Last Updated on

A question that we get asked after reading our state entity formation guides is whether they should form an LLC themselves, use a formation service or hire an attorney.  As with most things in life there are pros and cons to every decision and this one is no different.  Let’s look at the options.

Doing it Yourself

You are likely here because you read our guide on how to form an LLC yourself.  If you haven’t, be sure to read the guides to forming an LLC in each state

The process of forming an LLC is something many people can do without much difficulty.  The basic process involves visiting the Secretary of State’s website and filling out a form to create an LLC.  Some states are easier than others and it’s very common to come across terminology and steps that aren’t familiar.  This usually leads to concerns of whether the entity formation was done right. Forming an entity is a big step in starting a business and it is helpful to know it was done correctly, which leads us to using a formation service.

Using a Formation Service

Many people are apprehensive at spending money to hire an attorney to form their LLC, but still want some assurance the formation process is being done correctly.

There are several formation services that can do this at a fraction of the price of an attorney (and sometimes at no cost at all).  A formation service simplifies the process and helps walk you through forming an LLC.  These services do this day in and day out so they know the process and are available to answer any questions you may have along the way.    

In addition to simplifying the formation process, one of the overlooked benefits to using a formation service is they provide alerts when reports are due, such as the annual report.  While the state will also send you notification, many times it’s through the mail only.  It’s nice to also have an email alert, as the extra notice helps to make sure this important renewal doesn’t fall through the cracks.  The formation company also keep copies of the formation paperwork and in some cases offer a free registered agent for a certain period of time.

The cost of the formation service is very reasonable for the value they provide.  Prices vary by company and the level of service you want but are usually between $0 – $300, plus state fees, depending on the services requested. 

Using a service lets you focus your time on the dozens of other things you need to get done and the assurance that it has been done right.

Who is the best LLC formation service? 

Unlike the dozens of sites on the internet giving a glowing recommendation that tell you one service is better than another, we aren’t going to do that. Instead we provide a review on several of the more well-known services in the industry and include an overview of what they offer and a video walk-through to see how easy or difficult their service is to use.  

It’s hard to say who the “best” formation service is because really all of the better-known services make it easy to form an LLC and they all offer certain extras that appeal to different people.   We break down each of the company’s services and compare online customer reviews from independent review sites.  While we wanted to use the same sources for all formation companies to keep the reviews consistent, we weren’t able to since there isn’t one source covering every company.

See our in-depth review on forming LLC with each of the services.

Incfile
ZenBusiness
Swyft Filings
Legalzoom

Hiring an Attorney

Hiring an attorney to help with your formation other way to form and LLC.  An attorney is going to usually give the most personalized service, but is the most expensive too. Attorneys will normally charge between $1,000 and $1,500 to form a corporation or LLC. 

Paying for an attorney is your best bet if you want to be completely hands-off in the process, are developing a new product or operate in a potentially dangerous industry.  The attorney is going to advise you based on the industry and personal situation to help identify all the potential issues you may face.   

Wrapping it up

As you can see, there are a variety of ways to get your LLC formed from doing it yourself, using a formation service or hiring an attorney. While you can do it yourself, with the pricing recent battles from the formation companies, several of which lowered their starter package (which is fine for most people) to free, there really isn’t the need to do it yourself.  If your business or personal affairs are fairly complicated, it may be worth spending the extra to hire an attorney.