Every LLC in Florida is required to have a registered agent. You can either be your own registered agent or hire a third-party to do it for you.
One of the many formalities you need to complete before starting your business is choosing your registered agent.
A registered agent is a person or other business that receives your legal documents and accepts responsibility to deliver them to you. It’s a small part of running a business, but it is a necessary one.
You have two options when it comes to choosing your registered agent: serving as your own, or hiring a service to do it for you. The best choice for you depends on your budget, your business size and your availability. You can usually be your own registered agent if you only do business in one state and you’re the only employee. But if you’re registered in multiple states, it’s best to hire a registered agent service.
What is a registered agent?
A registered agent is responsible for handing you service of process documents. Those are any documents that require you to take action — like lawsuits or tax notices. They don’t respond or offer any counsel on your behalf — they just act as a reliable point of contact for those important letters.
All LLCs and other official business entities are required to have a registered agent, while sole proprietorships don’t. Your registered agent must have a physical address in the state you’re doing business in.
In most cases, a registered agent service is the best option for small business owners if business operations exist in multiple states. It allows you to do business in and hire employees from as many states as you want without having to hire 50 different registered agents.
What states do I need a registered agent in?
You need a registered agent for every state your business is registered in, regardless of how much business you do there. So even if you’re your own registered agent for your business in Florida and you want to expand your business to Georgia, you’ll need to hire a registered agent with a Georgia address to do so.
You also need to hire a registered agent for every state you have employees in.
Even small businesses can be affected by doing business in other states and hiring employees from different parts of the country. So if you are your own registered agent, you should be aware of the limitations.
Should I be my own registered agent?
You have to decide on your registered agent before you can register your business with the state of Florida. Before you make that decision, consider the pros and cons of becoming your own registered agent.
In general, you should only become your own registered agent if you don’t mind your address being public information, stay on top of your mail and only do business in your state.
Pros
- Easy to register: When you’re registering your business with Florida’s Secretary of State, all you need to do is enter your name and address when they ask for it online. There’s no outside work involved, which saves you time.
- Saves you money: Registered agent services cost money. You can likely save a couple hundred dollars a year by being your own registered agent.
- Less points of contact: You don’t have to worry about communicating with anyone else to get the documents you need if you’re the one receiving everything.
Cons
- Privacy concerns: If your business doesn’t have a physical address, then you have to list your personal home address. In Florida, that information is publicly available to anyone who requests it.
- You may need other registered agents: Since you can only be your own registered agent in one state, you may need to hire others down the line in other states. Unless you have a physical address in each state the business is operating, you’ll probably have to hire a registered agent who does.
- You have to stay on top of things: Since you’re in charge of receiving important documents, it’s your responsibility to open and reply to those letters accordingly. With an outside registered agent, you don’t have to worry about missing or forgetting an important document.
Should I hire a registered agent service?
Yes, you probably should. A registered agent service is the best choice for many business owners because it takes a big task off your shoulders, which leaves you with more time to focus on the parts of running your business that you love.
Pros
- Can cover multiple states: Instead of having to hire registered agents in multiple states, a registered agent service can cover all of them for you when it comes to doing business or hiring employees in another state.
- Saves your privacy: In Florida, registered agents’ addresses are public record. Instead of putting your home address in the public record, it can be safer to use your registered agent’s address.
- Makes sure you receive your documents: You could miss an important delivery if you’re your own registered agent. A registered agent service will make sure important documents end up in your hands and help you understand what they mean.
Cons
- Costs more: You’ll end up paying more for a registered agent service than you would by being your own registered agent. A registered agent service can cost around $100 to $300 per year.
How much does a registered agent cost?
If you choose to become your own registered agent in Florida, there is a $25 required fee when you register your business. If you change your registered agent before a year is up, then there’s an additional $25 fee.
Costs vary between registered agent services. LegalZoom costs $300 per year, while Northwest costs $125 per year.
If you hire a company to register your business for you, the cost of a registered agent service is likely included. This is a popular option for small business owners because the process of starting a business can be confusing and time-consuming.
The bottom line
One of the housekeeping tasks you need to take care of when starting your business is appointing a registered agent.
You can either be your own registered agent or hire a registered agent service. There are pros and cons to both. You can save money by being your own registered agent, or spend a few hundred dollars to hire a registered agent service and not have to worry about missing important documents.
Typically, we recommend that you hire a registered agent service in most cases because it can save time and stress while operating your business. But if your business is small enough, it might be best to be your own registered agent.
Need to get your business registered or hire a registered agent service? Schedule a free call with a DiMercurio Advisors team member today and we’ll walk you through the next steps so you can go back to running your business smoothly.
