Incorporation can be a fairly time-consuming process, especially if you are new to the legal specifics involved in an entity formation. While the creation of an entity can be pretty straightforward, it’s the little details with the paperwork that matter the most and which can be handled smoothly by an LLC service. And a reliable LLC set up service is not as common as you might think, though there are plenty of companies who offer this service.
If you are ready to form an LLC but unsure which service to choose, this overview may be a step in the right direction for you. The two companies in questions are currently among the most popular formation services, though each comes with certain pros and cons. All of this and more will be examined in this IncFile and LegalZoom comparison review, from pricing to extra features and customer support.
In the context of LLC services, good value is typically used to describe the volume of features/services a formation company is willing to offer and how it compares to their monthly or annual rates.
So the real question is, does their service justify your investment or should you look elsewhere? As far as LegalZoom is concerned, you will likely be paying for their experience given the longevity of their operation and sheer name recognition in the industry. Their rates start at $79 + state fee to form an LLC for the most basic plan which is somewhat barebones but their more expensive plans are much more comprehensive.
IncFile will form an LLC free of charge with their base plan, though their other packages have more additional features. Given that the rate starts at $0 + state fee, this option is generally more attractive to many small business owners.
As we dive deeper into this comparison of IncFile vs LegalZoom, the differences as well as similarities between the two will hopefully become clearer.
The main difference between the two can be found in their pricing. Where LegalZoom charges $79 to create an LLC—plus state fees and additional services if needed—IncFile is more accommodating in this regard, offering an entirely free option among its LLC formation packages. This contributes to many customers choosing IncFile over LegalZoom, though some people don’t stop at their base plan. You can see details on their two other plans to make your final decision.
By comparing the features included in the base plans offered by the two services, it’s pretty clear that IncFile is a more financially viable option. They not only include a year of registered agent service with their free plan, but also provide 30 minutes of business tax consultation.
In contrast to that, the most basic LegalZoom formation package is rather sparse given its steep $79 price. The plan doesn’t include a registered agent either, leaving you no other option other than purchasing it separately for $299.
With more than 4 million successfully created entities under their belt and over 22 years of experience, LegalZoom has a much higher client volume than most and is rightfully considered to be one of the most experienced formation services. IncFile has also had plenty of years operating in the industry, having opened in 2004 and conducted over 250,000 formations.
LegalZoom may be known for their high formation numbers but they do attract somewhat mixed feedback, mostly to do with support and cost inconsistencies. IncFile isn’t exactly the beacon of positivity in this regard, though they do have more positive reviews than negative ones, they certainly aren’t a shining example of a company with universally positive feedback. Still, reviews are very positive with IncFile on the subject of customer care and general billing issues.
General ease of use is perhaps one aspect in which both services are on equal footing. Both websites are well-matched in terms of response times and interface intuitiveness, though many users still prefer IncFile.
One of LegalZoom’s drawbacks is the inclusion of quite a lot of add-ons. This not only makes placing your order longer but also can impact the overall costs.
Given the scale on which LegalZoom operates, it’s natural that they have one of the most extensive support systems but the consistency of expertise provided by their representatives tends to vary.
IncFile is similarly expansive, but this means that the wait for rep response can be quite long, sometimes even dragging past 24 hours.
LegalZoom has extended customer service hours for online queries from 5:00 am to 7:00 pm PT on Mon-Fri and from 7:00 am to 4:00 pm PT on weekends.
IncFile can be contacted by phone and online from Monday to Friday between 9:00 am and 6:00 pm CST.
The turnaround times of many companies depend on the state of formation and operation, including IncFile. This means that the processing can be inconsistent, taking between 8 weeks and 2 days.
With LegalZoom, there are expedited processing options. They can speed it up to a week, though it depends on the level of service: 30 days for the Economy plan, 15 days for Standard, and between 7 and 10 days for Express Gold.
As long as you have paid for your order and created a personal account, you can check for real-time order status updates in your profile. Both services offer online tracking in this exact format, though some find IncFile more accessible.
All new entities with limited liability are required to designate a registered agent (either a professional service or a private individual) for handling the communication between the state government and company owners such as receipts, relevant mail, service of process, important document deliveries, and more.
IncFile actually provides a registered agent service for free in their starter plan with the subsequent annual fee of $119 after one year of operation. LegalZoom is considerably weaker on this front, only offering this service for an extra fee or as a part of more expensive LLC formation plans.
IncFile and LegalZoom both offer a good choice of additional features, though LegalZoom is much more expensive and selective about it.
At the same time, the company not only sells business services but also providers plenty of personal services, from drafting of wills to handling divorce papers.
They also share quite a few of these offers between them, doing business as (DBA) names, providing registered agent service, sending annual reports, and handling foreign qualifications.
|Service||Annual Fee||Registered Agent||Key Benefits||Rating|
+ state fee
|1 year free |
+ $119 annually
|Free Starter Plan||★★★★★ (4.8/5)|
Express Gold: $349
Both companies are quite capable, especially compared to the potential costs that come with hiring a corporate lawyer. Even though IncFile proves to be the best option financially, there still might be some reservations left regarding compatibility. Despite LegalZoom’s higher prices, they are often the first choice of many experienced owners.
As long as you choose their Silver plan, previously priced at $49 but now reduced to $0 plus state fee. That’s the only thing you will be paying for here while getting the services of a registered agent and free consultation to boot.
The general consensus seems to be that the Gold package is the best choice out of the three available plans, regardless of entity size. A free subscription is all well and good, but if you want more extensive features at a fraction of a cost compared to what is offered by other companies, then the Gold plan is your choice. More information about their plans can be found on IncFile’s pricing page.
As mentioned before, IncFile is one of the longest-running services in the industry with a stellar track record. For a more detailed take, be sure to check our past reviews: IncFile vs Northwest Registered Agent and IncFile vs ZenBusiness.
IncFile may not avoid upsells completely, but compared to the frankly outrageous LegalZoom upselling practices amounting to $1,080, the company comes off as fairly modest in terms of add-ons.
IncFile can refund an order only if the company has yet to submit your payment with the state, but keep in mind that there is a $30 charge for cancellation.
This is where LegalZoom wins over a great many formation services—by providing a 60-day refund guarantee. It’s perfectly possible to cancel their services within the first two months and get a full refund without jumping through any additional hoops or paying cancellation fines.
IncFile estimates their processing times based on local review speeds. Depending on how fast any given state processes orders, the company alters its processing times. LegalZoom goes a bit farther than that, offering expedite processing with their premium plans. For instance, their Express Gold plan can process an order in 7-10 days.
Many entrepreneurs actively choose this course of action, preferring to form their own LLCs without any outside interference.
Neither company supports this service, though they can provide information on certain state-specific requirements. If you need to take care of your NY publication requirements, there is always ZenBusiness to consider. For more information, feel free to check our review on the subject.