Forming a business can be a relatively lengthy and complex process. Or, at least, it used to be before sites like Incfile and LegalZoom came into being. Whether you're setting up a brick-and-mortar business or running your operation entirely online, you need to get all your documentation in order before selling a single product.
What We'll Cover
But, which is better, LegalZoom or Incfile? Unfortunately, it's impossible to answer without first reviewing a few variables and situational elements. However, by the end of this comparison guide, you should be armed with enough information to make the right choice for yourself and your business. Here's everything you need to know about LegalZoom vs Incfile.
What is LegalZoom?
LegalZoom is a website designed to help businesses and individuals access various legal documents and assistance. While many of these services are geared toward forming companies like LLCs, LegalZoom covers many other topics as well. The site was founded in 2001 and has helped millions of businesses and families get the legal help they need for various situations.
In addition to business formation, LegalZoom helps with trusts, wills, copyrights and trademarks, and more. Users can also get legal advice from a real lawyer, should they need it. Overall, this site is like a one-stop shop for all kinds of legal documents and assistance, allowing users to get access to these items without having to pay a retainer.
What is Incfile?
Incfile is a site dedicated to helping entrepreneurs start their businesses. Since 2004, the site has helped over 800,000 companies file the correct paperwork for all company types, including C corporations, LLCs, S corporations, and even nonprofits. Incfile offers access to various documents and tools, including employer tax IDs, virtual addresses, registered agents, and even tax consultations.
Another valuable component of Incfile is that it offers a ton of helpful information for new businesses. The site's resource center can help entrepreneurs learn more about how to file a DBA, different state requirements for starting a company, and even a business name generator.
Which is Better LegalZoom or Incfile?
As you can see, while there is some overlap, both sites cater to slightly different audiences. LegalZoom focuses on the legal side of running a business or starting a will, while Incfile is solely dedicated to helping entrepreneurs. So, it's hard to say whether one is "better" than the other. Realistically, you can use both sites to achieve different goals. That said, let's break down the areas where these sites overlap so you can determine which one might work best for your particular situation.
Costs and Fees
The amount you pay for each site depends on what you're trying to get. Here's a quick breakdown of the different fees you have to pay for specific features, like:
- Business Formation - LegalZoom charges $79 to file your business paperwork. This fee is on top of any state fees you may have to pay, which vary from one state to the next. Incfile doesn't charge anything on top of state fees.
- Registered Agent Services - When forming an LLC, you need something called a registered agent to act on behalf of your business. LegalZoom charges $299 per year for these services, while they're free for the first year through Incfile. After the first year, you pay only $119 annually.
- Employer ID Number (EIN) Registration Services - If you want to get your EIN for free, you can contact the IRS directly. However, if you want to avoid messing around with that, you can pay LegalZoom $79 for their efforts or Incfile $70 for the same service.
- Operating Agreement - LLCs and corporations need operating agreements that outline the structure of the business. Incfile provides an operating agreement for free with your formation paperwork. LegalZoom, however, charges $99 for this document.
As you can see, Incfile costs a lot less across the board. So, if you're looking to save some cash when starting your business, choose Incfile.
Ease of Use
Both sites are very user-friendly and easy to navigate. Also, each site offers comprehensive customer support, although you must submit your query within certain hours. Email is often the best way to get help, but both sites have customer service agents available by phone as well.
If you're strictly trying to start a business, Incfile's layout is a bit more streamlined because the entire website is dedicated to helping you succeed. By comparison, many pages on LegalZoom aren't related to starting a new company, so getting lost is a bit easier.
Breakdown of Features Available on Each Site
Rather than scroll through each site to see what they have to offer, here's a breakdown of the different services you can find on both LegalZoom and Incfile.
- Business Formation - Entrepreneurs can file paperwork to start an LLC, corporation (both C and S-types), nonprofit, or DBA. The site can't necessarily help you form a partnership or sole proprietorship, so keep that in mind.
LLC Formation Guide - Creating an LLC requires more steps than just filing formation paperwork. LegalZoom offers a "Next Steps" guide to ensure you don't miss anything and wind up on the wrong side of the law.
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- Lifetime Customer Support - Even if you don't have an active account with LegalZoom, you can still access customer support to help with any services you've used. Phone support hours are between 7 a.m. to 9 p.m. PST Monday through Friday and 9 a.m. to 6 p.m. on weekends. Email support is available anytime, but there are no guarantees regarding when someone will respond to your message. Usually, responses happen within 24 hours or less.
- Registered Agent Services - A registered agent can act on behalf of your business, including if you get into legal trouble. If you're forming an LLC, you must have a registered agent, although you can act as your own agent if you like.
- Compliance Calendar - LegalZoom can help you stay compliant with local laws and regulations, so you never miss a deadline for filing renewals or new applications.
- Tax Help - While you should work with a certified business accountant, LegalZoom can also help you figure out your tax situation, so you don't run afoul of the IRS.
- EIN Registration Services - As we mentioned, you can work with the IRS directly or use LegalZoom to get your EIN.
- Contracts and Agreements - Here is where LegalZoom shines. You'll need various legal documents when running a business, and you can find templates on the site and get advice from lawyers on how to make sure your contracts are legitimate.
- Intellectual Property Protection - If you have to worry about patents, copyrights, or trademarks, LegalZoom can help you get the proper paperwork to protect your IP. These services work for both physical and digital property, like logos or marketing materials.
- Business Formation Services - As we mentioned, you can start an LLC, corporation, or nonprofit with Incfile. Forming these businesses is also cheaper if you choose the basic membership package.
- Registered Agent Services - Incfile acts as your registered agent, and since the first year is free, you might as well take advantage. You can also use that first year to determine if you want to use someone else as a registered agent, such as yourself.
- Trademark Filing - While Incfile doesn't offer as many intellectual property protections as LegalZoom, you can file a trademark and get legal assistance when doing so. Incfile can also look up previous trademarks to see if yours will infringe upon any existing entities.
- EIN Registration - If you don't want to deal with the IRS, Incfile costs a bit less to register and receive an employer ID number.
- Document Templates - Like LegalZoom, you can find templates for various business-related documents, such as operating agreements and bank resolutions. There are fewer options here than on LegalZoom.
- Business Resource Center - This resource center offers valuable information on everything from managing your business finances to getting help with taxes. You can also download eBooks and white papers that outline how to start and run a business from scratch.
- Online Business Dashboard - With so many items to keep track of, it's easy to get overwhelmed and disorganized. Incfile keeps everything in one place with an easy-to-use dashboard system.
- Website and Email Setup - All modern businesses need a website to reach new customers. Incfile also acts as a domain host and website builder so that you can start immediately. However, if you want to build something more comprehensive, we recommend working with a dedicated web builder platform like Wix or WordPress.
Who is Incfile Best For?
If you're just trying to start a business from scratch and want to do it as affordably as possible, Incfile is one of the most valuable resources out there. Not only can you take care of filing and registration, but you can also access tons of useful information to help your new company thrive.
Who is LegalZoom Best For?
If you need extra legal services or want to take care of personal legal documents (i.e., wills and trusts), it makes sense to start a LegalZoom account. Also, if you know you're going to need assistance from an actual lawyer, it's much cheaper and more accessible to use this site than to contact a law office directly.
Bottom Line: Is LegalZoom Better Than Incfile, or Vice Versa?
When it comes to forming a business, both sites offer very similar features and benefits. However, Incfile has a slight advantage because its singular purpose is to help entrepreneurs build their companies from the ground up. That said, LegalZoom is an excellent online resource for various legal documents and advice, meaning you could wind up using both sites simultaneously.
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