Did you know that as a business owner, you are legally required to have a Registered Agent in the state that your real estate company is formed in? This is particularly true if you have set up an LLC or Series LLC outside of your state of residence. There are many good reasons why investors choose to set up their companies in a location they don't live in. Some states offer favorable tax treatment, including a lack of a state income tax, while others offer legal and operational benefits to owners of corporate structures. It is not unusual at all for an investor living in, say, North Carolina, to have their investment properties secured in a Nevada or Delaware Series LLC. There are a number of financial, legal, and practical reasons to structure a company outside of your state of residence. There is nothing wrong with this practice. In fact, we often recommend it for asset protection purposes - check out our free educational resource on the best states for forming a Series LLC for even more details. But real estate investors who do this must have a Registered Agent in the state where their business operations are based.
The Registered Agent serves a clear role that is critical to the legal standing of your real estate investment business. This is the person who will function as your legal point of contact for all of your business matters in your company's state. He or she will be responsible for receiving business documents and keeping up with all legal correspondence. To learn more, check out our previous educational article on the role of the Registered Agent.
Fortunately, you have options when it comes to satisfying the Registered Agent requirement. These are some of your most common options:
Using an attorney has some obvious advantages over a professional Registered Agent. First, someone who is simply a Registered Agent may not have much experience in matters of law. These individuals also cannot assist you with other aspects of company formation. An experienced real estate attorney, on the other hand, will be able to help ensure your compliance across the board - not just with the Registered Agent requirement. Further, a qualified attorney will also keep track of changes in law and corporate regulations. Because the law is always evolving, it's best to have someone with the knowledge and research skills to make sure you're operating your business by the book. Some investors prefer to use a professional Registered Agent to save a few dollars, but we find having a qualified attorney to help defend your real estate empire is well worth the investment.
At Royal Legal Solutions, we have served as Texas Registered Agents for our clients for years. We are real estate attorneys and investors ourselves, and well aware of the legal ins-and-outs of this role. Further, an attorney is the ideal legal face of your business. Our prices for this service are lower than market average, and competitive with some "professional Registered Agents." The difference is that we have the qualifications and credentials to back it up.
If you have questions about the Registered Agent requirement, contact us today If you're considering forming a business entity such as a Series LLC in Texas, Royal Legal Solutions can also serve as your in-state representative. Don't neglect this legal requirement for your out-of-state LLC or Series LLC. Take action and stay compliant by scheduling your personalized consultation today.
Scott Royal Smith is an asset protection attorney and long-time real estate investor. He's on a mission to help fellow investors free their time, protect their assets, and create lasting wealth.
Ready to know more than your attorney? Join our community platform where you'll get immediate FREE access to all our best educational resources for real estate investors. Including 8 Masterclasses, group mentoring replays, and much, much more.
Join thousands of real estate investors in all 50 states as they enjoy exclusive content, special promotions, and behind-the-scenes access to me and my guests. No spam, ever. Just great stuff!