time registered agent service business. Here is a step-by-step guide on how to become a registered agent:
1. Check Your State's Registered Agent Requirements.
The requirements to become a registered agent in each state differ in each state. You'll need to check with your Secretary of State's office to determine the exact laws and regulations in your state. Common requirements include:
- Being at least 18 years of age.
- Being a resident or any business entity registered in the state
- Having a physical street address in the state (PO boxes are often prohibited).
- Passing required background checks
Make sure you fully understand and can meet all the requirements before moving forward.
2. Choose a Registered Agent Business Model
You have two main options when starting a registered agent business:
Become an independent registered agent by registering yourself individually. This has low start-up costs but you are personally liable.
Form a registered agent services company, such as an LLC. This creates a corporate shield from the liability but also more legal/accounting fees.
Consider projected income, liability risks, the tax implications, and ease of administration when deciding which option to choose.
3. Obtain an Appropriate Physical Address
To become a registered agent you must have a physical street address to receive the official mail and legal notices for your client companies. Most states prohibit PO boxes. If you don't have an appropriate commercial address, consider getting a virtual office mailbox rental or also coworking space. Make sure the address meets your state's requirements.
4. Understand the Responsibilities and Obligations
Registered agents have an very important responsibility to diligently forward the given legal notices and documents to their client businesses in a very timely manner. Make sure you understand these core obligations before taking on clients:
- Forward the official mail and legal notices the same day the received
- Keep a record of when and to whom the mail was forwarded.
- Remain available at your registered office during the normal business hours
- Resign if you wish to terminate your registered agent duties.
5. Check City/County Regulations
Your local city or county government may have additional registered agent licensing or occupational regulations you must comply with. Common examples include the business licenses, occupational permits, zoning restrictions, signage rules, etc. Do your due diligence so you operate fully legally.
6. Set up Your Registered Agent Filing
Once you meet all of the state and also local requirements, you must officially register as a commercial registered agent with your Secretary of State. The process involves filing the designated forms and paying registration fees, which differ by the state. This registration must be renewed periodically.
7. Obtain Errors and Omissions Insurance
While optional in most states, getting registered agent errors and omissions insurance is highly recommended to protect yourself from the costly lawsuits and claims. As a best practice, aim for at least $500,000 to $1 million in coverage. The premium costs are usually very reasonable relative to the protection it provides.
8. Market Your Registered Agent Services
Now that you are set up as an official registered agent in your state, it's time to start marketing your services to the prospective business clients. Effective marketing activities include website content, search engine optimization, donation text message campaigns, print advertising, networking events, direct outreach emails and phone calls. Highlight your knowledgeable, reliable and timely services.
Becoming an official registered agent allows you to provide a value-adding service and potentially create a lucrative income stream. By following the steps above, you can properly establish your registered business agent while staying compliant with all legal and regulatory requirements in your state.
