Having a registered agent is a requirement when forming a business entity in most states. But did you know that you don’t have to be the registered agent?
I have always wanted a virtual law practice. Since I first found out it was a possibility I knew that was the lifestyle I wanted. To be able to help clients from anywhere, and yes that usually means my couch at home, was a dream. I am not alone in this. Many of my clients are social media influencers, or other creative entrepreneurs that have made it a goal to center their work around their life, not the other way around. This includes having the ability to travel on a whim and bring their work with them.
You don’t have to live in the State you want to set up your business in…
The law has realized a need to account for this nomadic lifestyle many business owners crave. And with technology being what it is, there is no reason you can’t have a legally fit business on the move.
Most of the people I talk to are shocked to hear that you don’t have to live in the state you want to set up your business in. To be honest, it has almost always been this way. Prior to technology and the rise of the modern nomad, people chose certain states to incorporate in based on the favorability of their tax law. I took an entire semester of class on Delaware Corporations in law school, and yes this was before Instagram became famous and subsequently made celebrities out of everyday people.
Companies have been registering their businesses in one state and living and working in others for years. But how?
Meet the Registered Agent!
A registered agent is a person or business whose address is filed with the appropriate paperwork when setting up your entity. It doesn’t matter if it is an LLC a C corporation or a partnership, all will have a registered agent on record.
A registered agent can be you, it can be another person in your company, it can be your lawyer, or it can be a third party registered agent company.
What do they do?
A registered agent exists to accept legal documents on behalf of your business. These will be documents related to lawsuits or renewal notices the state needs you to have. Their main job is to collect important legal and tax information for your business and forward it to you wherever in the world you might be.
There are a few rules…
The registered agent must have a physical address within the state you are setting up your entity. A PO Box is not sufficient. The state needs somewhere that is open during normal business hours to deliver mail to an actual address and human being. So, while you can totally pick your Mom to serve as your registered agent, be sure she is willing to “open” her home during normal business hours.
Your businesses legal address and the registered agent’s address cannot be the same. Not even your mailing address can be used for the registered agent’s address. While your businesses physical address might be a PO Box in California, if you’re incorporating in Florida because of their favorable tax structure, your registered agent needs to be a physical address in Florida.
You must have a registered agent address at all times. If you are outsourcing this job to a third-party company you will likely have a yearly fee for them to collect and get your important mail to you. That said, pay your fee or they will no longer be your registered agent and the state is not going to like that. Also, stay in contact with them throughout the year to make sure they are still operating their business.
The registered agent is not a mail forwarding service. Any regular mail should be directed to the mailing address for your business. If you’re a nomad, do not have people send mail to the registered agent address. They are to receive official state mail only. Keep that in mind when navigating how you will do business from anywhere in the world.
A few other things to keep in mind
Keeping your registered agents address current with the state is a requirement for being given entity registration and protection in any state. Stay on top of this. Also, note that all registered agent information is public, so this might make you rethink using your moms home address. Opting to use a third-party company is beneficial in this regard.
US business law has always taken into account that some people want to incorporate in one state and live in another. Technology has made this easier than ever. And my clients are surely taking advantage of it.
Many people want to do the work they love from anywhere in the world and fear that setting up an LLC or corporation will tie them down to one spot. Luckily a registered agent allows you to be anywhere you want with the personal liability protection that is so important when running a business. A third party registered agent service will be there to get the important legal and tax documents for you while you’re off living the life you’ve always dreamt of.
If you’re ready to set up an LLC or other business entity based on your needs email me at Shannon@montgomerypllc.com and let’s get your nomadic soul set up and protected.
Please note that this is not meant to be legal advice for you or your situation, this is merely some legal research and knowledge on the given topic