When you form a Virginia LLC or Virginia corporation, you must name a registered agent and registered office.  Why?  The answer is because of the nature of corporations and LLC’s as separate entities.  In order to deal with these separate entities, we need to connect a real, breathing person to them for official purposes.  This person is the registered agent and all corporations and limited liability companies registered in Virginia are required to have a Virginia resident agent on record with the Virginia State Corporation Commission. 

A registered agent is an individual that receives "official" mail and deliveries on behalf of a corporation or limited liability company. "Official" mail and deliveries generally means communications from either the Virginia State Corporation Commission or from a Court through service by the county sheriff (of a lawsuit, garnishment for an employee, etc.).

There are restrictions on who can be your registered agent and where your registered office may be located.  A shareholder or LLC member may be a registered agent.  A licensed Virginia attorney may be a registered agent.  Your registered agent needs to be located in Virginia at a location that has a street address and where the agent is generally available during business hours.  This means P.O. Boxes, UPS Store boxes, and the like cannot serve as your registered office. 

I serve as the registered agent for more than a hundred Virginia companies and would be happy to discuss this inexpensive service ($125 per year) with you.  Check out my Virginia registered agent website for more details.

Yes!  If you operate a charity in Virginia, you must first register with the state before soliciting contributions.  The Virginia Code requires that before you start soliciting funds from Virginia residents you first register with the state and pay the required filing fee. 

If you’re planning on soliciting charitable donations from more than one state, however, you can file a unified registration statement to save time.  To learn more about unified registration statement, you can visit this site.

I form a lot of Virginia limited liability companies and Virginia corporations for clients.  When deciding what entity to operate a business under, one of the first questions is "what is the difference between a Virginia corporation and a Virginia LLC?"  Here are my top five differences between the two:

1. Cost: to form a Virginia corporation, the filing fee paid to the State Corporation Commission starts at $75.00 and the annual renewal fee starts at $100.00 (both depending on the number of authorized shares of the corporation.  For a Virginia LLC, the filing fee paid to the Virginia SCC is higher - a flat $100.00 - but the annual renewal fee is $50.00, less than a corporation.  So, in the long run, a LLC pays less in filing fees.
2. Flexibility:  LLC’s are less rigid in their structure than corporations, so you have more flexibility in adapting the LLC to your unique business.  The Operating Agreement of a LLC (which you should definitely have if you are a LLC) can be structured in a limitless amount of ways.
3. Annual Reports: Required for a corporation, not required for a LLC.  Less paperwork = good thing.
4. Formality:  A corporation is a formal entity with officers and directors (at least one of each) required.  A LLC, on the other hand, can be "member managed" and run in a less formal way.  For small, start-up businesses, less formality means you can focus on making money rather than administrative work.
5. Tax Benefits:  LLC’s have more options as to how they are taxed.  Corporationc can choose between taxation as a C corp or S corp (if they qualify) while a LLC can decide to be taxed as a  sole proprietorship (if single owner) or partnership (multiple owners), C corp, or S corp.  You can also switch your tax status as a LLC once every sixty months.  More choices are usually better than less.

Those are my top five differences. I’m sure others out there might have additional differences.  Just keep in mind that the major benefit of corporations and LLC’s are the same (assuming you formed your corporation or LLC correctly) - limited liability for the owners.

Welcome to my Virginia business law blog and this first post.  I have been meaning to start this blog for quite some time now and am glad to finally get started.  I plan to use this blog to provide useful information to entrepreneurs and business owners and answer the frequently asked questions that come across my desk.