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Should You Use An Ohio Statutory Agent Service?

Should You Use An Ohio Statutory Agent Service?

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Should You Use An Ohio Statutory Agent Service?

An Ohio Statutory Agent (also referred to as a registered agent or resident agent in some states) is a person or company designated to be the official point of contact for a company.

The purpose of a Statutory Agent is to receive service of process (legal mail such as a summons, subpoena, or lawsuit) and forward it to the appropriate person in the company. The state requires a Statutory for an Ohio Limited Liability Company (LLC), corporation, Limited Liability Partnership (LLP), or Limited Partnership (LP), but sole proprietorships and general partnerships do not need one.

Also See: Guide to starting a business in Ohio

What are the Requirements of Ohio Statutory Agents?

The requirements for registered entities to have a Ohio Statutory Agent are found in Ohio Statutes § 1705.06 (LLC)1 and § 1701.07 (corporation)2, which states that registered entities will have and continuously maintain a Statutory Agent. 

In addition to the state legal requirement, if a process server is unsuccessful in reaching the company’s Statutory Agent, the court can proceed with legal proceedings, which could result in a judgment being placed against the business. Additionally, by not maintaining a Statutory Agent, an entity may lose its good standing with the state, and the owners may lose their liability protection.

There are a few requirements to be a Statutory Agent in Ohio, which include:

  • An Ohio resident 18 years or older may be appointed. Alternatively, a registered business entity, such as a Statutory Agent service, may be appointed.
  • Having a physical address (often referred to as a registered office or principal office). This can be the actual address of the business, the home address of an owner, or even the address of a friend or family member. PO Boxes and mail drop services are not allowed to be used since someone has to be available to sign for documents.
  • The agent generally being available to receive service of process on behalf of the business during normal business hours, normally between 9 a.m. and 5 p.m.

Why Hire An Ohio Statutory Agent Service?

Provided that the owner lives in the state of Ohio and is generally available at a specific address during normal business hours, they can be the Statutory Agent. While this is the easiest and least expensive option, some business owners choose to hire a Statutory Agent service. The main reasons to do this include:

  • Privacy: The Statutory Agent’s name and address are listed on the State of Ohio business database. This can be concerning if someone is running a small business on the side and doesn’t want their employer to know about the business. Also, if the business is sued, the notice will be delivered to the registered office address and employees, customers, or even neighbors could witness the event. Last, if the registered office address is the owner’s home address, there is also the remote possibility of a vindictive litigant or upset customer finding the address and showing up at the business owner’s home.
  • Availability: Ohio requires the Statutory Agent to be available at the registered address during regular business hours. The biggest issue with availability, especially if a home address is used, is if the agent goes on vacation or is otherwise away for some period of time and can’t be reached.
  • If the Business Expands to Additional Locations: If the business has a physical presence in multiple states (offices, warehouses, employees, etc.), a foreign entity registration will often need to be filed with those states and would require that a Statutory Agent be appointed in each state.
  • Due Date Reminders: Statutory Agent services often provide state report reminders, which is nice to ensure the entity remains in good standing with the state.

How much does an Ohio Statutory Agent service cost?

There is no cost for the business owner to be the Statutory Agent. If a commercial Statutory Agent service is hired, expect to spend between $100 and $150 per year, depending on the services that are provided.

Northwest Statutory Agent is a popular Statutory Agent service that charges $125 per year and offers several extras, such as document scanning and mail forwarding. It’s also worth noting that some entity formation companies, like Bizee, include a Statutory Agent service at no cost for the first year when you register your corporation or LLC with them.

How Can A Statutory Agent Be Changed In Ohio?

To change a Statutory Agent in Ohio, submit the Statutory Agent Update Form along with the filing fee to the Secretary of State. In addition to filing this form, the LLC operating agreement or corporation bylaws should be updated to include the new Statutory Agent’s information.

Sources

  1. Ohio Statutes § 1705.06 ↩︎
  2. Ohio Statutes § 1701.07 ↩︎

Should You Use An Ohio Statutory Agent Service?

Should You Use An Ohio Statutory Agent Service?

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