Starting a business comes with piles of paperwork. Confusing forms and filing procedures can cause nightmares for entrepreneurs. Many choose to use an online document management service instead.
ZenBusiness and LegalZoom are two of the most popular options. Below, our full comparison review will help you choose between them.
ZenBusiness vs. LegalZoom: The Verdict
If you want an established company that offers a wide array of services, including access to professional legal advice, LegalZoom is the right choice. The company provides incredible customer support and has a proven track record. Unfortunately, LegalZoom is expensive.
ZenBusiness offers incredible value at a lower cost than LegalZoom. Added benefits like registered agent services and a free operating agreement can be huge for entrepreneurs. Plus, their packages are straightforward, and their experts excel at helping LLCs form. That said, their experts aren't lawyers and can't offer actual legal advice.
Choose ZenBusiness If:
- You want an affordable option
- You want incredible value
- You want to start an LLC
- You don't need legal advice; expert help is enough
Choose LegalZoom If:
- You want an established, reputable company
- You want access to legal advice
- You want top-notch customer support
- You want to form a more complicated business structure, like a corporation or nonprofit
We'll examine the key similarities and differences throughout the rest of this article. You can also read our entire ZenBusiness review and LegalZoom review for more information.
Services Offered & Pricing
Key Similarities
- Access to exceptional customer support teams
- Access to professional guidance and knowledge
- Both offer relatively fast filing with expedited options
Key Differences
- ZenBusiness is less expensive for basic LLC formation
- ZenBusiness includes Registered Agent services
- ZenBusiness includes an Operating Agreement template
- LegalZoom offers extended customer support hours
- LegalZoom offers a larger array of services
ZenBusiness Packages & Pricing
Starter Package - $49/year
The ZenBusiness Starter Package includes incorporation services and registered agent (RA) services. Acting as your RA, Zenbusiness will handle crucial document deliveries.
This package also provides a free operating agreement, filing of articles, LLC formation paperwork, and a CPA assessment.
Pro Package - $199/year
The Pro Package includes everything in the starter package plus help with acquiring an Employee Identification Number (EIN). Your EIN is necessary to pay your company's taxes, open a business bank account, and hire employees.
The ProPackage also includes document insurance through ZenBusiness' "Worry-Free Guarantee." Plus, they promise fast filing speeds; formation documents are always complete within one week.
Premium Package - $299/year
On top of everything in the Starter and Pro packages, the Premium Package includes rushed filing, a business email address, domain registration, domain name privacy, and everything else you need to start a business website.
LegalZoom Packages & Pricing
Economy Package - $79
LegalZoom's economy package provides state business registration and access to professional guidance. It does not cover filing fees.
With this package, you'll be able to create an Articles of Organization and a financial account authorization letter. LegalZoom will assess your documents and help you determine the next steps. You'll also have access to their customer support team via email or phone.
Standard Package - $329
The standard package includes everything in the economy package plus VIP processing, which takes an estimated 15 business days, rather than the normal 30 business days.
You'll also receive an organizer embossed with your company's name, official company membership certificates, and an official company seal.
Express Gold Package - $349
The Express Gold package includes everything from the Standard and Economy packages, with even faster processing, an estimated ten business days.
You'll also receive express shipping, so everything you order from LegalZoom arrives that much faster. That means you'll be able to open your business sooner which could put more profit in your pocket.
Other Services - A La Carte
LegalZoom offers several other services at extra costs. An operating agreement from them, for example, costs an additional $90. The price shoots up to $159 if you'd like to include Employee Identification Number (EIN) registration.
Some of these extras start as free trials included with your package purchase, but they'll charge a recurring fee when the trial ends.
Document Management & Online Experience
Key Similarities
- Easy to find documents
- User-friendly, aesthetically pleasing websites
- Fast order process
Key Differences
- LegalZoom uses constant upselling
- ZenBusiness features a personal business dashboard
- LegalZoom makes it harder to access documents
Both LegalZoom and ZenBusiness feature websites with clean designs that are easy to navigate. The order process is fast and locating your documents isn't hard. However, LegalZoom offers upsells at every turn. It feels aggressive and can slow you down. You're constantly accepting or rejecting sales pitches which is tiresome.
They also make it slightly more difficult to access and edit your documents than ZenBusiness. ZenBusiness gives you a personal business dashboard so you can reach your documents with a single click.
Processing Time
Key Similarities
- Relatively fast processing
- Expedited processing available
Key Differences
- ZenBusiness offers 2-3 week processing with starter package; 3-5 days with the top-tier option
- LegalZoom takes 30 days with their starter package; 10 days with their top-tier option
Both LegalZoom and ZenBusiness offer speedy processing times, but Zenbusiness is faster overall. With the Starter Package from ZenBusiness, you can expect your documents within 2-3 weeks. With LegalZoom, it takes thirty days.
Both companies allow you to expedite the process by upgrading your package. Even with upper-level packages, though, ZenBusiness is faster. With LegalZoom's top-tier package, you can expedite processing to ten days. Zenbusiness will do it in 3-5 days!
Compliance & Track Record
Key Similarities
- All documents are compliant
- Generally good customer reviews
Key Differences
- ZenBusiness offers CPA assessment and a "Worry-Free Compliance Guarantee"
- LegalZoom is more established
LegalZoom is the more established company and generally retains a good track record. Still, it gets mixed feedback from customers; some love it, and others run into problems. It's vital to remember LegalZoom isn't the same as hiring a lawyer. They offer professional guidance, and the documents they sell are legally compliant, but you retain all liability.
ZenBusiness is less established, but they have a lot of glowing reviews. With their "Worry-Free Compliance Guarantee" and included CPA assessment, you don't have to worry about missing crucial filing deadlines. That means you're less likely to run into compliance issues.
That said, ZenBusiness doesn't have a team of attorneys to help you the way LegalZoom does. They have "formation experts" who are experienced in business incorporation but don't give legal advice.
Customer Service
Key Similarities
- Friendly and accurate customer service teams
- Available by email or phone
Key Differences
- LegalZoom has evening and weekend customer service hours, ZenBusiness does not
- ZenBusiness offers live chat
Both LegalZoom and ZenBusiness offer fast and accurate responses from their customer service teams. You can reach both companies by email or phone, but Zenbusiness also has a live chat helpline.
LegalZoom offers slightly longer customer service hours, though. Their extended evening and weekend hours can be a real help to entrepreneurs who often work beyond the standard nine-to-five.
That said, calling LegalZoom's helpline can take a while. They have long wait times if you want to speak to a human being. ZenBusiness' live chat is much more efficient. You end up with answers far faster and avoid the frustration of being on hold.
Structure Breakdown
Whether you want to structure your business as an LLC, corporation, partnership, or nonprofit, either LegalZoom or ZenBusiness can help. However, they excel in slightly different areas.
If your business is a straightforward LLC, ZenBusiness is the clear winner. For more complicated structures, like S-corps or nonprofits, LegalZoom may be the better option.
LLCs are ideal for entrepreneurs who want to shield themselves from liabilities associated with their business. LLC formation is relatively straightforward, and either LegalZoom or ZenBusiness can help you file the paperwork.
ZenBusiness offers a few advantages, though. When starting an LLC, you need to name a registered agent. That's someone who will receive state correspondence and legal notices on behalf of your business. You can name yourself, or you can use ZenBusiness.
They include registered agent services for the first year with all their packages. They also include a CPA assessment to ensure you're meeting tax requirements. With LegalZoom, registered agent services cost $299 per year, and they do not offer a CPA assessment.
There are two types of corporations these companies can help you with, C-Corps and S-Corps. C-Corps are legal entities that remain entirely separate from their shareholders. Shareholders pay taxes on dividends, which creates a double taxation problem.
To avoid the issues of double taxation, many choose to form an S-Corp instead. With an S-corp federal taxes pass through the owner's income, avoiding corporate tax rates.
Setting up either a C-corp or S-corp requires a fair amount of paperwork, and legal knowledge is a must. ZenBusiness is affordable and can provide all the documents, but they don't have a team of attorneys available to answer legal questions the way LegalZoom does.
In a partnership, two or more people own the company. Profits pass through to the owners, so taxes are only on the owners' individual returns.
You don't have to file paperwork to start a general partnership, but it helps to have a written agreement that specifies rights, responsibilities, and profit shares. You'll also need any required business licenses, permits, and a federal tax ID. Both ZenBusiness and LegalZoom can help with those things, but you may benefit from LegalZoom's legal advice services.
Nonprofits are tax-exempt entities that benefit the public in some way. They have the benefits of limited liability for directors and founders. However, they come with a hefty amount of paperwork.
The state doesn't give away tax-exempt status easily, and nonprofits come under constant scrutiny regarding their finances. ZenBusiness can provide all the documents, and they'll act as your registered agent for the first year with no extra fees. However, starting a nonprofit is complex, and it helps to have access to an attorney like you can find with LegalZoom.
The Last Word
For affordable and straightforward business services with tons of added value, ZenBusiness is ideal. They excel at helping LLCs and other less complicated business structures form.
LegalZoom is an established company with a wide array of services, including legal advice. Use them if you're starting a corporation or if you want to take care of other legal documents at the same time using one site.
Filed under: Head-to-Head
