Many people who operate a business from their homes choose a limited liability company, commonly called an LLC, as their business structure. Even if they began their business as a sole proprietorship, entrepreneurs often find that the advantages of an LLC are sufficient to justify a change in structure. Since an LLC is considered a separate entity, you receive greater protection for your personal assets, including your home. One of the drawbacks of an LLC is that you must have a registered agent in every state in which you have a business presence. Your registered agent must have a physical address in the state and be available during normal business hours to receive legal documents such as subpoenas, writs, and summons. When you chose your registered agent in Texas, you had a couple of options: you could ask a friend or relative who is always at home during business hours to agree to be your registered agent, or you could hire a company for the job. However, over time, you may find that you need to change your registered agent. Perhaps your friend or relative will be relocating to another state, or maybe your hired agent has announced another price increase that you do not feel you can afford. Whatever the reason, it is neither expensive nor difficult to change your registered agent in Texas.
What You Will Need
You will need to obtain a Form 401 from the Texas Secretary of State. The form can be found online at https://www.sos.state.tx.us/. You can enter your information before or after you print the form. You will need to submit two copies of the completed form with your filing fee, which is $15 as of December 2019.
What Information Must You Provide on Form 401?
You may need to research your files to make sure that you enter the correct information on the form. It asks you for the name of the entity as it appears on your original filing and the file number that the Secretary of State’s office assigned to your entity. You will need to provide the name and address of your current registered agent. In the next section, you will be asked to enter the name and business address of your new registered agent. Next, choose whether you want the change to become effective as soon as the Secretary of State processes it, on a specific date that is no more than 90 days after you sign the form, or when a certain event triggers the change. If you choose the last option, you must specify the event that will trigger the change. Lastly, you must sign and date the form.
Potential Pitfalls When Changing Your Registered Agent in Texas
Although the process is relatively simple, there are a few things you should be aware of that could potentially cause problems.
1. If you do not file Form 401 within 30 days of a change, you could be faced with a monetary penalty. Prior to submitting the change notice, if there is a failed attempt to serve your company with a legal notice, your registration could be revoked due to your failure to maintain a registered agent.
2. The person you designate as your registered agent must have provided his or her consent in either electronic or written form. It is not mandatory to submit a copy of their consent, but you may choose to do so, and you certainly want to retain a copy for your own files.
3. The business address of your registered agent must be the same as the registered office’s street address. The address cannot be a lockbox or post office box, nor can it be solely a telephone answering service.
4. Depending on the structure of your business, you may need to ensure that the person signing the form is authorized to do so. For example, if you are the sole owner of the LLC, you might need to include your title or the capacity in which you are signing the form.
5. You can pay the filing fee with a credit card, money order, or check. Checks and money orders must be drawn on a U.S. financial institution or bank. If you pay with a credit card, 2.7% can be added to the filing fee as a convenience fee.
Can I Serve as My Own Registered Agent?
Your entity cannot be its own registered agent, but you or your employee can. However, this is not usually a good idea. Keep in mind that you or your registered agent must always be available at the physical address during business hours. This can seriously limit your ability to call on customers, travel, or take any personal time off. In addition, the names and addresses of registered agents are considered public records. If you are trying to protect your privacy, this can be a major drawback.
Can PhysicalAddress.com Serve as My Registered Agent?
At PhysicalAddress.com, we offer home-based businesses an economical way to secure a virtual physical address. Furthermore, we do not charge our clients for serving as their free registered agent in Texas, Nevada, Florida, California, or New York. You can check our prices by clicking on this link. If you have questions, you can reach us at 844-888-6364.