A registered agent is the individual or business entity that receives legal documents from the state, and then forwards them to your business address. But why is this a requirement, and who should you designate as your registered agent in Colorado?
In this guide, we will break down all the details you need to know about Colorado registered agents.
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What is a Colorado Registered Agent?
One of the most common questions we receive from entrepreneurs in Colorado is why a registered agent is required to form an LLC or corporation. While it might seem like an unnecessary middle-man type of role, the registered agent fills a vital role.
The registered agent’s job is to provide a reliable way for the state to contact an official representative of your business at any time, which is especially important if your business is ever sued. If you didn’t have a registered agent, a lawsuit could progress through the courts without you even knowing about it, which is obviously far from ideal.While Colorado does not provide a recommended list of registered agent services, we reviewed the top options and compiled a list of the best Colorado registered agent services based on price and overall value.
Who Can Be a Colorado Registered Agent?
The Colorado Secretary of State dictates that a registered agent may be either an individual over 18 who is a Colorado resident or a Colorado company authorized by the state to provide the services of a registered agent. In either case, the registered agent must have a physical street address—P.O. boxes do not suffice. If you are an individual who meets the standards to qualify, you may choose to serve as your own registered agent.
Aside from the legal requirements, an important aspect to discuss is who should be your registered agent. You have the right to declare yourself as your own registered agent, which has its pros and cons.
On the positive side, you can save some money by not paying anyone to serve as your agent, but you’ll also likely need to make your home address a matter of public record, which is not ideal. Additionally, you’ll need to be physically present at your business during all standard operating hours (9-5, M-F).
Some entrepreneurs like to have a friend or family member serve as their registered agent, but if that person doesn’t have experience in this position, they might not know what is expected of them. In addition, designating your lawyer or accountant as a registered agent can work, but these options are usually quite expensive.
Our preference is to hire a professional registered agent service, which provides a combination of convenience, affordability, and peace of mind that is unrivaled by any of these other options.
How Do Colorado Residents Get Served?
The most important part of a registered agent’s role is being served a summons.
In Colorado, a plaintiff must first draft and submit a complaint and submit it to the clerk’s office of the county in which the defendant’s business operates. Depending on if the plaintiff is suing for more or less than $7,500, the case can be processed by either a small claims court or a county court. To file a small claims case, the plaintiff must complete a printed version of Form 250, “Notice, Claim, and Summons to Appear for Trial”.
After the form is submitted with the appropriate fee (which ranges from $31.00 to $55.00 depending on the court and the amount being claimed), the plaintiff must follow the court’s instructions on serving the documents to the defendant or the defendant’s registered agent at least 15 days prior to the trial.
How to Designate a Colorado Registered Agent
The answer to this question depends on what type of business you’re starting, but with either a corporation or an LLC, you’ll need to designate your registered agent when you form your company.
In Colorado, you will need to designate your registered agent when you form your corporation. This will be done via an online system when you complete either the Articles of Organization for forming an LLC, or the Articles of Incorporation for forming a profit corporation. While there is a PDF version of the Articles of Organization and a PDF version of the Articles of Incorporation, they can only be used to review the necessary information; all filings must happen through the Colorado Secretary of State’s online platform.
How Can I Change My Colorado Registered Agent?
If you would like to change your registered agent for any reason, the process is pretty simple.
First, you must use the Record Identification or ID search tool located on the “File a Business Document” page of the Colorado Secretary of State’s website. Using the tool, you’ll need to search for and locate your business entity, click on its ID number, and confirm that you are authorized to make changes to the record. Then, you will either complete the Statement of Change Changing Registered Agent Information form or the Periodic Report form, if you are in your periodic reporting period.
After completion of either form, you will be prompted to pay a $10.00 processing fee. At this time, the documents needed to change a registered agent in Colorado can only be submitted online, not in person or by mail.
How Does a Colorado Registered Agent Resign?
Sometimes, a registered agent may have to resign from their position.
To do so, the current registered agent must complete a Statement of Change Regarding Resignation or Other Termination of Registered Agent form. While a PDF version of the form can be seen at this link, the document itself must be submitted using the Colorado Secretary of State’s online filing platform.
To file a Statement of Change Regarding Resignation, the current registered agent will first need to search for and locate the business entity using the Colorado Secretary of State’s Record Identification or ID Search tool. After locating and selecting the correct entity, the current agent must confirm that he/she has authority to alter the company’s records, and proceed to file the form. After completion, you will be prompted to pay a $10.00 standard processing fee.
Why Should You Hire a Professional Colorado Registered Agent Service?
Hiring a professional registered agent is basically the best of both worlds between serving as your own agent, and designating a lawyer or accountant.
The biggest benefit in our opinion is the privacy protection this allows, as you will be able to keep your personal address private. There’s also a major advantage compared to having an attorney or accountant serve as your agent, namely the fact that registered agent services are almost always much cheaper.
Another reason we like this option is that these companies specialize in providing quality registered agent service. They know exactly what’s expected of them, and there are rarely any issues to speak of.
The other major benefit of hiring a registered agent service is that most of them operate in all 50 states, so that if you ever want to expand your business into another state, you won’t need to hire an additional registered agent. Your same registered agent will be able to provide the coverage you need in your new state, while still providing the same service in Colorado. If you hired a lawyer or accountant, they would only be able to help you expand to a new state if they have another physical office in that state.
You Stay Compliant
Finally, most professional registered agents operating in Colorado offer some sort of compliance calendar. With this service, your registered agent helps you keep track of due dates for ongoing LLC maintenance requirements like annual reports, which is a valuable bonus.
The top registered agent service providers include some other appealing attributes, including access to their extensive customer support networks. Some of them include a full year of registered agent service with any business formation package, which can be a real money-saver. Another welcome attribute is that some registered agent services provide volume discounts if you require service in multiple states, or if you prepay for multiple years.
What Is the Penalty for Not Designating a Registered Agent in Colorado?
You need to have a registered agent to form your limited liability company or corporation in Colorado in the first place, but if you let your registered agent service lapse, there could be some serious consequences.
Failure to maintain a registered agent could lead to your business losing its good standing with the state of Colorado, and the state also has the right to officially dissolve your LLC if they choose to.
Another issue would be the difficulty of being served if your business is sued. If the state cannot get ahold of your registered agent, a court may decide to go ahead with the lawsuit without your knowledge, which could even lead to a judgment against you. This can happen not just if you fail to designate a registered agent, but also if your agent is not present during business hours to accept the document delivery.
As you can see, the task of designating a registered agent for your Colorado business isn’t quite as easy as just writing down your own name.
There are significant downsides to just about every option in our opinion, but we recommend hiring a professional registered agent service because that option has the fewest disadvantages. They charge affordable rates, and you never have to worry about losing your good standing, having your LLC or corporation dissolved, or having a lawsuit proceed in your absence.
If you have any further questions, you can contact the Colorado Secretary of State:
Colorado Secretary of State
1700 Broadway, STE 200
Denver, CO 80290
Phone: (303) 894-2200 & press 2
Fax: (303) 869-4864