Company Formation

LegalZoom vs LegalShield (2023)

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When it comes to starting a business, forming a limited liability company (LLC) is a popular choice for entrepreneurs seeking liability protection and flexibility.

However, navigating the legal intricacies of LLC formation can be daunting. That’s where online legal service providers like LegalZoom and LegalShield step in, offering assistance and guidance to streamline the process.

LegalZoom boasts a comprehensive range of services, including legal document creation, business services, and attorney consultations. On the other hand, LegalShield is recognized as a reputable provider of personal legal services, offering a range of membership plans tailored to meet various individual needs.

Which company is right for you? 

Below, we compare LegalZoom and LegalShield in more detail, with a focus on their LLC formation services, to help you decide which is the best fit for your needs.

Comparison Chart

Product NameLegalZoomLegalShield
WebsiteStart HereStart Here
PricingTiered pricing with various package optionsSingle packages, subscription plans
Business Types CoveredLLC
Corporation
Nonprofit
DBA
LLC
Other Services OfferedLegal documents, business services, attorney consultationsLegal plans, attorney consultations, document review
Registered AgentAvailable as a separate servicen/a
EINYesYes
Attorney ConsultationsYesYes
Document ReviewYesYes
Turnaround Time2 to 20 business days depending on the plan3 to 5 business days

Company Overview

LegalZoom, founded in 1999, is a leading online legal service provider that has revolutionized the way individuals and businesses access legal assistance. Over the years, LegalZoom has gained a reputation for its user-friendly platform, extensive legal resources, and exceptional customer support.

LegalShield, established in 1972, is a prominent provider of legal plans, offering affordable access to legal services. With a focus on preventive legal care, LegalShield provides subscribers with attorney consultations, document review, and other legal assistance.

How does LegalZoom work?

LegalZoom’s LLC formation services simplify the process of creating a limited liability company (LLC). To begin, users provide information about their business, such as the state of formation and desired company name. LegalZoom then generates the necessary legal documents, including articles of organization and an operating agreement.

Users review and customize these documents as needed. LegalZoom also assists with filing the paperwork with the appropriate state authorities. Throughout the process, customers can access customer support for guidance and clarification.

How does LegalShield work?

LegalShield simplifies the LLC business formation process by offering a single plan called Launch, which includes the necessary services. To get started, users can easily look for the “Forming an LLC” service from LegalShield’s website and accomplish the business formation questionnaire.

The plan includes the Personal Legal Plan and Home Business Supplement, offered at no additional cost for the first three months. During checkout, clients will be prompted to create an account to proceed with the purchase. LegalShield will then require contact and personal information as part of the signup process. Finally, users can submit their payment information to complete the LLC formation process.

Company Formation Plans and Pricing

LegalZoom

LegalZoom offers a range of three LLC formation plans tailored to your specific requirements:

  • Basic ($0 + state filing fees)
  • Pro ($249 + state filing fees)
  • Premium ($279 + state filing fees)

Basic Plan: LegalZoom’s entry-level package is designed for those seeking affordable options. It provides essential services such as a name check service, preparation and filing of articles of organization, and a digital welcome packet. It’s important to note that state filing fees are not included and will apply separately.

Pro Plan: For those needing a more comprehensive solution to ensure full compliance, the Pro Plan is an ideal choice. In addition to the features of the Basic package, it offers an operating agreement, EIN (Employer Identification Number) acquisition, assistance with business licenses, and phone consultations with business insurance and tax specialists.

Premium Plan: LegalZoom’s Premium plan is the ultimate package for LLC formation. It encompasses all the features of the Basic and Pro plans, along with the added benefits of 30-minute legal consultations with an attorney and access to customizable legal forms. Furthermore, you will receive copyright registration services and revisions to your LLC formation documents within the initial 30 days.

The Premium plan grants you access to complimentary attorney consultations for the initial 30 days. Beyond that period, the service automatically renews on a monthly basis at a rate of $49. Additionally, all plans come with a customizable Wix website for your business, providing an online presence to enhance your brand.

Note that none of LegalZoom’s LLC formation packages include a registered agent service. If you require this essential service, you will need to acquire it separately at a cost of $299 per year.

Does LegalZoom form other business entities aside from LLCs?

LegalZoom provides a comprehensive range of business entity formation services, extending beyond LLCs to corporations, DBAs, and nonprofits. With a tiered pricing structure, various business plans are tailored to each type of formation.

Corporation Formation

  • Economy — $149 + state filing fees
  • Standard — $329 + state filing fees
  • Express Gold — $349 + state filing fees

Nonprofit Formation

  • Economy — $99 + state filing fees
  • Standard — $239 + state filing fees
  • Express Gold — $359 + state filing fees

DBA Formation

  • Standard — $99 + state filing fees
  • Premium — $119 + state filing fees
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LegalShield

LegalShield offers a streamlined approach to LLC formation with its exclusive Launch plan. This all-inclusive package is priced at $149, in addition to state filing fees. Launch by LegalShield includes the following:

  • Formation of your single member LLC
  • Consultation with an experienced business formation lawyer
  • Business name check
  • Secure your Federal Tax ID (EIN)
  • Legal document filing to start your business
  • Articles of Organization
  • Three months of legal support for you and your business

What are the benefits of Launch by LegalShield?

Aside from business formation, Launch by Legal Shield comes with a free Personal Legal Plan and Home Business Supplement for three months.

The Personal Legal Plan provides 24/7 emergency access to lawyers, phone consultations for personal matters, coverage for criminal defense in death-related traffic accidents, and assistance with driver’s license reinstatement. With discounted trust preparation available, this plan offers essential legal support for various personal issues.

Meanwhile, LegalShield’s Home Business Supplement is designed to provide affordable legal services for home-based businesses, consultants, and individuals with up to 10 rental properties. With this supplement, you can focus on growing your business while we handle your legal matters.

The plan offers valuable benefits such as advice and consultation on business-related legal matters, designated consultations for specialized topics like tax and trademark issues, document review, collection letters, IRS audit legal services, and a 25% discount on additional legal work.

Keep in mind that LegalShield does not offer registered agent services.

Ease of Use and Turnaround Time

LegalZoom provides a user-friendly LLC formation experience with a guided question-and-answer format. However, during the signup process, users encounter upsells that they need to navigate through before seeing the total cost. Fortunately, clients can opt out of these add-ons or skip them during the final order page or QA process.

The turnaround time for LLC formation with LegalZoom depends on the state’s processing speed. Generally, it takes between a week to ten business days. Some states even issue approval within three business days after receiving your intake information.

On the other hand, LegalShield offers a streamlined signup process for their LLC formation service. Membership applications are typically processed the same day, but it can take up to 48 hours excluding holidays and weekends. During checkout, you can select a time for your small business lawyer to contact you.

While LegalShield’s purchase process is quick and easy, there is some uncertainty about the next steps after submitting payment. It may require additional research or reaching out to customer service to fully understand the process.

Customer Support

LegalZoom offers different support options depending on the plan you choose. With their Basic plan, you’ll have access to email and chat support. However, if you opt for the Pro or Premium Packages, you’ll also have the added benefit of phone support. In addition to these support channels, LegalZoom provides prepaid legal support through its extensive network of independent attorneys.

If you prefer phone support, LegalZoom’s phone lines are open Monday through Friday, from 5 am to 7 pm PT, and on weekends from 7 am to 4 pm PT. Alternatively, you can use the email form on their website to reach out to their customer support team for any inquiries you may have.

In contrast, LegalShield takes a slightly different approach to customer support. They offer a dedicated phone number and email address specifically for member inquiries. Their phone lines are available Monday through Friday, from 8 am to 6 pm CST, and they strive to respond to emails within 24 business hours.

Both LegalZoom and LegalShield go beyond just providing direct support channels. They also offer comprehensive FAQs and a wealth of online articles that delve into the intricacies of the business formation process. These resources can serve as valuable references to help you navigate the legal landscape efficiently.

Verdict

When it comes to selecting a business formation service, two prominent names often come to mind: LegalZoom and LegalShield. While both providers offer valuable services, it’s essential to understand their differences to make an informed decision.

LegalZoom takes the lead in terms of business entity coverage. If you’re planning to form a nonprofit, corporation, or DBA, LegalZoom is the ideal choice. Moreover, LegalZoom offers three distinct plans for LLC formation, ensuring they cater to various budgets and requirements.

For LLC formation, LegalShield’s Launch package can be likened to LegalZoom’s Premium Plan. Additionally, LegalShield’s formation package includes several complimentary legal services for up to three months, whereas LegalZoom’s premium attorney assistance is only free for 30 days. However, LegalZoom holds an advantage with its customizable website feature, which can effectively kickstart your brand’s online presence.

If you prioritize affordable legal assistance for your LLC, LegalShield is a great option. On the other hand, if you’re working with a tight budget, LegalZoom’s Basic Plan will suffice. If you have room in your budget and seek to establish an online presence, the Premium Plan offers a more comprehensive solution.