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One of the things you’ll need to determine before filing your paperwork to form a limited liability company (LLC) in the state of Ohio is who will serve as your statutory agent. The state requires all LLCs to have one, but what is a statutory agent? What are their duties, and what are the requirements to be one?
What is an Ohio Statutory Agent?
A statutory agent (often referred to as a registered agent in most states) is an individual or company that is appointed by the LLC to receive important legal documents on behalf of the business. This position is necessary to ensure that the correct people within an LLC are notified in person in the event of time-sensitive events such as service of process for lawsuits. The agent also receives things like garnishment notices against employees, and notifications of taxes.
Who can be a Statutory Agent in Ohio?
The Ohio Secretary of State will not accept articles of organization for filing unless they include a written appointment and acceptance of a statutory agent (R.C. 1705.06(B)(1)). An Ohio LLC must maintain a statutory agent in the state at all times. The statutory agent must be:
- a natural person who is an Ohio resident; or
- an Ohio or foreign (out-of-state) corporation, nonprofit corporation, LLC, partnership, limited partnership, limited liability partnership, limited partnership association, professional association, business trust, or unincorporated nonprofit association with an Ohio business address (entities other than an Ohio corporation must meet the requirements of Title XVII of the Ohio Revised Code for transacting business in Ohio) (R.C. 1705.06(A)).
Should you be your own Ohio Statutory Agent?
Although it may seem like the simplest option is to be your own statutory agent, there are some compelling reasons to instead use a registered (statutory) agent service, such as:
- Availability – A statutory agent needs to generally be available at the principal address during normal business hours. This makes it difficult to leave the office to run errands, meet up with potential clients, etc.
- Avoiding Embarrassment – If a lawsuit is filed against the business and you are the statutory agent, you could have papers served to you at your office in front of clients. Obviously, that could be bad for business.
- Penalties and Fees – By not continuously maintaining a current statutory agent, the LLC could be fined or, worse, be dissolved by the state.
How is a Statutory Agent Appointed in Ohio?
A statutory agent is initially appointed when forming the LLC. You will name them when completing the Articles of Organization, which you submit to the state to make your LLC official.
