Founded in 2001, LegalZoom is the oldest and largest of the competitors we reviewed. They are the 800 lb gorilla of the online legal services world. They offer a host of legal services in addition to incorporation services. Like many large incumbents, we feel they have rested on their laurels. They advertise a $0 filing service (only pay state filing fees), however, once you pay for an EIN, Operating Agreement, and for their Registered Agent service, you will end up paying more for your business registration. We don’t recommend them because of these fees which will cost you more than other alternatives (like our recommended filing service Bizee). In addition, we have heard the most complaints about LegalZoom’s customer service relative to their competitors.
Read our full guide on: Business Formation Services ⚖️
LegalZoom is an online legal technology company that provides legal services and documents to individuals and businesses to help them create legal agreements and take care of other common legal needs without hiring a lawyer.
Brian Liu and Brian Lee founded LegalZoom in 2001 after realizing there was an opportunity to provide affordable online legal services to consumers and small businesses. Despite initial challenges like the dot-com bust and pushback from lawyers, they bootstrapped the company by coding the website themselves and relying on search engine marketing in its infancy. LegalZoom grew steadily as Liu and Lee focused on driving revenue through targeted marketing rather than expensive traditional advertising. The company went public in 2021 and is now valued at $2B and generating over $640M in revenue.
Typically, we put less emphasis on public review sites, but for this category, many of the options have thousands of reviews on TrustPilot, and the process for incorporating is typically very standardized. This increased our trust in their ratings, and the ‘wisdom of the crowd’, so we’ve taken them into account in our recommendations, but with one big caveat. As we dug into the TrustPilot scores, we noticed some discrepancies. One tool had one 5-star review, but their Trustpilot rating was 3.7. How could this be? We found that the TrustPilot score takes other factors into account like the age of the company and responding to negative reviews. We’ve calculated the TrustPilot score based on a simple weighted average and not taken the headline TrustPilot score. As with all our guides, we’ve tried to be guided by the data.
As you can see in the chart below, LegalZoom has a TrustPilot score of 4.4 (with over 3k reviews). We do note that LegalZoom offers other services in addition to their core filing service that some of these reviews might be reviewing. LegalZoom has good reviews but not the best of the services we compared.
Comparing pricing between business formation services is a difficult task. Many companies will charge high add-on fees for things that other companies will include standard.
When it comes to comparing prices, you should be aware of two aspects: the cost to file your business, and the cost to maintain your business (Registered Agent fees). This section will focus on the cost to file your company and the next section will focus on the cost to maintain your company.
When filing your company, we view a couple of elements in addition to the core filing as essential: an Operating Agreement, EIN, and the first year’s Registered Agent service. The charts below compare the total price of filing across each of the major filing services including these essential elements.
LegalZoom is the most expensive of the services we reviewed. It will cost $458 plus state filing fees to incorporate your business. This is much more expensive than other competitors including Bizee (Incfile) and ZenBusiness. In this case, we don’t think you get a better service with LegalZoom than you do with the other alternatives, so we don’t generally recommend it.
The major ongoing service related to your business filing is Registered Agent services. Many companies include the first year of Registered Agent services for free in their offerings and then charge steep fees after year one. This is an easy way for these companies to make additional money because it’s very easy to fall back on the business you filed your company with for ongoing Registered Agent services.
For LegalZoom, it will cost $299 per year to use their Registered Agent services after year one. Again this is the most expensive pricing of the competitors that we reviewed.
When comparing processing times, there are two elements to consider. The first is how long it takes the service to file with the State for you once you have provided the necessary information. Then there will be the time that it takes for the State governments to process your business filing paperwork. This typically takes 1-2 weeks but depends on the State where you are filing. The government processing time will be the same no matter which service you use.
The typical turnaround time for LegalZoom is 1-2 weeks. This is a bit slower than other competitors which typically turnaround filings in less than 5 business days.
LegalZoom offers phone support which is available Monday - Friday from 5 a.m. to 7 p.m. PT and Weekends from 7 a.m.–4 p.m. PT in addition to email and chat support. However, it’s important to note that LegalZoom only offers phone support for those on the Pro and Premium plans.
Of all the legal filing services we reviewed, we heard of the most issues with LegalZoom’s customer support. Customer’s were frustrated at the lack of attention and help from the company.
We love LegalZoom’s money back guarantee. They offer a 60-day money back guarantee that will give you all of your money back (less state filing fees) without any additional fees or charges.
Like many filing services, LegalZoom offers three pricing tiers: Basic, Pro, and Premium.
Starter plan
The Basic plan is LegalZoom’s most affordable offering. It will cost $0 to file, but you will be required to pay State filing fees (which typically range from $50 to $200 and depend on the State where you are filing).
The starter plan includes:
This is the most basic package and you will need to pay for additional things we view as essential like an Operating Agreement and EIN from the IRS.
Pro plan
The next tier up called the Pro package includes the state filing plus an Operating Agreement and an EIN from the IRS. We view these as essential so recommend those that go with LegalZoom to choose this tier. The Pro plan costs $249 plus state filing fees. We note that the Pro plan does not include Registered Agent services for your first year which will cost $249.
The Pro plan includes:
Premium plan
The final tier is called the Premium package and costs $299 and includes everything in the Pro package in addition to guidance from a business attorney. It’s important to note that the Premium plan does not include Registered Agent services for your first year which will cost $249.
The Premium plan includes:
LegalZoom partners with Bank of America and Novo to offer business banking. However, we don’t recommend this for most businesses. You can read our full guide on business bank accounts, but the TLDR is that we recommend Mercury. They don’t charge a monthly fee, have higher FDIC insurance amounts, and better integrations than other offerings.
What is LegalZoom used for?
LegalZoom is an online legal technology company that provides legal documents and services to individuals and businesses. Some of the common services LegalZoom offers include help with forming LLCs, filing trademarks and patents, creating wills and trusts, incorporation services, and assisting with other common legal paperwork. LegalZoom aims to make legal services more accessible and affordable by providing DIY document templates and access to legal plans and advice online.
How legit is LegalZoom?
LegalZoom is very legit. They have helped over 4 million people form businesses. They also have over 3k reviews on TrustPilot with an average rating of 4.4 stars.
Why not use LegalZoom?
The main reason not to use LegalZoom is its pricing. It will be more expensive to file and maintain your business than key competitors including our recommended filing service (Bizee).
Is LegalZoom a good way to set up an LLC?
We think LegalZoom is an okay option for forming an LLC. We think their service offering is decent but their pricing is more expensive than key competitors.
Is LegalZoom expensive?
Yes, LegalZoom will be more expensive to file and maintain your business than key competitors including Bizee and ZenBusiness.
Is LegalZoom a good registered agent?
We think LegalZoom is an okay Registered Agent. The main issue we have with LegalZoom’s Registered Agent services is pricing. You can receive similar levels of service for cheaper rates using their competitors.
Is it easy to cancel LegalZoom?
Yes, it’s relatively easy to cancel your LegalZoom subscription; you can call them at (800) 773-0888, Monday to Friday 5 a.m.-7 p.m. PT, or Saturday to Sunday 7 a.m.-4 p.m. PT. You can also email them at customercare@legalzoom.com to request to cancel.
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