If you’re in the process of starting a business, there are many important considerations to make. One of the most significant concerns is choosing an agent for your company. A registered agent is required by law and should be someone that resides or has a place of business within Texas.
What is a Texas Registered Agent?
A registered agent is a person that the corporation designates to accept legal and administrative documents on behalf of the business.
In other words, the primary job of your registered agent is to receive important papers and keep them organized. Remember, it’s crucial for your company to have a current address in order for these documents to reach you!
For example, if a lawsuit is filed against your business and you aren’t present to defend yourself in court, it’s the registered agent who would be held personally liable.
How Much Does a Registered Agent Cost?
The cost of hiring a registered agent depends on the services you choose and how much paperwork is involved. Agency rates tend to range from $25-50 per month, depending on the service level and location of your registered office.
Good news: there are companies that provide Texas Registered Agent & Incorporation Service for as low as $29/month!
Why is a Texas Registered Agent Required?
Registered agents are required by the Texas Secretary of State. If your company is registered to do business in the state, it needs a designated representative who can receive and process official documents from both inside and outside of Texas.
The state can send important notices to your business at any time. If these details go ignored, you risk losing the privilege of doing business in Texas!
What Does a Texas Registered Agent Do?
Registered agents manage the receipt of all legal business documents, as well as any other important paperwork that arrives at their business address. This includes:
- Certified letters and notices from the state and federal government
- Debt collection notices that are owed to your company
- Summons for both criminal and civil lawsuits related to your professional activities
- Informational letters from the IRS
- Letters concerning unpaid taxes, audits, and other payment issues from the state and federal government
- Keep your business address current by filing a change of address form with the Post Office.
- Log all correspondence and keep records for a period of time that is required by state law.
- Forward any mail to the appropriate party, such as the President or Secretary of your company.
Note: It’s important that you maintain good communication with your registered agent so that you’re notified of any situations that require your attention. A registered agent may not be your designated representative, but it is someone you can rely on for important communications.
Who Can Be a Texas Registered Agent?
Any adult (age 18 or older) living in Texas can be registered as your company’s representative. If you share an address with your agent, the mailbox they hold must be clearly marked and accessible only to them.
No matter what their age or occupation, all of these individuals are legally authorized to receive important communications related to your business. Many TX registered agents are attorneys or CPAs who work for a law firm.
For some businesses, it may be necessary to appoint multiple representatives, depending on the type of business and the structure of your company.
Who Cannot Be a Texas Registered Agent?
Just because a person offers to serve as your registered agent does not necessarily mean it’s the best option. There are certain situations where you should think twice before allowing someone else to be on your company’s team:
- If they have been convicted of a felony or pled guilty contender serve, they cannot act as your representative.
- If they live outside Texas, they are not able to be a representative in the state and must choose someone who resides within the geographic boundaries of the Lone Star State.
- If you decide to dissolve your company any time in the future, you must do so before changing registered agents (or contact us for dissolution services). Otherwise, you risk complications with the State of Texas and your business license renewal.
Overall, do not have confidence in a registered agent who:
- Doesn’t offer to perform mail forwarding
- Offers to serve as an officer for your company (this is illegal)Asks you to deposit checks payable to them.
- Notifies you of late notices, tax bills, and other notices
- Fails or refuses to sign correspondence from the state and federal governmentDoesn’t respond to your requests for assistance in a timely manner
What are a Texas Registered Agent’s Duties?
Remember that you are responsible for choosing a reliable representative and taking the time to understand your responsibilities.
Registered agents can be held liable for certain issues related to their company’s name, street address, location, and records. Here are some examples that may land your registered agent in legal trouble:
- Offering information about the business that is inaccurate or incomplete
- Failure to forward contact info about a business or owner to the state)
- Failure to notify the Secretary of State when an entity is terminated for non-payment, default, or bankruptcy
- Accepting checks that are not payable to the company (for example, personal checks from a friend) and depositing them into their company account
- Failure to forward communications received from the state, including:
- Statements of fact (like notice of termination, dissolution, and legal actions)
- Certified letters notifying Texas business owners that a registered agent is terminated for non-payment, default, or bankruptcy
- Tax payments sent by business mail with insufficient funds in the account
- The Registered Agent Service Fee Filing (available via email or in person at our office) can be used to notify your agent of certain actions.
In addition to keeping business records, a registered agent may have other responsibilities depending on the type of entity you are forming:
- Registered agents for sole proprietorships must be 18 years old and cannot be an employee, creditor, or partner/member of the business.
- Registered agents for general partnerships cannot be a general partners and must be at least 18 years old but can hold an interest in the company.
- Registered agents for a limited liability company (LLC) must be 18 years old, live in Texas, and cannot hold an ownership stake in the company; they shall devote all their time to serving as agents.
- Registered agents for corporations must be 18 years old and cannot be an officer, director or shareholder.
- Registered agents for nonprofit entities (unless exempt from doing so) must be 18 years old and cannot hold an ownership stake in the company; they shall devote their time to serving as agents.
All Texas registered agents are responsible for paying the $20 renewal fee each year.
If a registered agent is terminated for non-payment, default, or bankruptcy, he/she must notify the Secretary of State within 10 days to release his/her name as an agent and update all entity information before a new representative is appointed.
What If I Don’t Maintain a Registered Agent?
You cannot file for a Statement of Rescission, which means you will not be able to cancel your entity within the first year of filing (or two years from incorporation in some cases). You are also risking:
- Bankruptcy proceedings that may leave your business name vulnerable
- The loss of financial information and assets if you do not file B reports and tax returns
- The possibility of being held personally liable for business debts
How to Change Registered Agents in Texas
File a Registered Agent Change Request (available via email or in person at our office) stating that you are replacing your current registered agent.
You must include the name, address, and phone number of your new representative so we can notify him/her. The $20 filing fee must be submitted prior to releasing the previous information.
When a business is in default, the Secretary of State will not release information until the default has been resolved. A new registered agent must be appointed before we can replace your representative.
Can a business be its own registered agent?
Yes, but the Secretary of State will not accept responsibility for its actions.
You may choose to have your business file as a registered agent if:
- You plan to only use your business address for correspondence
- Your business is new and has no record with us
- Your financial institution fails to forward letters
- You do not want to be responsible for other businesses’ paperwork.
If this is not the case, you will need to designate a registered agent and file as such.
When selecting a representative, make sure:
- You understand what their duties are
- They agree with your business structure
- They meet all requirements of being an agent
- You review and understand the disclosures
How To Elect A Registered Agent In Texas
When selecting a registered agent, we suggest using a trust or professional LLC formation service other than yourself.
Your agent should be someone with whom you have an established relationship and who is trustworthy.
Professional services include:
- Banking institutions
- Accounting firms
- Notary Public
- State Farm Insurance
- Other insurance agencies
- Business experts associations
- Local businesses
Election of a registered agent by trust:
If you decide to use a trust, make sure the trustee is someone with whom you have an established relationship. Your representative must be at least 18 years old and cannot be a beneficiary in your estate plan (unless he/she is an adult child).
The person(s) named as trustees must agree to be responsible for your business filings before you submit the application.
The trust will determine who can access finances, including protection from creditors or third parties, and what information is available for the public to see.
A trustee may not be required to file a bond or obtain insurance prior to serving as your agent. If you would like a bond to be issued for the trust, let us know, and we will provide you with a quote.
When choosing a registered agent, you may consider the following stages:
Stage 1: Reviews
Your first step in choosing a registered agent should be to find reviews of the agency. An agency that is highly ranked will provide peace of mind and ensure your business’s lasting success.
You can find reviews on Legal Firms Finder , for example, which will also tell you how to file complaints or even give you an opportunity to share your personal experience with the company.
Stage 2: Website Analysis
Next, you should pay attention to the website of registered agents. It will show information about services and employees. The site may contain testimonials, a history of promotions, or public relations articles that help you get a picture of the organization as a whole.
Online reviews can also tell you about clients’ experiences with an agency, how long it has been in business, and what you can expect from a professional experience.
Stage 3: Speaking With Real Customers
Look at the agency’s Facebook page or its YouTube channel and see if people are asking questions or writing complaints. If so, this would be an excellent opportunity to post your own concerns and get answers from a representative directly on the site.
In addition, you can read about their latest blog posts or press releases to find out more about the company.
Stage 4: Speak With Their Sales Team
The next step in choosing a registered agent for your business is to speak with their sales team. Most companies have representatives available to you via phone or email, or both, and they should be able to answer any questions you may have.
The representative will also ask for more information about your business so that he/she can find the best pricing plan.
Factor 1: Offerings
The first factor to consider when choosing an agency is what products or business services they offer. Examples of offerings include:
A. Registered Agents
A registered agent provides a company with a centralized point of contact for all administrative duties, including fulfilling legal obligations and filing formation documents pertaining to the business. They are also responsible for handling any correspondence on behalf of the company.
A registered agent can be a natural person or a business entity.
B. Business Consulting Services
Business consulting services can include helping you register your business name, preparing organizational minutes, and offering specific guidance on the formation process for a variety of business entities, including limited liability companies (LLC)s, corporations, partnerships, and voluntary associations.
On their website, you can also find information about taxation, rules, and regulations, auditing services, filing procedures, and more.
C. Marketing Services
Marketing agencies can handle online marketing strategies, social media management, or business planning for an organization either locally or across the country. They may offer digital advertising tools such as Google Adwords, ad creation using Instagram and Facebook ads, SEO (search engine optimization), search engine monitoring, and more.
D. Compliance Services
Registered agents can help your company with any or all federal and state compliance laws. They will handle everything from background checks to accounting, taxes, and even payroll services on behalf of the business owner(s).
Other common compliance services include a company’s annual meetings, stockholder records, minutes for LLCs, compliance calendar, and other required documents.
E. International Services
For companies that are interested in expanding into other countries, registered agents can provide assistance with legal requirements and even help you locate a foreign agent who can assist your business directly.
They also offer support for U.S.-based businesses that have operations abroad or plan to expand internationally through the use of subsidiaries or licensing agreements.
F. Corporate Governance and Compliance Services
Corporate governance services offered by registered agents can help a company prepare for or administer an annual shareholder meeting (AGM), including soliciting proxies, recording the results of votes, and keeping shareholder information updated on a timely basis.
Many businesses are required to file documents on a regular basis with the name of the business as part of each document or report. For example, businesses must annually file an Employer’s Annual Federal Tax Return (Form 941), a federal tax return for corporations or LLCs (Form 1120), and other forms with the IRS.
These documents are generally filed electronically with the IRS using an EFW filing method. A registered agent can help your company by providing electronic filing services.
Factor 2: Value Proposition
You can expect to pay between $40 and $550 per month for the services of a registered agent, depending on what you need. Some companies will charge by the hour as well. The best way to find out is to request a quote from different providers and choose based on cost, value, responsiveness, and reliability. Make sure they are responsive to your questions and are available to help you immediately.
If price is a big concern, then you can start off with the base services that most registered agents offer for around $40 per month: such as receiving your mail on time, opening it, filing documents, and completing necessary filings when required by law. Most firms guarantee 24-hour turnaround times on mail that is received, as well as one full day to open and scan it.
Factor 3: Ease of Signup
Look at how easy it is to sign up for a registered agent service of process. Are there any hidden state fees? Can you do the entire registration online with a few clicks of your mouse and enter some information about the business? Is it easy to find pricing and packages online as well?
Factor 4: Ease of Use
This is the biggest factor you should consider when choosing a registered agent service. Modern businesses are no longer limited to brick and mortar office buildings or small offices with desks that have drawers filling up all of their documents.
You can easily register for services online, which means you’re dealing with someone who’s been around for quite some time if they’ve made an effort to set up an online presence.
A lot of registered agent services are going to be accessed online, so they should have a website or portal that offers enough information about their services and pricing. It should also answer your questions in a clear, concise manner.
They should respond quickly when you send them emails with your questions. They should be able to help you in whatever way you need and really listen to your concerns about the agency’s services so that they can improve on them in the future.
Factor 5: Customer Service
When you’re choosing a registered agent, it’s important to look at the customer service that they offer. If there aren’t any issues, then you’ll have a smooth experience and won’t need to worry about anything else as your company grows.
The most efficient way to do this is by finding out how long they’ve been in business, which you can easily do online. The longer they’ve been around, the better chance that they’re going to offer high-quality customer service and good value for your money.
Best Texas Registered Agent Service
We’ve compiled a list of registered agent services in Texas that are highly rated by business owners.
1. Northwest Registered Agent Review – 9.10/10 (Our Top Pick)
If you want to incorporate in Texas and get all of your legal documents on file at once, then Northwest Registered Agent should be your choice. Their services start at $100 per year, so it’s a low-cost option that offers high value for an affordable price.
They have an easy-to-use website with no hidden fees or costs that could surprise you on your invoice.
They have excellent customer service that will help you with any questions or concerns and a 100% satisfaction guarantee.
2. Harbor Compliance Review – 7.92/10 (Best Budget Registered Agent)
Harbor Compliance, Inc. is the registered agent in Texas for a lot of corporations and LLCs, so they’re very experienced with setting up companies in the state. A big benefit to them is that their pricing starts at just $125 per year instead of thousands of dollars like some other companies out there.
They have a two-hour response time and a 1% fraud loss resolution guarantee.
3. LegalZoom Review – 6.59/10 (Best Premium Service)
LegalZoom is a service that provides you with legal documents for your business so that you can start it up without hiring an attorney. They have tons of different plans to choose from, including one specifically designed for Texas LLCs and Corporations.
They offer 24/7 customer support, and there are no hidden fees or costs on your invoice at the end of the month.
They also have a 100% satisfaction guarantee as well as a legal plan that allows you to speak with an attorney phone service or email whenever you need.
4. ZenBusiness.com Review – 7.32/10 (Best Premium Service)
Zen Business is a registered agent in Texas that will take care of all of your business needs, so you don’t have to worry about them. They are very experienced with setting up companies in the state, and they have really affordable pricing, starting at just $69 per year for an LLC and just $119 for an LP.
They have a two-hour response time, and they offer 24/7 customer support as well as there are no hidden fees or costs on your invoice at the end of the month.
They also guarantee that you won’t lose any money due to fraud with their 100% Fraud Loss Resolution Guarantee and there are no contracts so you can cancel your service whenever you want.
They offer support for annual meetings, a stock certificate, maintenance of up-to-date records on your behalf, and whatever else is necessary to keep your company in good standing with the state as well as the IRS.
You would not think that the state you register your business in could actually make much of a difference, but it can.
Find out how easy and affordable it is to incorporate or LLC in Texas with the help of one of these LLC formation services. The biggest reason to choose one is that they will save you time and money in the long run, and they can make sure that your business is completely set up correctly and will be able to operate smoothly.