Are you looking for the best online incorporation service, but you’re not sure which one is the right choice for you?
In this comparison, we’ll walk through the five main factors you need to consider when choosing between these services. Which one is the better overall option?
Comparison of 5 Key Points
In our review and comparison of each online incorporation service, we performed a “stress test” on each based on 5 key factors:
- Compared pricing and features.
- Analyzed their track record.
- Tested the quality of customer service.
- Evaluated each service’s ease of use.
- Reviewed the turnaround times for incorporating online.
That said, as you’ll see in our review of these five key factors, Incfile wins out as the much better incorporation service. They are FAR cheaper, have more features and very positive customer reviews online.
Overall Pricing and Value
LegalZoom: LegalZoom is one of the most popular services available, but we found that does not translate into better value for their customers. While LegalZoom does offer a $149 package to incorporate, the number of upsells can get overwhelming — and expensive. Furthermore, they do not include registered agent service with any of their formation packages, and there’s a variable fee of $159-299 per year to add on.
Incfile: For only $0, the lowest price we’ve seen for this combination of features, Incfile will help you form your business, while also providing a full year of registered agent service. Once the first year is over, the registered agent service will renew for $119 per year, which is a strong price point. In addition, their $149 Gold package and $299 Platinum package are both packed with valuable features that make them strong options as well, even at their higher price points.
Winner = Incfile
Incfile blows LegalZoom away when it comes to pricing and value. Not only are Incfile’s price points much lower than LegalZoom’s, but they also include a full year of registered agent service, which LegalZoom does not. This category is not close at all.
Company Track Record & Experience
LegalZoom: LegalZoom was founded in 1999, and they’ve served 3.6 million customers since then. While their focus isn’t solely on business formation services, they have helped form over one million businesses to date. If you look through LegalZoom customer reviews on any third-party site, you will almost always find a large number of one-star ratings and equally as many five-star reviews, resulting in a decidedly more mixed bag of feedback than many competitors have.
Incfile: Incfile was founded in 2004, and they’ve formed over 250,000 businesses since then. Customer reviews are a major strength for them, as they have thousands of positive reviews across the web, and just a small handful of negative feedback.
It’s a tie!
LegalZoom definitely has the edge when it comes to experience, as they handle a higher customer volume than just about any other company in the online incorporation services industry. However, Incfile has an equally significant advantage when it comes to customer reviews, as they have overwhelmingly positive feedback compared to LegalZoom’s mixed bag.
Overall, these companies are equal in this category, although if you have a strong preference between experience and reputation, you may prefer one or the other.
LegalZoom: LegalZoom offers phone and email support. We reached out twice via the email form on their site, but it took them a full week to respond. The response we received was generic – thanking us for reaching out, but not answering our question.
When we contacted them via phone, our question was answered very thoroughly. The representative went into detail about our different options, and then sent us an email with their direct extension so that we could reach out directly with questions. Overall, while their customer service via phone is great, their online support could be improved.
Incfile: Incfile offers phone and email support, which we tested. When we used their phone support, our call was answered quickly and our question was answered, but not elaborated upon. We also emailed them with the same question after-hours and our email was answered by 10 a.m. the next day, with more details than we received over the phone.
Winner = Incfile
This is a pretty close category, but ultimately Incfile’s quick response times gave them the edge in our opinion. We’ll also note that by reading their customer reviews, we got the impression that more clients are impressed with Incfile’s customer support than LegalZoom’s.
Ease of Use
LegalZoom: Unlike most competitors, LegalZoom doesn’t give you your package options to begin the application. Instead, you enter your personal info first, then navigate through a series of rather costly upsells before you select your formation package. It’s a bit convoluted, and it can result in some surprisingly high price points by the time you work your way through the order form to the package select screen.
Incfile: As you walk through the process of signing up for Incfile, your steps are personalized based on the state you’re forming a business in and the type of business you wish to establish. There are even little question marks and hyperlinks throughout the application to learn more about a specific question or entry on the form. There are a few upsells and third-party offers to navigate through, but if you opt into any of them, your total price is immediately updated on the screen. There are never any surprises with Incfile.
Winner = Incfile
Incfile’s ordering process is much more straightforward and streamlined than LegalZoom’s, especially considering how it almost feels like the LegalZoom order forms start at the end and work back to the beginning, by making you select your add-ons before you decide what you’re even adding them onto.
Speed of Formation
LegalZoom: Unlike most competitors, their turnarounds are based on which package you order, rather than which state you’re forming in. With their most expensive package, you could receive your finalized business formation documents in 7-10 business days, but their cheaper packages take as long as 30 business days (six weeks).
Incfile: Incfile guarantees that every LLC or corporation formation will be processed and forwarded to your state of formation within one business day. Many competitors make you pay an additional fee to get next-day processing. If you need your business formed in a hurry, Incfile offers the ability to order expedited state processing for an additional fee (determined by your state), or you can purchase their Platinum package which includes expedited service.
Winner = Incfile
We always prefer companies like Incfile that base their turnaround times on the requirements of each state, rather than LegalZoom’s approach of varying turnarounds based on how much money you spend on their platform. Furthermore, in most states, Incfile’s processing times are faster than those LegalZoom will give you with their less expensive packages.
Incfile is truly one of the best companies in the online incorporation industry. Their prices and value are outstanding, their customer feedback is fantastic, they have great customer support, their ease of use is high, and their turnaround times are fast.
LegalZoom is a quality company as well, but they honestly don’t even hold a candle to what Incfile offers.
If using the service that has the most experience and the biggest advertising budget is your priority, LegalZoom could be worth a look. For everyone else, Incfile is the better option.
What Is the Biggest Advantage of Each Service?
LegalZoom’s only significant advantage over Incfile is their experience. LegalZoom has served millions of customers over the years, which is a much larger quantity of clients than Incfile’s 250,000+ customers served.
Incfile has quite a few advantages over LegalZoom, but in our opinion, the most important one is their customer feedback. While LegalZoom and Incfile both have plenty of reviews available online, Incfile receives excellent average rating scores, whereas LegalZoom has a mixed bag of feedback.
Which Is the Best Package From These Services?
Not only is Incfile’s Silver package ($0 + state fee) our favorite option that’s available from these two companies, but it’s also one of the best business formation packages available anywhere.
With the Silver plan, you’ll receive the preparation and filing of your articles of incorporation, along with 12 months of their registered agent service. It’s an excellent bargain that includes everything you need and nothing you don’t.
Which Company Offers More Help With Ongoing Compliance Requirements?
You’ll find plenty of valuable tools to help your company stay compliant with either of these companies, but obviously they do vary when it comes to pricing.
With LegalZoom, you can get registered agent service for a variable rate of $149-299 per year, while their annual report service has a very reasonable rate of $55. Incfile provides your first year of registered agent for free, after which it costs $119 per year. They also offer annual reports, but this service has an annual fee of $88.
Can I Get a Refund if I Need One?
LegalZoom’s refund policy is about as good as it gets in this industry. If you want a refund from LegalZoom, all you need to do is request one within 60 days of your purchase date. They will refund your service fees in full, with no questions asked and no cancellation fees charged.
The news isn’t quite as positive for Incfile, as their refund policy is rather restrictive. You can only request a refund from Incfile as long as they haven’t yet submitted payment to your state government, which is typically within 24 hours. After that, they do not provide refunds for any reason.
Which Is the Better Option if I Need Publication Service?
In some states, you need to publish your company’s formation in a regional newspaper. For example, Arizona and Nebraska require publication for LLCs and corporations, New York requires it for LLCs only, and Pennsylvania and Georgia have this requirement for corporations only.
Unfortunately, neither Incfile nor LegalZoom provide any form of assistance with publication requirements. If you’re opening a business in any of these five states, you’re on your own when it comes to publication.
That said, if you’d like to use a service that offers publication services as well as business formation, look into ZenBusiness. To get an idea of how their services stack up to other options, see our comparison to LegalZoom.
Am I Required to Use a Company Formation Service?
You are not legally required to use any sort of professional service to help form your business entity. If you would rather form your own corporation or nonprofit corporation, we have a detailed step-by-step guide that you can reference throughout the process.
However, you should know that the corporation is a complicated business structure in general, and we don’t usually recommend forming your own unless you’re already experienced with the incorporation process.