S corps are by definition LLCs or corporations, so they need a registered agent. Discover the essential facts about an S corp registered agent.
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An S corp registered agent is an essential role, but it can cause some confusion. That’s because a registered agent for an S corporation is no different from a registered agent for another entity type.
An S corporation is a limited liability company (LLC) or corporation that has filed with the IRS under subchapter S of the tax code. S corporation status is a special tax status that lets qualifying small businesses (domestic entities with a limited number of individual shareholders or members) enjoy pass-through taxation and tax breaks from self-employment taxes. An S corporation is not a business entity type; it’s a status that pre-existing LLCs or corporations hold.
As a result, every S corporation has a registered agent even before it makes an S-corp election. And, that registered agent should be maintained for the entire lifespan of the LLC or corporation.
In the remainder of this guide, we’ll cover the essentials of an S corp registered agent: what it is, why you need one, and what to do if you’re between agents.
A registered agent (For more information, please see our what is a registered agent page) is an appointed individual or business that accepts service of process and other legal notices on a business’s behalf. The title of an agent varies from one state to another; for example, some states call it a statutory agent, agent for service of process, or resident agent (see statutory agent definition). But no matter the title, the role is pretty much the same.
Any business that registers with its Secretary of State (or similar state agency) is required to appoint an agent for service of process. Every state has slightly different statutory requirements for who can be a registered agent. But generally, an agent must be an individual resident of the state, present at their listed address during all regular business hours, and be 18 years or older. Alternatively, you can hire a business entity that’s appropriately registered with the state. (See service of process definition)
Because there are such strict time requirements for an agent, we generally recommend hiring a registered agent service to fill this role for you.
As we mentioned earlier, an S corporation is not a business structure; it’s a taxation structure. Behind every S-corp election is a legal entity type like a C corporation or limited liability company. And since each of these entity structures has to appoint a registered agent when they form, an S corporation needs a registered agent, too. There’s really no way to avoid one.
In most states, business owners are allowed to serve as their own agent, but we don’t generally recommend that. Hiring a registered agent service does entail a modest fee, but it’s typically worth the expense.
Every S corporation (please see our What is an S Corp? page) needs an agent simply because it’s a legal requirement in every state. You probably designated your agent’s business address (also called the registered office) in your Articles of Organization or Articles of Incorporation. Some states call these forms the Certificate of Incorporation or Certificate of Organization.
Each state requires an agent because if an S corporation is brought to court, it must be properly notified so it can respond to the court summons. A registered agent helps ensure that all parties in a business suit are properly notified. Hiring a registered agent service like ours also means that any legal process will be served as discreetly as possible (as opposed to a process server showing up at your business and serving you in front of clients).
The exact benefits of having an agent will vary from one business (and state) to another. Generally speaking, an agent service gives you a little extra flexibility because you won’t be tied down to a physical address during all normal business hours. If you prefer to work from a lot of different coffee shops, hiring an agent can give you that luxury. In some states, an agent can also give you an extra layer of privacy by keeping your home address off the public record, too.
Failing to maintain a registered agent is a recipe for disaster for an S corporation. For starters, you’ll lose your good standing in your state. You could even face administrative dissolution. Plus, practically speaking, if your S corporation was summoned to court and no agent was around to receive the summons, you might find yourself in serious trouble. See dissolution definition.
If you ignore a summons, a court might automatically award the settlement to the plaintiff — meaning you’d be out substantial cash. Additionally, failing to show does your business’s reputation no favors.
Let’s say you don’t have a registered agent right now because your old agent resigned, or you served as your own agent and can’t anymore. First, don’t panic; this is actually a pretty simple problem to fix.
Then, pick your new agent (who meets the state’s legal requirements). After that, you’ll need to file a form with your state. Some states call it the Change of Registered Agent form, but it goes by other names. Typically, this form requires information about your new agent, including their name and registered address. Some states also require the new agent to sign to show that they consent to the appointment. There’s usually a filing fee, but it’s generally pretty manageable.
Our registered agent service makes it easy to keep a registered agent for your S corporation. We discreetly accept any legal notifications from the state and process servers and only forward the essentials to you — no sorting through spam or worrying about receiving legal summons in front of a customer. We can also help you with ongoing compliance, such as annual reports and other business amendments. With our help, you can focus only on what matters: making your business succeed.
Are there any entity types that don’t need a registered agent?
The only business entities that don’t have to appoint a registered agent are unregistered entities like sole proprietorships or general partnerships. While these are still legal entity choices, they lack personal liability protections.
What are the criteria for making an S-corp election?
To make an S-corp election, a business must be a domestic corporation or limited liability company with 100 or fewer shareholders or members. All of the shareholders/members have to be natural persons or certain trusts and estates. If the entity is a corporation, it can only have one class of stock. Certain business types, such as financial institutions, insurance companies, and domestic international sales corporations can’t make an S-corp election.
What are the benefits of electing S-corp status?
A business entity that elects to be taxed as an S corporation enjoys pass-through taxation, even as a corporation (see pass-through taxation definition). That helps the shareholders avoid double taxation of the business income.
Additionally, members of an S corporation can pay themselves “reasonable compensation” as a salary and distribute the rest as member distributions. This process can reduce the overall burden of self-employment taxes.
Why can’t I just use a post office box as my agent?
Mailing addresses and P.O. boxes don’t meet the statutory requirements for a registered agent. That’s because whenever a legal notice is given, it must be delivered directly to a person. So an agent must have a physical presence in the state, and they must be present at their listed street address during normal business hours.
Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
Written by Team ZenBusiness
ZenBusiness has helped people start, run, and grow over 700,000 dream companies. The editorial team at ZenBusiness has over 20 years of collective small business publishing experience and is composed of business formation experts who are dedicated to empowering and educating entrepreneurs about owning a company.
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