Taylor Legal Blog

Principal Office and Resident Agent — What's the Difference? [VIDEO]

Posted by Katherine L. Taylor, Attorney and CPA, Chief Problem SolverOct 23, 20240 Comments

{3 minutes to read}  Are you forming or do you own a Maryland Corporation or LLC? Are you wondering what address you should use for your principal office and what person and address you should use for your resident agent? If so, you're not alone because those two positions or concepts frequently get mixed up.

In this article, I'm going to explain what those two concepts represent; and the purposes, required by the state, and then in further articles, I'm going to explain what addresses can be used for a principal office and who can serve as a resident agent in the state of Maryland, and in most other states in the United States

In Maryland and most other states, any registered entity is required to have a principal office and a resident agent. Those two people/addresses need to be outlined in the initial documents when the entity is formed and must be maintained current. If one or the other addresses change, the company's owner has to go into the state website and confirm that the information on the website is current.

What is the Principal Office?

The principal office establishes the location within the state where the company primarily does business or manages its affairs. Look at it as where you can find the people responsible for running the business.

Also, under Maryland law, and in some other states, the principal office serves another purpose under the court laws relating to where a lawsuit can be filed, for instance. In Maryland, a lawsuit against a registered entity can be filed in the county where the principal office is located. That is another thing to keep in mind when you are trying to decide which address is going to be used as the principal office for the company.

What is the Resident Agent?

The resident agent serves a completely different purpose, which is to accept what is called the Service of Process on behalf of the company if the company is sued in the state. Service of Process means the delivery of a summons or a subpoena. In Maryland, the resident agent is required to be that person, but it also can be an entity with an address in the state that is always accessible to the public. So, if any person is suing that company, they know who to reach and to whom to serve a subpoena or summons, if they can't find the company's owners.

So, that gives you some background as to what the principal office and resident agent roles are. In the next two articles, I will explain what addresses and people can be used for the principal office and resident agent.

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https://www.youtube.com/channel/UCLSQcqb98NubiqJIM8WfYOQ