What is a Registered Agent and Why Do I Need One?

Registered Agent Business Card


What Is a Registered Agent?


When you or your attorneys formed the legal entity that holds your real estate, it was a requirement mandated by the state that you appoint a registered agent (also known as a resident agent or statutory agent). A registered agent is a person or company designated to receive service of process and official mail on behalf of a business. Your attorney, your CPA, someone within your company or you might be your registered agent.


In this article we will cover:


  • Understanding the reason for and duties of a registered agent

  • Deciding who should be your registered agent

  • Understanding the quality and cost of a third-party registered agent


Why Is a Registered Agent Needed?


The short answer? Because the states say so. There are many reasons for forming a legal entity to hold your real estate: the entity may shield your assets from liabilities and the type of entity you form impacts the taxes you will pay. One of the most important aspects of having a legal entity is anonymity. Rather than having a public record of Bob Jones owning Lakeside Mall with Bob’s phone number and address, an entity typically has an untraceable name such 123 Lake Partners, LLC. The only contact for the entity filed in the public records is the registered agent. The price of anonymity is that someone must be available to accept correspondence or “Service of Process” for the entity. That someone is the registered agent.


Who Can Be a Registered Agent?


States require the registered agent to be a resident of the state of formation and have a publicly-accessible physical location. Any individual or business that meets a state’s registered agent requirements can be a registered agent. In most states, that individual can be the owner of the real estate, a brother-in-law, an attorney or CPA. Some states even allow a corporation or LLC to be its own registered agent.


What Does a Registered Agent Do?


Most states require registered agents to be available during normal business hours to accept official notices and “Service of Process.”  Service of Process is the procedure by which a party to a lawsuit gives notice of legal action to another party. Professional registered agent services will notify the entity’s contact person(s) when documents have been received. Professional registered agents should also:


  • forward all mail received either electronically or by physically forwarding

  • notify you when your business’ annual reports are due to the state

  • help you with business filings

  • provide tools to track your entity’s status


Your brother-in-law will probably not provide all services but a good professional agent will.


Should I Hire a Professional Registered Agent?


Given the potential penalties, liabilities, and possibility of entity dissolution caused by missing important notices and filing dates, choosing whether or not to employ a professional registered agent is an important decision. For the minimal cost involved, especially if you are a professional real estate owner or running a company that is responsible to investors, it is wise to hire a professional.


Let’s say you use your brother-in-law as a registered agent. Your registered agent is required by law to be available during normal business hours. Let’s assume a process server tries repeatedly to serve legal documents, but your brother-in-law is on vacation in Bermuda and so no one is home. The process server will then proceed to publish the notification in the newspaper and the court litigation process can move forward without you even knowing about it. This is an extreme example but it illustrates the point that not taking the registered agent appointment seriously could expose you to unnecessary risk.


Here’s the bottom line. You’re required to keep a registered agent and registered office address in every state. Maybe you’ve listed yourself or an employee as your agent in your home state, but unless you have an office in the other states where you have a presence, you’ll have to hire someone or write down a friend or family member’s name and address and hope they do their job. You may have your attorney act as your registered agent. This may afford excellent protection but at what cost?


How Not to Choose a Registered Agent


If you decide to hire a professional registered agent, how do you choose one? 


  • In many cases, especially in larger real estate firms the registered agent was appointed by or arranged through the firm’s attorney. Many law firms will choose the largest registered agent or the “safe” choice. This may not be the most cost-effective choice. Biggest is not necessarily the best.

  • You can do an internet search for "registered agent" and choose the seemingly cheapest option. Cheapest is not necessarily the best.

  • In some cases, the registered agent is an employee of your firm. It is prudent to verify that the employee still works for you and is actually receiving correspondence from the state. Familiar is not necessarily the best.


How to Differentiate Between Registered Agents


There is an old saying in the service business: “There’s fast, there’s good and there’s cheap – pick 2.”  If the service is good and cheap it will not be fast. If the service is good and fast it will not be cheap.


Many registered agents compete purely on price. Whether it is an initial cheap teaser rate that will go up at renewal or just a cheap rate with limited service, many startup firms are in a race to the bottom. Cheap and fast will not be good. Cheap and good will not be timely. If you are in business for the long-haul you should want reliable vendors and partners that will be around in your future.


There are registered agents who compete on primary services, namely the two key primary services: mail delivery and service of process.  As retailers like Amazon has shown, in the delivery business speed is most important. When choosing a registered agent you should ask about the processes they use to deliver your mail and notices. Many national registered agents use their local state office as a mail drop location. Your state notices or service of process notices are sent to the registered agent’s state office then forwarded to a central office for sorting and disposition. 


If you have an appointed registered agent and wonder how long it takes for your correspondence to reach you, try this test: send a letter to yourself via your registered agent to see what happens. In an experiment we did with a national provider, the letter we mailed to ourselves prompted an email 7 days later informing us that the agent received the letter. 3 days later we received a FedEx package containing the letter.  It was a 10-day round trip.  Is it safe to assume something more important, like a notice of a lawsuit, would receive more prompt service and a shorter turn-around time?


Some smaller registered agents only resident in a particular state may have staff at their location to sort and direct the correspondence for that particular state but there is only one national firm that has staff in every state to locally scan all correspondence and deliver it immediately.


Something to also be aware of regarding delivery of correspondence received by your registered agent is additional costs for forwarding. In our experiment, hopefully, the cost of the FedEx was not passed along.


Most full-service national agents compete with additional services, such as:


  • Annual report reminders and compliance notifications

  • Incorporation services – New formations

  • State forms and filing tips

  • Software


Most national registered agent firms provide reminders and compliance notifications. It is usually your responsibility to update the agent as to who should be notified at your company. If you have a professional registered agent you should check to see if the appropriate people at your firm are on the notification list. Most national registered agent firms also provide new company formation services. These services are at an additional cost plus filing fees but may be useful for corporate formation without using a law firm. These incorporation services are cost-effective and usually guided by staff attorneys within the registered agent firms. Since most registered agents supply incorporation and other services they also have a ready supply of state forms and filing tips.


The software provided by the registered agent is something you should definitely explore. Many firms use their software for internal processes to generate notices and keep your data organized. You may or may not have access to those systems. If you do, does it have all the components you need to manage all of your entities regardless of the registered agent? In other words, is it your tool or theirs? The software provided by the registered agent can and should be the most important differentiator for your overall entity management strategy.  


We are firm believers that for entity management, software should come first. Proper entity management software gives you a method and system for storing and controlling your entity data to bring efficiencies to your organization. We believe that the registered agent function should be integrated with your software tools in order to capture ongoing entity updates, data and documents.


For a complete solution for your firms’ entity management processes, engage a registered agent that integrates with and complements your overall management system.


Cost of a Registered Agent


A google search for registered agent will return a list of providers charging as low as $25 per entity annually. The firms listed below are market-share leaders most often selected by those firms choosing a third-party registered agent.


Some of the national firm’s registered agent charges are listed below. The information comes from their websites as of February 2018 and may not reflect applicable discounts or other promotions, but this is the information as we find it.

The cost of hiring a registered agent for your entity will range from $100 to $300 annually. Rather than "what is the cost?", we think the main question should be: "Does the registered agent integrate their data with your software and systems?".  That consideration is more significant than the fee charged by the registered agent considering the total cost of entity management in your organization.




Hopefully, this article has given you some good information about registered agents. The main takeaways are:


  • You are required to have a registered agent. Hiring a professional reduces your risk.

  • The primary service provided is mail and service of process delivery. Delivery should be fast. Find a fast one.

  • Costs range from around $100 to $300 annually. You might get cheaper but check for add-ons or hidden fees.

  • Most national firms provide additional services that might be useful.

  • MOST IMPORTANT – Does your registered agent and the data it produces integrate with your overall entity management system?


We are firm believers that for entity management software should come first. Good software gives you structure and a method for storing and retrieving your entity data.  Organizing that data in the software comes next. That organization comes from a good back-file project. Finally, setting up long-term, ongoing data flow from your registered agent completes a successful entity management system.


How We Can Help


If you have a legal entity you must have a registered agent.  We provide best-in-class registered agent services with 50-state (and Puerto Rico) representation. We have staff in each office that locally scans your documents and provides immediate delivery of your documents. We provide this primary service fast along with notices, updates and formation services if you need them. Most importantly, we provide entity management software to help organize your data, put you in control of your entities and keep you in control for compliance, efficiency and cost savings. Our entity management software and registered agent services are integrated to provide you a complete and comprehensive solution for your real estate entity management needs.


Please send us an email or call and let us know when is a good time to talk. Your email will not be published. 


Disclaimer: Real Estate Entity Services is a service company and does not provide legal or financial advice. This article is for informational purposes only. Consult with your legal or financial advisor to determine how this information applies to you.



COMPANY                          ANNUAL AGENT FEE

CT CORPORATION           $279

CSC                                    Call for Quote

LEGALZOOM                     $159 - $299 on renewal

INCORP                              $ 99

NORTHWEST                     $125

PARASEC                           $125

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Sheridan, Wyoming 82801

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