A registered agent is the individual or business entity that receives legal documents from the state, and then forwards them to your business address. But why is this a requirement, and who should you designate as your registered agent in Michigan?
In this guide, we will break down all the details you need to know about Michigan registered agents.
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What is a Michigan Registered Agent?
One of the most common questions we receive from entrepreneurs in Michigan is why a registered agent is required to form an LLC or corporation. While it might seem like an unnecessary middle-man type of role, the registered agent fills a vital role.
The registered agent’s job is to provide a reliable way for the state to contact an official representative of your business at any time, which is especially important if your business is ever sued. If you didn’t have a registered agent, a lawsuit could progress through the courts without you even knowing about it, which is obviously far from ideal.While Michigan does not provide a recommended list of registered agent services, we reviewed the top options and compiled a list of the best Michigan registered agent services based on price and overall value.
Who Can Be a Michigan Registered Agent?
In Michigan, a registered agent must be either an individual resident of the state, a domestic corporation or LLC, or a foreign corporation or LLC with a certificate of authority to transact business in the state. In any case, the registered agent must have a physical street address in Michigan in order to qualify to serve.
Aside from the legal requirements, an important aspect to discuss is who should be your registered agent. You have the right to declare yourself as your own registered agent, which has its pros and cons.
On the positive side, you can save some money by not paying anyone to serve as your agent, but you’ll also likely need to make your home address a matter of public record, which is not ideal. Additionally, you’ll need to be physically present at your business during all standard operating hours (9-5, M-F).
Some entrepreneurs like to have a friend or family member serve as their registered agent, but if that person doesn’t have experience in this position, they might not know what is expected of them. In addition, designating your lawyer or accountant as a registered agent can work, but these options are usually quite expensive.
Our preference is to hire a professional registered agent service, which provides a combination of convenience, affordability, and peace of mind that is unrivaled by any of these other options.
How Do Michigan Residents Get Served?
The most important part of a registered agent’s role is being served a summons.
In Michigan, before a summons can be served, a lawsuit must first begin. This happens when a plaintiff files a complaint to the appropriate court which describes the nature of the dispute and includes the remedy being sought. After the appropriate fee is paid and the complaint is filed with either the district court (for claims of less that $25,000) or the circuit court (for claims of more than $25,000), then the summons may be processed.
If these steps are all taken correctly, the state of Michigan will then allow a summons to be served to the defendant’s registered agent.
How to Designate a Michigan Registered Agent
The answer to this question depends on what type of business you’re starting, but with either a corporation or an LLC, you’ll need to designate your registered agent when you form your company.
When establishing an LLC, you’ll be required to list your registered agent in Article IV of the Articles of Organization for use by Domestic Limited Liability Companies. Alternatively, if you’re forming a Corporation, you’ll need to designate your registered agent in Article IV of the Articles of Incorporation for use by Profit Corporations.
Again, it should be noted that in some documents, the statement of Michigan refers to registered agents as “resident agents”; there is no difference between the two terms.
How Can I Change My Michigan Registered Agent?
If you would like to change your registered agent for any reason, the process is pretty simple.
All you need to do is complete the Certificate of Change of Registered Office/Resident Agent form. The document can be completed in its PDF form and then mailed to the Michigan Department of Licensing and Regulatory Affairs, or it may be submitted online at www.michigan.gov/corpfileonline.
The fee for changing your registered agent is only $5.00 and is payable either by check, money order, or credit card.
How Does a Michigan Registered Agent Resign?
Sometimes, a registered agent may have to resign from their position.
To step down from an appointment, a registered agent needs only to complete the Resignation of Agent form which asks only for the Bureau identification number, a short statement of resignation, and the signature of the resigning agent. The form may be completed here as a pdf file and mailed to the office, or it may be completed online through the Corporations Online Filing System. The filing fee for this form is $5.00.
Why Should You Hire a Professional Michigan Registered Agent Service?
Hiring a professional registered agent is basically the best of both worlds between serving as your own agent, and designating a lawyer or accountant.
The biggest benefit in our opinion is the privacy protection this allows, as you will be able to keep your personal address private. There’s also a major advantage compared to having an attorney or accountant serve as your agent, namely the fact that registered agent services are almost always much cheaper.
Another reason we like this option is that these companies specialize in providing quality registered agent service. They know exactly what’s expected of them, and there are rarely any issues to speak of.
The other major benefit of hiring a registered agent service is that most of them operate in all 50 states, so that if you ever want to expand your business into another state, you won’t need to hire an additional registered agent. Your same registered agent will be able to provide the coverage you need in your new state, while still providing the same service in Michigan. If you hired a lawyer or accountant, they would only be able to help you expand to a new state if they have another physical office in that state.
You Stay Compliant
Finally, most professional registered agents operating in Michigan offer some sort of compliance calendar. With this service, your registered agent helps you keep track of due dates for ongoing LLC maintenance requirements like annual reports, which is a valuable bonus.
The top registered agent service providers include some other appealing attributes, including access to their extensive customer support networks. Some of them include a full year of registered agent service with any business formation package, which can be a real money-saver. Another welcome attribute is that some registered agent services provide volume discounts if you require service in multiple states, or if you prepay for multiple years.
What Is the Penalty for Not Designating a Registered Agent in Michigan?
You need to have a registered agent to form your limited liability company or corporation in Michigan in the first place, but if you let your registered agent service lapse, there could be some serious consequences.
Failure to maintain a registered agent could lead to your business losing its good standing with the state of Michigan, and the state also has the right to officially dissolve your LLC if they choose to.
Another issue would be the difficulty of being served if your business is sued. If the state cannot get ahold of your registered agent, a court may decide to go ahead with the lawsuit without your knowledge, which could even lead to a judgment against you. This can happen not just if you fail to designate a registered agent, but also if your agent is not present during business hours to accept the document delivery.
As you can see, the task of designating a registered agent for your Michigan business isn’t quite as easy as just writing down your own name.
There are significant downsides to just about every option in our opinion, but we recommend hiring a professional registered agent service because that option has the fewest disadvantages. They charge affordable rates, and you never have to worry about losing your good standing, having your LLC or corporation dissolved, or having a lawsuit proceed in your absence.
If you have any further questions, you can contact the Michigan Secretary of State:
State of Michigan Department of Licensing and Regulatory Affairs
2501 Woodlake Circle