Your company hires a registered agent (RA) to be the bearer of bad news. It’s strange, but true. Mail from your RA can only mean a few things, none of which you’re looking forward to. The mail could be an annual report notice, which means paperwork. Or it could be tax forms. In rare cases, it could be notice that you’re getting sued.

There is good news. Your RA is actually a friend. When you get mail from your RA you know it’s something that deserves immediate attention. Your RA won’t be sending you any junk mail. Imagine missing a tax filing, or even worse, failing to respond to a lawsuit. Those mistakes have real financial teeth. An agent dedicated to making sure you get notice of those types of things can only be a good thing.

The primary responsibility of an RA is to accept notice of a lawsuit, “service of process” in legalese, and forward that notice to the company being sued. Forwarding annual report filings and tax forms are additional duties required by some states.

RAs must be located in the company’s state of incorporation. If you have an office there, some states let you serve as your own RA. But, at $50-$200 a year, having someone handle all of your most important mail may well be worth it.