Most Real Estate Investors Don’t Need To Pay For A Registered Agent
If you don’t own an LLC yet and you plan on getting one, read this first.
You may or may not know that you’re required to have a registered agent in every state your LLC does business, including the state you formed your LLC in. Each state has different rules when it comes to who can and can’t be a registered agent.
The purpose of a registered agent is to receive and process government notices and file annual reports. As I said, every state has their own rules about registered agents. But there are 3 rules that you can find in almost every state:
- The Registered Agent must be a resident of the state he or she plans on being a registered agent.
- The Registered Agent must have a physical address in the state. (Meaning you can’t use a PO box.)
- The Registered Agent must be available during “normal” business hours. (As in from 8 to 5 Monday through Friday.)
A registered agent is a permanent requirement. You’re required to have one as long as your business continues to operate.
What happens if I Don’t Get A Registered Agent?
Your business could be administratively dissolved (they’ll revoke your license) and lose it’s ability to do business in a state. Furthermore, you will lose your legal protections and be vulnerable to lawsuits. But where they really stick it to you is the reinstatement process.
The reinstatement process can take several months to a year in some states. Then there’s the fees, which can get expensive depending on what state we’re talking about.
Should I Be My Own Registered Agent?
I’m going to assume you’re a real estate investor. If you only own properties in your home state (your state of residence) I wouldn’t bother getting an agent. But if you have privacy concerns, then you may want to get one. Otherwise save your money and be your own registered agent.