In California, a registered agent is a legal requirement for every business incorporated in the state. They act as a point of communication between businesses and the state, and the responsibilities include receiving all official paperwork, whether that relates to some from the states, or those served in a lawsuit.
This article will highlight some of the benefits associated with their use.
1. It Is Legally Required In Most States
In 49 out of 50 states, it is illegal not to appoint a registered agent for an incorporated business. Refusing to do so could result in a revocation of the associated business’s license, steep fines and potentially a criminal record for the managers. Another business might even be able to legally assume the old business’s name.
When considered from a legal proceedings point of view, it is understandable why registered agents are required. If one company needs to sue another, finding all the necessary details to bring suit would be a chore (i.e. where the business resides). Mandating everyone to have a registered agent provides a solution to this problem and allows companies to focus on more critical operations.
2. Keeps Business Records Private
It is as important that one’s business records be kept as private as one’s medical records. Public access to this information can make life quite painful. Luckily, hiring a registered agent negates this issue because the vast majority of states will only release the information of a business’s registered agent, rather than the information itself.
This creates a tangible benefit for businesses, who will receive less unwanted mail and solicitations as a result of their business information being hidden.
3. Instant Services
Time is money for businesses, and all businesses only have a finite amount of it. Using that time to respond to legal summons means that time cannot be used to deal with more critical, central operations related to the business.
Additionally, businesses only have a stipulated amount of time in which to respond to certain documents (i.e. lawsuits and tax filings from the state). With a registered agent handling these matters, the clock begins as soon as the document is received, meaning businesses have as much time to respond as possible.
The true value of this benefit can be realized when bearing in mind that, without a registered agent, a business might only discover they are being sued at a point when it is too late for them to respond to it. This failure to issue a response could be fatal for the business, particularly where the charges against your company are especially deadly.
4. Your Business Stays Up-To-Date
It is vital to the survival of a business that it stays in the loop vis-a-vis its compliance and filing demands. Failure to comply with these requirements can be terminal for a business, with enough financial penalties and fines to send one under.
Furthermore, registered agents take care of all of this on behalf of the business – they specialize in staying on top of the filings and compliance your business is required to do and will notify you as the deadline nears (often before you are even informed of the deadline by the state).
5. Keeps Your Business Balanced
Businesses are composed of humans, and thus are prone to some of their flaws. Distraction and stress can plague a business’s profits, which is why it is always best for a business to focus on its own operations and leave the handling of these administrative matters to the registered agent.
Unfortunately, businesses that try to handle their own state correspondence and take shortcuts often fail for this very reason. Because the workers are burnt out and distracted – their attention torn between the actual operations of their company and its federal correspondence.
Closing Statement
Evidently, even if registered agents were not mandated by law in California, they are invaluable to businesses. They remove a number of critical worries a business would otherwise have to consider, which allows them to focus on their central objectives.
For more information regarding registered agents in california, please see the attached link for a summary of all the information you need to know.
