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 New York?
In this guide, we will break down all the details you need to know about New York registered agents.
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What is a New York Registered Agent?
One of the most common questions we receive from entrepreneurs in New York 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 New York does not provide a recommended list of registered agent services, we reviewed the top options and compiled a list of the best New York registered agent services based on price and overall value.
Who Can Be a New York Registered Agent?
The New York Department of State requires that all registered agents be either individual residents of the state or an LLC or corporation that provides registered agent services. While a business entity may never serve as its own registered agent, the owner, an employee, or another affiliated individual may as long as the individual has a physical street address rather than just a PO box.
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 New York Residents Get Served?
The most important part of a registered agent’s role is being served a summons.
In New York, before a summons is processed a plaintiff must first file a claim. All necessary documents can be found at the County Clerk’s office. The documents will require the exact legal name of the business entity being sued, the business address, and a brief justification for the demand. When completed, the form must be submitted with a filing fee of $20.00 or less.
If these steps are all taken correctly, the state of New York will allow an authorized process server to serve a summons to the defendant’s registered agent.
How to Designate a New York 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.
While the New York Secretary of State acts as registered agent for all LLCs and corporations, you may choose to designate an additional agent when you form your company.
When registering your company, you’ll have the option to designate an additional agent when you fill out either the Articles of Organization for LLCs or the Certificate of Incorporation for corporations. Both documents may be submitted by mail or online.
How Can I Change My New York Registered Agent?
If you would like to change your registered agent for any reason, the process is pretty simple.
Depending on the business entity type, you’ll need to either fill out the Certificate of Change form for LLCs or the Certificate of Change form for corporations. Both documents are extremely straightforward in nature, and require a filing fee of $30.00 upon submission, making the process to change your New York registered agent relatively easy and affordable.
How Does a New York Registered Agent Resign?
Sometimes, a registered agent may have to resign from their position.
New York registered agents wishing to resign must file the appropriate Certificate of Resignation. Depending on whether the business entity is an LLC or a corporation, the document will be either the Certificate of Resignation of Registered Agent for LLCs or the Certificate of Resignation of Registered Agent for corporations.
To complete either document, you’ll need the name of the business entity, the date on which it was originally established, and the resigning agent’s signature. The fee to resign is $60 for corporation registered agents and $20 for LLCs.
Why Should You Hire a Professional New York 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 New York. 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 New York 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 New York?
You need to have a registered agent to form your limited liability company or corporation in New York 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 New York, 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 New York 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 New York Secretary of State:
Department of State
Division of Corporations
One Commerce Plaza
99 Washington Ave.
Albany, NY 12231-0001