As you’re likely aware, maintaining a registered agent in Maryland is a necessity for any business entity, but hiring a registered agent can also be a real lifesaver.
Maryland registered agents are a vital part of the formation process. They’re also beneficial when it comes to meeting compliance filing requirements set by the Maryland State Department of Assessments and Taxation Charter Division. By issuing compliance alerts for things like your Maryland annual report, you’re far less likely to miss important deadlines!
Keep reading to find out what a Maryland registered agent is, how to find the best one for your business, and why it’s necessary.
What Is a Registered Agent in Maryland?
A Maryland registered agent stands watch at your Maryland registered office address during normal business hours to receive legal notices, service of process, and mail from government agencies on behalf of your Maryland business.
It may seem ridiculous to send all of your business’s mail to another person at a different address, but that’s why the second half of a registered agent’s duties is document delivery.
Maryland registered agents use mail forwarding or online document management systems to make sure business owners receive their important legal documents—like service of process—and are up to date on important filing deadlines with the State Department of Assessments for things like annual reports.
If your company is listed as any sort of business entity (Maryland corporations, LLCs, and sole proprietorships), it will need to maintain a registered agent in every state it conducts business in. This means that you’ll either have to designate someone who’s already present at each of your company’s local office branches or hire a professional registered agent service.
Sometimes a Maryland registered agent is also referred to as a statutory agent or resident agent, so if you see these terms just know that they refer to the same business service.
What Is the Purpose of a Registered Agent in Maryland?
I’m guessing that once you read the definition for a Maryland registered agent, you hatched a scheme to establish a PO box for your company that you check for service of process and business mail frequently. I’m here to tell you that your plan won’t work, and here are three reasons why.
First, your Maryland resident agent is required to be physically present at your business address during regular business hours to receive mail and service of process on behalf of your Maryland business. The most important term there is physically present. So as a Maryland registered agent, you’re not allowed to just check your mailbox at times that work for you.
Second, the Maryland State Department of Assessments and Taxation Charter Division requires your registered agent’s address to be a physical street address, which means you definitely can’t use a PO box.
And third, there are lots of other things that your Maryland resident agent can do for you!
Compliance
Remembering compliance deadlines with the State Department of Assessments and Taxation is all but impossible due to the fact that many of them only come once a year. But your resident agent, or registered agent, can make this task a lot easier by keeping track of the deadlines and issuing compliance alerts or annual report reminders as they approach.
You can think of your Maryland resident agent as a sort of go-between between you and the Maryland State Department of Assessments and Taxation. When an important filing deadline (like your annual report) approaches, your resident agent will issue a compliance notification that will remind you about it and help preserve your company’s good-standing status.
Management of Important Documents
The address you use on your formation documents is important for more reasons than simply meeting the physical address requirement.
It’s also where your mail, legal documents, and service of process will be sent, and it’s important that you have access to these, read them, and keep them for your company’s records.
Most registered agent services (or the good ones, anyway) provide online document management systems for not only document delivery purposes but also for document management and storage. When they receive a document or service of process, they scan and upload it to the portal that day for you to access with an online account.
Document delivery of this sort is much faster than basic mail forwarding, which is essentially waiting for documents to arrive via the postal system—twice. You can also use the portal to manage your legal documents, and it serves as online storage, as well, which will save you space and time fiddling with hundreds of physical copies.
Who Can Be a Registered Agent in Maryland?
Registered agents and resident agents nationwide must meet a few universal requirements:
- State laws. Some states have established laws specifically for resident agents. To make sure you’re in compliance with regulations regarding your registered agent or resident agent, you should brush up on Maryland state laws.
- 18+. All Maryland resident agents must be at least 18 years of age.
- Physical address. The Department of Assessments stipulates that your registered agent’s address must be a physical street address. A PO box simply won’t do.
- Who you designate. As long as they meet the other requirements, you can designate literally anyone you want as your Maryland registered agent, or resident agent. You could designate a family member, friend, or professional (like your lawyer) as your registered agent. Just make sure they’re trustworthy and available during normal business hours.
What Happens If My Business Operates Without a Registered Agent?
In a scenario where your Maryland registered agent or resident agent isn’t present at your business address during normal business hours to accept service of process from a process server, the process server will move to Plan B: Deliver the service of process to the State Department of Assessments and Taxation Charter Division instead.
As considerate as this service is, the Department of Assessments now has your legal notices, not you, and you have no idea they even exist. From here, a court can follow through with legal proceedings and issue a default judgment without your presence or defense.
Failure to maintain a registered agent in Maryland or to meet compliance filing deadlines (for annual reports) means that your business isn’t meeting its legal obligations. Because of this, the Maryland Department of Assessments and Taxation can rescind your good-standing status. This can devastate your business. It could be disqualified from receiving business loans, expanding to other states, or even doing business legally in the state of Maryland.
Losing your company’s legal good standing means that it forfeits rights to use its business name in the state. Once your business name reservation is no longer active, other businesses can reserve and use it themselves. The worst part is that even if you rectify the situation in a timely manner, you could lose the right to use your business name forever.
If you own a limited liability company, you should know that losing your good-standing status can be a deadly blow to your company. Without good-standing status, the Department of Assessments could move forward with what’s known as “administrative dissolution.” Administrative dissolution is when the Department of Assessments removes the legal authority from a limited liability company to legally operate in the state. It happens as a result of a company’s failure to meet its legal obligations (like maintaining a registered agent in Maryland or meeting compliance filing deadlines).
Domestic and foreign LLCs operating without legal LLC designation are playing with fire. Without the usual safeguards of limited liability protection, the business owner is left holding the bag if the business is sued. Their personal and financial assets are vulnerable in the event of a lawsuit.
The consequences of failing to maintain a registered agent in Maryland aren’t exclusive to LLCs. A lot of the negative effects I’ve covered here also apply to other business entities, such as corporations and sole proprietorships.
Can I Be My Own Registered Agent in Maryland?
There’s no law in the United States that prevents you from being your own registered agent. But before you make that decision you should read about the pros and cons of being your own registered agent vs hiring a Maryland resident agent service.
Cons of Being Your Own Registered Agent
Liability
Arguably the biggest drawback of being your own registered agent is the serious consequences of missing a service of process. This could lead to loss of good-standing status or default judgments. It’s a lot of hassle that no one wants to deal with.
Lack of Privacy
If your business doesn’t have a street address, you’ll have to use your home address and it will be available to the public. The problem with your personal information being listed on the public record is that everyone has access to it, which means that cybercriminals and hackers can use it to steal your identity and trash your credit score.
There’s also something about everyone having access to your phone number and home address that’s creepy enough to make your skin crawl.
Time
Being a registered agent is a time-consuming job, as is being a business owner. As your own resident agent in Maryland, you’ll need to be available during regular business hours and present at your principal office address to receive service of process and legal mail.
The problem is that your business likely operates during the same hours, and unless you’ve figured out the key to being in two places at once, you won’t be able to effectively perform both jobs simultaneously.
Pros of Being Your Own Registered Agent
There’s one good thing about being your own resident agent in Maryland: no fees.
Considering the potential risks and time you must dedicate to being your own registered agent, the fees that professional resident agent services charge are well worth it.
Ultimately, the decision whether to hire a Maryland registered agent service is one that only you can make. With that said, I always recommend that new businesses hire a registered agent service or resident agent service.
Should I Use a Registered Agent Service?
There are loads of reasons to hire a Maryland registered agent service:
- Because many registered agent services provide compliance notifications, you can breathe easy knowing that you won’t miss an important filing deadline.
- Your business is less likely to miss a service of process, lose its good standing, or suffer default judgments.
- With a Maryland registered agent service you’re free to run your business efficiently because you won’t have to be both business owner and registered agent.
- If you operate in more than one state, you won’t have to designate multiple agents if you hire a national registered agent.
- If your business doesn’t operate during what are considered normal business hours (restaurants, movie theaters, dance clubs, etc.), hiring a registered agent service means you can get some sleep during the day instead of pulling double duty as a registered agent.
- A Maryland registered agent service can keep your personal information off the public record because you can list your registered agent’s name and information in lieu of your own.
- A registered agent service can deal with your junk mail. This may seem like a trivial service, but businesses are sent a ridiculous amount of junk mail, and as your own registered agent or resident agent you’d be forced to dispatch it yourself.
- If you select a premium registered agent service, you can enjoy premium registered agent services, such as the payment of state fees and special types of business insurance.
- If you choose a Maryland registered agent service that also provides business formation services, you can take advantage of promotions like free registered agent service for a year when you register for its formation services.
What Is the Best Registered Agent Service?
There are many factors to consider when it comes to choosing the best Maryland registered agent service. Here are some of the things you should keep in mind:
Service Features
You need a resident agent in Maryland that provides all the services your company needs. Plenty of Maryland registered agent services with full service catalogs will meet your needs at affordable rates, so there’s no reason to settle for less.
Value
A good metric to measure the quality of a resident agent or statutory agent is to compare its registered agent service list with its price. Awide variety of registered agent services at a low price is a good value.
Stay away from “budget” registered agent services. These cunning companies use low prices ($39–$59 per year) to draw in new customers before tacking on loads of additional fees for essential services like compliance alerts and online document management systems. Beware of budget registered agent services and avoid them at all costs!
Easy Sign-Up
Another hallmark of quality registered agent services is an automated sign-up process. No business owner wants their time wasted during the formation process—it’s stressful enough without added headaches.
Some registered agent services have sign-up processes that take weeks or months to complete and require loads of paperwork on your end. Instead, stick to resident agent services with quick and easy sign-up processes.
User-Friendly Interface
Anyone that’s ever used software for work on a daily basis knows what a pain bugs and glitches can be.
Some resident agent services have systems that are so confusing even tech support doesn’t seem to fully understand them. Look for a registered agent service with an easy-to-use system and save yourself some hassle.
Customer Service
No matter how great a company’s service catalog is, how great its price is, or how user-friendly its interface is, you’ll still inevitably have to call your registered agent’s customer service for one reason or another. And because your registered agent is such an important business service, it’s crucial that it has excellent customer service.
I used all of these rating factors, as well as my four-stage investigative process to determine that Northwest Registered Agent is the best registered agent service. If you’d like to learn more about registered agent services or about how to choose the best registered agent for your company, read my guide, Best Registered Agent Services.
Conclusion
New business owners are bombarded with tons of new information, procedures, and regulations.. On top of all of that, you also have to remember compliance filing deadlines. But registered agent services can help lessen some of this workload and make the job of being a business owner a little easier.
If you’ve yet to choose a structure for your business and you’re interested in learning more about the LLC formation process, check out How to Start an LLC. If you’d like additional support to get you through the formation process, read the Best LLC Formation Services.
Maryland Registered Agent FAQs
What’s the Difference Between a Commercial and a Noncommercial Registered Agent?
According to the Model Registered Agents Act, a commercial registered agent service is one that’s registered with the state government. In some states, every professional registered agent service must register as a commercial registered agent.
A noncommercial registered agent is any individual or business entity that hasn’t registered as a commercial agent. If you’ve designated a family member, like your mom, as your registered agent, then congratulations! Your mom is officially a noncommercial registered agent, and you’ve given her something to do with her free time!
How Do I Change the Registered Agent for My LLC?
If you’re dissatisfied with your current statutory agent, the good news is that it’s relatively easy to change agents in Maryland. All you have to do is fill out and submit a Resolution to Change Principal Office or Resident Agent form. Although the name is a mouthful, it’s not difficult to fill out.
All you need to do is add your new registered agent information. Your registered agent will need to confirm its appointment and confirm the registered agent information you’ve entered by signing the form. And there’s a $25 filing fee for submitting the form.
How Much Does a Registered Agent Cost?
The cost of your registered agent depends on several factors, such as which provider you ultimately choose and which services you require. But generally speaking, a registered agent can cost anywhere from $39–$299 per state, per year.
If you’d like to learn more about registered agent pricing and services, check out the best registered agent services.
