The business landscape has significantly evolved over the years. For one, what it takes to start a business today is nothing compared to what it took 30 years ago- all thanks to the internet.
The internet is largely responsible for most of the innovations that have significantly reduced the risk of doing business. Apart from lessening risks, it has simplified business processes.
With increased competition, scrappy small business owners battle it out against larger, well-established corporations. Fortunately, even a small business owner can hold his own against any industry juggernaut by leveraging the internet.
Like most jurisdictions, any business entity seeking to operate in the US must meet various regulations before receiving their business license. Did you know that even as a foreigner, you can invest in any US economic sector- including real estate?
How you may ask? By forming and registering a Limited Liability Company, you can attain a foreign qualification, effectively permitting you to open a business. Tying back to the internet, there exist several online legal service firms that specialize in LLC formation.
Among the most prolific incorporation service providers include Legal Zoom, ZenBusiness, and IncFile. In pursuit of the mythical American dream, I recently approached the latter seeking legal advice regarding LLC formation.
I endeavor to educate and enlighten you- a small business owner- on the business formation processes through my experience. Are you still reading? Great! Here we go.[toc]
Related: Best Online LLC Formation Service | ZenBusines Review | Swyft filings Review | Corpnet Review | LegalZoom Review | MyCorporation Review | LegalNature Review | Should You Incorporate? | IncFile vs. Corpnet
Any start-up knows the pain of business formation. Countless hours go into researching State, City, and county requirements, drawing an extensive business plan including carrying out SWOT analysis. For most business executives, this is the most dreadful stage of preparing a business.
Subsequently, a group of thoughtful entrepreneurs banded together in 2004 and formed IncFile- a business website set on making registering a business as easy as one-two-three. This way, you can focus on more important things.
In the past, opening a business required the services of an attorney. Most first-time entrepreneurs couldn’t and still can’t afford them, with most charging anything between $100 to $1000 per hour. The same can’t be said about LLC formation firms like IncFile.
Since its inception, the firm has successfully played a role in the formation of over 250,000 businesses. In 2018 and 2019, the company had the privilege of being awarded the prestigious “Entrepreneur 360 Best Company” award to recognize their commitment to growing businesses.
IncFile Entity Types
Incorporating your business calls for keen attention to detail. There’s a lot of thought that goes into the process. Through its various LLC service options, IncFile facilitates the business formation and helps you pick the right entity.
Limited Liability Company- LLC
An LLC business in the US combines a corporation with limited liability and a partnership’s or sole proprietorship’s pass-through taxation. This is essential in protecting both your companies and personal assets.
It’s every entrepreneur’s dream to have their business flourish and expand to new heights. However, this growth comes with additional headaches in the form of taxes. If you wish to keep a larger chunk of your taxes (legally, of course), consider opening an S-Corporation.
Are you a large business intending to trade shares publicly? Then this type of structure formation is right for you. By enabling wider ownership, attracting venture capitalists, potential investors, and shareholders are easier with a C-Corp filing.
You can never forget an act of kindness, even if it’s from a stranger. There are approximately 1.5 million NGOs in the US, making the nation one of the most charitable countries.
Non-Profits are ideal for Schools, Hospitals, Churches, Foodbanks, and Museums. Non-Profits enjoy tax exemptions, discounts on postage and advertisement, and legal protection from the organization’s debts.
IncFile LLC Formation Service Packages
Amazingly, you can open a business for as little as $0 + state fees. IncFile features three packages for the perceptive shopper. These are Silver, Gold, and Platinum.
Recommended: Read our ZenBusiness Review first!
If you are like me and are in no rush- I would recommend the Silver package, which is the entry-level package. Unlike the other three, it doesn’t feature a service fee. Of the three, the most popular is the Gold- it comes with a $149 fee. At $299, the Platinum package offers the best value.
Currently, there’s a 50% & 30% discount on both the Gold and Platinum packages, respectively. Please note that these amounts vary, depending on the state filing fee.
IncFile Product Features
- Preparing And Filing The Articles Of Organization
- Unlimited Name Searches
- Free Registered Agent Service For A Whole Year
- All the silver benefits
- EIN Business Tax Number
- IRS Form
- Operating Agreement
- Banking Resolution
- Express Shipping
- Lifetime Company Alerts
- Online Access Alerts
- Unlimited Phone & Email Support
- Business Banking Account
- Business Tax Consultation
- All the Gold Benefits
- Business Contract Templates
- Expedited Filing
- FedEx Delivery
- Domain Name + Business Email
True to their word, the steps involved in setting up a limited liability company is as easy as ABC. A word of caution, though, it’s pretty lengthy. There are roughly 16 steps- depending on your choice of options- as you will see.
Fortunately, if you are not a huge fan of reading through my explanations, the screen-shots should suffice as the process is that simple. Without further ado, let’s get into the IncFile LLC review.
The first step on your road to incorporation begins with selecting the type of entity you want to register and your State choice. With IncFile, you can set up an LLC, S-Corp, C-Corp, and Non-Profit.
It helps if you already did your homework and identified a state that’s ideal for your business. In my case, I opted for Delaware. Did you know that more than 60% of the fortune 500 companies have incorporated in Delaware?
The State is popular due to the quality of its courts and judges. Also, the State has a strong statute that’s modern and up-to-date.
The second step involves providing your contact information. Please note that you need to fill in your physical address, not a PO Box, as they will be delivering sensitive incorporation documents. The information needs to appear as they do on your government issued ID.
This page indicates the expected time for your incorporation filing will take to clear the state. As previously stated, this period isn’t standard and varies from one state to another. In my case, it should take approximately 15 business days for the business formation to be officiated.
Some entrepreneurs find this too long. If you fall into that category, you have the expedited filing option that takes three days. However, it’s going to cost you.
Step four requires information about your company, including LLC name, designator, business type/industry, number of members, and the enterprise’s purpose. IncFile has gone the extra mile and made arrangements for a professional business address and virtual mall service.
This is particularly meaningful to clients that would love to maintain their privacy. This feature will cost you $29 per month. You are free to cancel at any time. Alternatively, you could go with your address. In my case, I opted to add a level of security and bought into the offer.
This page serves to upsell you additional services. The feature is available across all three packages, i.e., Silver, Gold, and Platinum. If you decide to add this premium service package, you get:
- EIN/Tax number. It serves as an employer identification number. It’s necessary to open a bank account, tax filing, etc.
- An Operating Agreement
- Banking Resolution
- Express Shipping
- Business Contract Template
To simplify things on my end, I went all in. After all, for $99, I’m getting $320 worth of value. Moreover, I simply don’t have the time to come up with all the above. It’s a fantastic bargain!
Remember step-4, where we filled the number of individuals within the company? This is where you provide their details. They could either be people or another business.
Here, you are going to provide details of your registered agent. So long as you possess a physical street address, you could serve as your own registered agent. Please note that IncFile provides you free registered agent service for a whole year, saving you $199.
The IRS issues an EIN Employer Identification Number or a Federal Tax Identification Number. It’s used in reporting business tax, opening a bank account in the business’s name, payroll for your employees.
You could always opt to delegate the task of attaining an EIN to IncFile, which will cost you $70, or apply for one yourself. It’s absolutely free and can be done online through the IRS’s official website. Before doing this, check with your state if you require a state number or a charter.
If you chose to take IncFile legal service assistance in securing an EIN, you would have to fill up this form. If you decided on getting one for yourself, then skip this part.
Fill up your names, SSN, physical address the closest description of what your business is all about. All these are necessary for the IRS to issue you the EIN. One more thing, if you are a foreigner, simply click on the “YES” option to receive further guidance; otherwise, fill in accordingly.
It seems like IncFile is somehow affiliated with Bank Of America. You could consent to have personnel from the bank to get in touch with you and take you through opening an account over the phone.
As always, you could choose not to. Since this is an IncFile review, I opted into most of these “FREE” additional value options to get a feel for the service, but I opted to open the business bank account myself.
If you require a hard copy document for safekeeping, there’s the option of getting them delivered via FedEx Express. This will cost you $25. However, by default, all formation documents are uploaded onto the client’s dashboard to enhance customer service and support the green initiative.
IncFile’s approach to business formation service offers an extensive suite of legal services that simplify opening and growing a business. A good example of this is offering tax strategy/free consultation.
You will learn how your LLC is taxed, how to pick the best IRS tax election, Business bookkeeping requirements, how to reduce the chances of an IRS audit, commonly missed tax deductions, and how to reduce self-employment taxes.
Still with me? Great! You may have noticed by now, most IncFile’s legal services are designed to lighten your load. On this page, they identified the licenses I would require to operate in the state of Delaware. With an additional $99, I could have legal help filing for these permits and licenses.
Verify the business formation data is correct. You can make necessary revisions where applicable. If everything looks fine, click on the “Next” button.
Finally, the payment stage. This where I find IncFile lacking. Like with my previous Zen Business review, they only accept credit card payments. I wish they had multiple payment gateways, i.e., PayPal, Google Pay, Payment via phone.
IncFile Review- Rating
My experience with IncFile hasn’t been that bad, but it falls behind other incorporation firms like Corpnet. A quick look at leading rating agencies paints a picture of a struggling company, especially in customer service.
I should mention, though, most of these negative customer feedback started earlier this year, which lets me know that it’s probably due to the current covid-19 pandemic.
IncFile Review- Customer Feedback
Business Tools & Resources
Starting a business is challenging in many different ways. IncFile provides you with most of the tools and resources you’ll need to succeed. They include:
- Registered Agent Service
- Annual Report
- Certificate of Good Standing
- Change of Registered Agent
- Foreign Qualification
- EIN/Tax ID Number
- Business License Number
- Business Accounting
- Fictitious Business Name
- File S-Corp Tax Election
- They’ve been in business for 16 years. Over time, this has enabled them to open over 250,000 successful businesses.
- Their Silver package is one of the most competitive packages in the market.
- You get a free registered agent for an entire year.
- Unlimited name searches.
- Preparing and filing the articles of organization.
- Tons of useful add ons that make opening and running a business a breeze.
- Despite having my emails responded to in a somewhat acceptable time, going by customer reviews on Trustpilot, Yelp, and BBB, the firm is sadly struggling on other fronts.
- Despite offering free LLC formation, there are lots of upsells, which could end up costing you more than initially planned.
Our Ratings[wp-review id=”15129″]
Recommended: Read our ZenBusiness Review first!
What does the software or service not do well?
IncFile makes the incorporation process simple yet highly detailed. The steps are easy to follow, and you don’t need to be highly knowledgeable to enjoy the service.
What do you need to form an LLC, and can I start on your own?
All you require is a computer, a fast internet connection, and at least an hour. Most of the steps are easy, and you can always reach out to IncFile if you have concerns. I found that the system automatically saves your progress and can pick up from where you left.
Why you shouldn’t use LegalZoom?
LegalZoom and most other online incorporation service providers can’t be used to substitute lawyers. You shouldn’t use LegalZoom if you are facing legal challenges like lawsuits. Always consult your attorney.
The best agent services, what should you consider?
While considering which agent to go with, there’s a multitude of factors you need to take into consideration. Things like customer service, years of experience, past client review, ease of setting up, payment methods, and rating by third party agencies like BBB.
Should I be your own registered agent for an LLC?
From a legal point of view, you can be your own registered agent. All you require is a physical address. But, this might not be a great idea. Why? You may not be available during business hours. You risk your privacy. You may lose focus. You might miss out on crucial mail.
Should I form an LLC for an online business?
Yes. Forming an LLC comes with its benefits. Undoubtedly, of most importance is the protection you get. An LLC separates your personal assets from the business’s assets. Forming an LLC is cheap and simple, using IncFile.
Do you have to pay for LLC every year?
Yes. The annual fee is a recurring fee to be paid to the state of incorporation to keep your LLC in good standing. Depending on the state, this fee could be paid after every year or two.
Should IncFile clients reserve business names before placing your orders?
No. It’s not necessary, but searching for name availability would help secure it ASAP. Click here for more details. Alternatively, you could have IncFile do this for you. They offer unlimited name searches.
Do you need an LLC to start an online business?
No. There’s no legal requirement that you form an LLC to open any business. That aside, it’s worth investing in forming an LLC. It offers you legal protection by separating your personal assets from business assets.
Related: IncFile vs. Swyft Filings