South Dakota entrepreneurs need to pick a registered agent when they set up a business in the state. All states require a registered agent to be on file with the state.
What’s a registered agent? A registered agent is a person or company that accepts official documents on behalf of your company. These documents are often sensitive in nature and could include things like tax notices or papers served during a lawsuit.
Selecting a registered agent is part of setting up a South Dakota LLC. Part of the LLC formation paperwork requires the company owner to list the name and address of the registered agent.
To help understand who can serve as a registered agent and how to select the best agent for your company, this guide will provide useful information. Since selecting a registered agent is closely tied to setting up an LLC in South Dakota, we’ll walk entrepreneurs through the whole process of establishing a company in the state.
How is an LLC formed in South Dakota?
Forming an LLC in South Dakota is fairly simple. To officially create a business in the state, documents called Articles of Organization must be filled out and filed with the South Dakota Secretary of State. While the process to set up an LLC is similar in every state, there are certain rules that apply only to South Dakota. To make sure your company is legally established in The Mount Rushmore State, follow these steps:
1. Name the company
The state requires all companies to have a name. However, the name is subject to certain rules.
For starters, the company name must be unique. No other business in the state can have the same name. To see if the name is already in use, entrepreneurs need to check name availability online at the secretary of state’s website. Simply run a name search to find out if another company has the same name.
It’s possible to reserve a company name too. If you don’t plan to file LLC formation documents for a few weeks or months but want to reserve the name, you can do so by filing a form and mailing it to the secretary of state’s office. The name will be reserved for 120 days.
Picking a name that’s available is just the first step. South Dakota has a few additional rules you should know about, which include:
- The company name must have “Limited Liability Company” or “LLC” in the name.
- The company name can’t confuse the public into believing it’s associated with the government.
- The state may require additional approvals for certain names.
2. Pick a registered agent
Now it’s time to select a registered agent. As mentioned, a registered agent will receive sensitive documents that pertain to your company. Selecting a registered agent is an important choice. The person or company should be trustworthy and should be able to get in touch with the owner immediately. The kind of documents that are delivered to a registered agent, like tax notice or filings issued during a lawsuit, are important enough to notify the owner within minutes of receiving them.
Once you know how you’d like to select, talk with this person about the position. It’s important that the person be aware of the responsibilities that accompany this role. If the person agrees, he or she will be listed on the Articles of Organization.
3. File the Articles of Organization
The Articles of Organization are the documents that officially form a South Dakota LLC, and they’re next on the to-do list. Business owners can file these documents online or by mail.
The Articles of Organization will ask you to provide the following:
- The company name and address
- The registered agent’s name and address
- A list of managing members
- The purpose of the company
- A list of products or service provided to the public
- The signature of the LLC organizer
It only takes a few minutes to fill out the paperwork, provided you’ve worked through the steps above of naming the company and selecting a registered agent.
The document must be filed with the South Dakota Secretary of State. There is a $125 filing fee to file this with the state. It will take the state several days to approve it. Once approved, your LLC is officially considered a legitimate business in the state.
4. Create a company operating agreement
The state doesn’t require an operating agreement, but it’s a good idea to create one. An operating agreement explains how the company will run and who’s responsible for certain aspects of it. The purpose of the document, especially if there are multiple investors, managing partners, or a board of trustees involved, is to clearly identify everyone’s role. With everything explained, it can prevent problems in the future.
5. Obtain an EIN
Doing business in South Dakota requires an EIN or an employer identification number. This nine-digit number is issued by the IRS during a quick online session. The government will issue the number after an entrepreneur visits the IRS website and answers a few questions.
An EIN is needed to pay taxes, hire employees, and set up bank accounts, so it’s not a step you should skip.
6. File an annual report
All South Dakota LLCs must file an annual report with the State of South Dakota. The state will send reminder notices to a company. Expect to pay $50 to file this report.
What is a South Dakota registered agent?
A South Dakota registered agent is a person or company that receives official business documents for a company. Usually, a registered agent is the company owner or another employee, but a professional registered agent company can also be hired to fill the role.
Do I really need a registered agent in South Dakota?
Yes. The State of South Dakota requires all LLCs to list a registered agent on its LLC formation paperwork and keep the contact updated through the secretary of state’s office.
Can I be my own registered agent in South Dakota?
Yes. The owner of a company can serve as a registered agent. However, the owner may select a different person, like another employee, to serve as the company’s registered agent too. In some cases, the owner hires a registered agent service as opposed to selecting a company employee.
Who can be a registered agent in South Dakota?
In South Dakota, a registered agent can be any adult or company in the state with a physical street address. The person or people at the company must be available during regular business hours to accept documents.
Why would a company choose to work with a registered agent service?
An owner may decide to pay for a registered agent service. A service will accept documents for the company and notify the owner when they arrive. Many of the services have same-day document scans, mail forwarding, and online portals that notify the owner when something has arrived. To understand the benefits of using a registered agent service, here’s a look at some of the perks:
- Convenience. A registered agent service is easy to find and easy to set up. Once in place, an owner doesn’t have to worry about being “on call” to accept documents.
- Peace of mind. Even if an owner selects a trusted employee to serve as the company’s registered agent, something can go wrong. An employee could be absent or misplace documents, for example. For peace of mind, some owners opt for a registered agent service.
- Privacy. Some owners prefer that sensitive papers be delivered offsite. Having important tax notices or lawsuit documents being served at the office isn’t ideal. For privacy’s sake, a registered agent service is ideal.
List of South Dakota registered agent services
There are many qualified registered agent services in the state of South Dakota. To give entrepreneurs an idea of what’s available, here are three options:
- Incfile.com: Incfile.com can help entrepreneurs file their LLC formation paperwork and serve as the company’s registered agent. The online company offers a host of beneficial business services that includes filing reports and other necessary documents with the state. The first year is free. After that, it’s $119 a year.
- Northwest Registered Agent: For $125 a year, Northwest Registered Agent offers an online portal, real-time updates when mail is received, and pricing that remains the same each year. The company offers its services in several states and has years of experience in the field. Additional business services are also offered.
- Swyft Filings: Swyft Filings offers registered agent services that start at $149 a year. Users get an online dashboard, report and filing reminders, and secure document storage for this fee. In addition, the company has a buffet of other business services available when you have a need.
How much does a registered agent service cost in South Dakota?
The cost of a registered agent service can vary. For basic services, where a company receives documents, notifies the owner, and forwards the mail, expect to pay about $50 a year. For more advanced features, like assistance filing additional reports with the state, for example, the cost can go up to $200+ a year.
How does an owner select a registered agent in South Dakota?
A registered agent is selected by registering the person’s name and address with the South Dakota Secretary of State.
Can a company change its registered agent?
Yes. Any company can change its registered agent by filing a change form with the state. A change form may be needed if the employee holding the role of registered agent leaves the company, for example, or if the owner wants to hire a registered agent service instead of serving as the company’s registered agent.
No matter what the reason, the form can be found and filed on the secretary of state’s website. Expect to pay $15 to file the change form.
What’s a statutory agent?
A statutory agent is the same as a registered agent. Different states use different titles. Resident agent or service of process agents are also titles used.
What’s a commercial registered agent?
At some point, an owner may be asked if the company has a commercial registered agent or a non-commercial registered agent. If the company has hired a registered agent service, the company has a commercial agent. If a person, like the owner, is the company’s registered agent, the company has a non-commercial registered agent.