As you fill your registration documents to form an LLC in New Jersey, you will come across the term a New Jersey registered agent and may wonder who this is and why you would need to have one. The state recognizes this agent as a person or a company that you trust to handle your legal documents. Thus, any communication between you and the authorities takes place through an intermediary for an LLC. We will cover why you need to designate a registered agent LLC, who you can choose, and what happens if you skip this step.
What is a New Jersey Registered Agent and is it Necessary?
When starting a business, you probably already know what you need to have to do business in New Jersey. Most people figure that if they already have their details and addresses right, they are good to go. However, when filling the limited liability company (LLC) paperwork, they soon realize that the state requires them to give even more details, including who will represent them when receiving legal documents. An agent comes in to fulfill this role and stands between the company and the authorities.
Basically, all the agent does is receive anything the state sends to you. It can be a lawsuit, a reminder, service of process, or simply a notification from the government. The authorities want to know who they should contact whenever they want to reach you and this is the person or company you need to note down in this section.
Is it important to appoint an NJ registered agent? Why, yes! Think of it like this. Suppose someone has a grievance about your business and wishes to take legal action against you. The authorities would require to serve you papers. If nobody is available to receive them, the entire lawsuit can continue in your absence, only for you to lose. It’s not a risk worth taking and the authorities would frown upon this.
What are the Requirements of a New Jersey Registered Agent?
Please note that the state does not give a list of people or companies who should represent you and receive official legal documents. Instead, it sets out the NJ state’s agent requirements that all people and companies serving this role must meet. They include:
- Being an adult. In NJ, this translates to someone having reached at least 18 years and being capable of entering into a contract. Please read more New Jersey law on who can enter into a contract and who cannot.
- Being a resident of the state when working with an individual. If you choose to hire a company (which comes with many benefits), make sure that it has the right to do business in the state. You can easily do this by searching the state’s database.
- Having both a physical and mailing address. Please note that both are applicable as the authorities must know where they can reach the person or company when needed. The person cannot simply offer a PO Box as this does not provide for situations where physical presence is necessary. For example, if you get served with papers, you require someone to be there and receive them.
Who can be a Registered Agent in New Jersey?
From the requirements, you can see that almost anyone can take on this intermediary role. Even you can do it if you are okay with the responsibilities that come tied to the task. For example, are you willing to be available on workdays in case someone shows up with papers? Let’s look at who can take on this role according to the law.
A professional service
If you look around, you will realize that many people opt to hire a professional registered agent service to serve this role as long as it meets the set-out requirements. In this case, employees of the said service ensure that they receive and deliver your mail and time-sensitive documents to you timely. They can also offer other services unrelated to correspondence.
Advantages
- Discretion: Most people decide to use this option because it allows them to keep their business affairs private. Take the example of people who run their businesses from home. They cannot afford to have people showing up at their doorsteps. Instead, they need a go-between to keep their addresses private. Also, you might not be comfortable hiring an individual to sort through your papers as the information might get out in public.
- Seamlessness: The document processing takes place without involving the business owner and this allows you to focus on your work. Moreover, if you get sued, nobody will show up at your place of work with the papers, causing panic among your clients and employees. You can run the legal and operational aspects separately and ensure stability in your company.
- Follow-Up: It’s easy to hold a company accountable for its actions after you’ve paid your dues and it has not delivered its promise. Say for example you don’t get your paperwork on time, you can threaten to withdraw your subscription. The same does not hold when working with individuals such as family members.
- Coverage: Most companies work in most or all 50 states and once you expand outside New Jersey, you can still access their services, reducing the hassle of the move.
Disadvantages
The major downside to hiring a company is the cost which might seem high for a new business owner trying to make ends meet. However, the value for your money is undeniable.
Individual
You are also free to appoint a single person to serve this role, including you. Some business owners have taken this route in the past and even included their family members to receive their documents. It’s not an issue as long as the person meets the requirements set by the state.
Advantages
- Accessibility: You will have an easy time contacting the person you elect and this makes communication easier. Plus, there will be existing trust between you which may be more comfortable for you.
- Cost-Effectiveness: It is much cheaper to hire yourself or designate a family member to take on this role.
Disadvantages
A major problem with this individual approach is that you will have to be available or have someone available at all hours of the workday. Otherwise, you can miss out on important communication. Additionally, it’s hard to hold a relative or friend accountable if your mail goes missing.
What happens if you don’t have a registered agent?
First of all, the state cannot allow you to start a business without deciding who will serve this role. If you start the business and do not pay for the services after a while, you can miss out on important communication. Plus, a big penalty for not designating a New Jersey registered agent is that you will no longer be in good standing with the state. It can get you into legal trouble. To make matters worse, the authorities can decide to officially dissolve an LLC that is not compliant with the law. It’s not worth the risk.
How to get a Free Registered Agent in New Jersey?
Did you know that you can get agency services for free? It’s quite simple. When you hire an LLC formation service such as IncFile and ZenBusiness to start your company, they throw in free registered agent services for up to a year. You can then start paying in the consequent years, enabling you to save a lot of money on LLC formation costs.
Registered Agent Changes and Resignation
If you are unhappy with your agent and want to change your New Jersey registered agent, the state allows you to do so. All you need is to access the online filing portal and make changes directly in your account for $25. Alternatively, you can wait until you’re filing your annual report and make the changes at the time at a fee of $50.
Many people change their representation when their agents resign. Luckily, they must notify the LLCs they serve of this wish during a 30-day window. It gives you enough time to find someone else and make the change. Please note that if 30 days go by and you are yet to hire someone else, your business will automatically be dissolved.
Have Questions or Concerns?
If you want additional information on designating a registered agent for a New Jersey business, you can access The Division of Revenue and Enterprise Services or the NJ Business Portal. Alternatively, you can call the Trenton office: (866) 534-7789 and speak to someone about your concerns regarding New Jersey registered agents.
The authorities are also reachable on:
New Jersey Department of State
225 West State Street, 2nd Floor
Trenton, NJ 08608
(609) 984-2396