Whether you are opening a new business or running a current one, handling the nitty-gritty details, including trademark application, document review, LLC operating agreement, LLC formation agreement, etc., can be a bit challenging- especially if it’s your first business.
Nevertheless, there is a way around these hurdles, in the form of online legal service providers that hold your hand and take you through the entire business registration process. Among industry leaders include LegalZoom, CorpNet, Rocket Lawyer, MyCorporation, and Legal Nature.
Most small business owners looking to register their businesses had to contend with paying steep attorney fees. Fortunately, thanks to LLC formation firms, you can get access to a lawyer and other relevant legal documents at a fraction of the cost.
In this LegalZoom review, we shall be going through the entire step-by-step process of registering your business with the service provider. I shall let you know my thoughts regarding their services, pros, and cons of using LegalZoom.[toc]
LegalZoom LLC Review- Background
With its headquarters in the Greater Los Angeles Area, West Coast, Western Us, LegalZoom opened its doors to clients in 1999. “Our North Star is to democratize law,” John Suh- LegalZoom CEO. The firm’s goal is to make legal help accessible to average Americans.
Interestingly, certain parties found them a threat and decided to investigate why the company was formed. Despite the initial opposition, LegalZoom has over the years grown into the juggernaut we know today.
By abiding by the principles of caring, knowledge, and firm understanding of what start-ups and small businesses need, LegalZoom has expanded its operations to the UK.
Over time, slightly over 4 million people have relied on the firm’s personal and business expertise. An additional 2+ million have either sought out assistance with opening or running their businesses.
A strong team forms the basis of any successful business. A quick look at Legal Zoom’s lineup, you get a sense of confidence and professionalism. Most of them are seasoned professionals with years of experience.
Legal Zoom LLC Review- Business Entities
If you are looking at operating a business, it is always wise to register it with the state. Not only does this ensure that you remain in good books with the authorities, but it also comes with its perks.
Legal Nature can assist you in registering your business as:
Limited Liability Company
To date, nearly 1.6 million entrepreneurs have used LegalZoom services to form their LLC. LLC’s typically require fewer formalities, including having a board of directors or shareholders.
Additionally, it protects you and your personal assets. Forming an LLC offers you tax flexibility, making it a worthy investment.
C-Corps are the most prevalent of corporations. A C-Corp is a legal business structure for a corporation in which the shareholders and owners are taxed separately from the entity. They are mandated to hold AGM’s and have a board of directors, who are voted by shareholders.
S-Corporations tend to pay fewer taxes than other corporations. This is because shareholders file their taxes using the company’s income and losses as their own. The main advantage of opening an S-Corp is to avoid double taxation and liability protection.
Doing Business As (DBA)
You can open a DBA for as little as $99 +state filing fees. Setting up a DBA ensures you comply with the law. It also enables small business owners to open a business account under the business name. Additionally, it helps distinguish your enterprise from your competitors.
Non-profits take profits from goods, services, sponsorships, or donations and channels them into the organization to further accomplish its goals. If you consider leaving a positive impact on society, consider registering your business entity as a non-profit.
This will offer you protection against possible law-suits. Additionally, non-profits stand to benefit from tax relief by the IRS.
Legal Zoom LLC Review- Product Features
For the discerning client, LegalZoom offers 3 different packages:
Economy LLC package
The package costs $79 + state fee filing (please note that this fee varies from state to state). It features comprehensive state and federal name availability search, LegalZoom Peace of Mind Review, Articles of Association, LLC Filing, and Comprehensive LLC Welcome Packet, and much more.
Standard LLC package
The standard LLC package retails for $329 + state filing fee. The packages turn around period is 15 business days. You get to enjoy all the “Economy” benefits as well as 1-2-1 Customer Support, Founder’s Kit, Business Newsletter.
Express gold package.
With a turnaround period of 10 days, the Express Gold package is the right selection for those looking for the best value. It retails for $349 + state filing fee.
Included are the “Standard” package benefits along with LegalZoom VIP Processing, Priority Filing, Express Shipping, 7-days A Week Lifetime Customer Support, and Exclusive LegalZoom Discounts.
What I love about LegalZoom is they truly simplify the business registration process. If you have no clue where to start, you can visit their knowledge center or have a chat with their executives. As for me, I knew what I wanted (an LLC set-up) and quickly identified it on their webpage.
The first step is to fill in your choice of a business name. LegalZoom conducts a name search against their library to ensure that the name is available.
The next stage is choosing your state of formation. Most entrepreneurs tend to file in their home states. But, it’s possible to file in a different state than your home state. I opted for Delaware due to the state’s conducive business environment, i.e., law courts and taxation.
Assuming the name clears the search, step three involves providing your email address or telephone number. This is optional. It will be used in relaying information regarding your order.
Pick the right option. You don’t have to overthink this step as it isn’t that important.
And more pleasantries.
Please give a clear description of the business’s primary activities.
Back to the pleasantries.
True to their word, LegalZoom does all the heavy lifting so that you don’t. Depending on the data you provided, the company compiles all the essential services you will require to open your business.
As part of the business formation requirement, each business needs to have a registered agent service at all times. Did you know you could legally be your own registered agent? This position comes with strict conditions, including being available at all times during official business hours.
If you think that you may not manage to meet these requirements, there’s the option of having LegalZoom act as your registered agent. At a fee, of course.
An operating agreement is a vital legal document used by LLCs. It outlines the company’s financial and functional decisions, including provisions, rules, and regulations. Each year, businesses are required to file taxes. Hence, US businesses are required to have an Employer Identification Number.
Other than used to file business taxes, it’s used in opening a bank account under the business’s name, payroll, etc.
Any business owner can apply for EIN through the IRS official website for free. But, if you lack the time or will to come up with both documents, LegalZoom is more than willing to assist you- for a fee as always.
LegalZoom offers free 10-day legal protection, compliance to protect your personal assets. If you wish to keep this business service, you can opt to make monthly or yearly payments to keep the service.
For $39.99 per month, you receive peace of mind knowing that your business receives legal assistance. You also get unlimited 30-minute consultation with an independent lawyer, along with unlimited access to legal documents like an operating agreement.
To remain compliant and avoid fines or loss of your business license, you need to ensure that the business complies with state and federal laws. For $280 per year, LegalZoom will make a point of adequately opening your business and making sure it remains compliant with the law.
Please note that this feature is optional. However, you get a ten-day free trial included in your package.
Most LegalZoom alternatives tend to feature the packages page within the first steps of business formation. This is not the case here. You have the option to go with the Economy package, Standard, and Express Gold packages.
Please pick a package that best fits your needs. Since I’m in no rush, I opted to go with the firm’s entry-level package for $79 + state filing fee. Most LegalZoom alternatives tend to feature the packages page within the first steps of business formation. This is not the case here. You have the option to go with the Economy package, Standard, and Express Gold packages.
Have you settled on the bank your business is going to register with? If not, LegalZoom offers the opportunity to have an executive from Bank of America call you and open an account with them. This is optional.
However, if you opt to bank with the lender, you stand to receive up to $450 in rewards. I opted not to bank with the lender.
Please take a moment to review your order. You can make any necessary edits before proceeding to checkout.
And just like that, you are done. As an entrepreneur, I must say I am a bit disappointed to find out that LegalZoom doesn’t offer alternatives to paying with plastics. It would have been great having PayPal, Google Pay, and Apple Pay.
I love here that you can make payment in 3 installments if you run short of cash. Aside from the payment options, everything has been smooth and straightforward, as you’ve noticed. Legal Zoom LLC Review- Rating
Legal Zoom LLC Review- Rating
LegalZoom has a profile with the Better Business Bureau. It has a stunning A+ rating and has been accredited since 2001.
Sadly, the business doesn’t fare so well on TrustPilot either. It scores a rating of 2.6.
Legal Zoom LLC Review- Customer Review
Despite having 444 customer reviews, LegalZoom doesn’t enjoy a high customer rating. The incorporation service provider comes below average, scoring 2.04/5 stars. This contradicts the A+ rating.
A quick look at LegalZoom’s profile on TrustPilot paints a gloomy picture. The company has 198 customer reviews on the platform, of which 65% are negative, compared to 26% positive reviews.
Legal Zoom LLC Review- Products
- Limited Liability Company
- Limited Partnership
- Limited Liability Partnership
- Corporate Changes and Filings
- Business Compliance
- Real Estate
- Additional Business Services
Wills and Trusts
- Estate Plan Bundle
- Last Will and Testament
- Living Trust
- Living Will (Advance Directive)
- Financial Power of Attorney
- Health Power of Attorney
- Pet Protection Agreement
- Financial Power of Attorney
- Name Change
- Compare Estate Planning Products
- Probate & Executive Assistance
- Trademark Registration
- Trademark Search
- Trademark Monitoring
- Trademark Statement of Use
- Office Action Response PRO
- Other Trademark Filings
- Provisional Application for Patent
- Patent Search
- Utility Patent
- Design Patent
- Copyright Registration
Speak with An Attorney
- Business Consultation
- Personal Consultation
- Contract and Agreements
- Contract Drafting
- Website Terms & Conditions
- Franchise Disclosures
- Trademark Office Action Response
- Downloadable Forms and Agreements
- LegalZoom rides on the back of its established brand name and awareness. It’s renowned for its LLC formation services, legal documents, and compliance filing, particularly if you need to beat a deadline.
- LegalZoom offers free unlimited name searches. This way, you can check whether your business name is available.
- Setting up a company is quite hectic. LegalZoom has simplified the entire process. Additionally, they have a knowledge center filled with tons of useful information.
- The company only works with seasoned, vetted attorneys.
- LegalZoom LLC’s 60-day satisfaction guarantee if you are not satisfied with the firm’s services. Please note that the refund is minus the state filling fees as the money is paid directly to the state.
- Sadly, the company lacks reliable customer support. A quick look at the various leading customer review platforms paints an image of a firm that’s drowning in complaints. But, the company is doing its best to settle the cases amicably.
- At $79 + state filing fee, LegalZoom has one of the most expensive entry-level LLC formation services, considering rival IncFile offers a $0 + state filing fee.
- Most of the add-ons services on offer are quite expensive.
- Sadly, the firm doesn’t include Registered Agent Service as part of its LLC packages. Additionally, you need to pay for EIN, whereas it’s freely accessible via the IRS’s official website.
LegalZoom is one of the oldest, well-established business advisory plan service providers out there. They offer a wide range of business-related legal options, from creating a business, intellectual property filings, custom legal documents, and attorney consultation.
Its best suited for small to medium-sized businesses that don’t have an in-house legal department and regularly require legal assistance. Navigating through the entire business entity registration is simple and efficient. You don’t require legal experience to make use of their services.
However, the firm’s fees across the formation packages are higher than some of its competitors. Despite this, I would recommend the platform to any small businesses and start-ups. They are knowledgeable and highly thorough.