BetterLegal: Brief Synopsis
BetterLegal is unique among formation companies because it only offers one LLC formation and one incorporation package. This package includes some amazing add-ons such as Bylaws or Operating Agreement drafting. However, there are also some unneeded services.
Overall, we were impressed by BetterLegal’s user-friendly website and simple online filing system. The prices of the services were simple to find.
BetterLegal’s prices for recurring services were reasonable, including annual compliance and registered agent service. BetterLegal also offers more filing add-ons than most small competitors.
However, we couldn’t overlook the numerous third-party upsell possibilities offered by BetterLegal in its main formation package. The package comes at a $299 cost, even though a registered agent service was not included.
BetterLegal was founded in 2017 and is located in Austin, Texas.
BetterLegal, like many of its younger peer companies, tries to highlight its efficiency. The following statement can be found on their main website:
We are a 21st-century company that makes it fast, simple, and affordable – without the need to waste time or paper.
BetterLegal, like many small-form companies, uses third parties to provide many services. Partner companies offer various services, including online accounting firms and banks.
BetterLegal offers many services that can be used to start and run a business, despite their primary focus on business formation. BetterLegal also provides the following additional services:
- Drafting Operating Agreements and Bylaws
- Search service for a business license or permit
- Compliance services include the submission of annual reports
- You can amend your business’s name and address or change the information of members.
BetterLegal Pricing & Plans
The pricing structure for formations at BetterLegal is simple. BetterLegal’s formation bundle is priced at one flat fee, unlike competitors who may offer multiple packages.
BetterLegal’s formation package applies to standard corporations (C-corps) and LLCs. We’ll be describing the included services below. BetterLegal offers additional services for business formations, with either an annual subscription or fixed fees. This review’s “Services” section discusses these services further below.
BetterLegal’s Only Business Formation Package: $299 + state fees
BetterLegal’s only package for formations and incorporations is comparable to many middle-tier packages. Although it includes more than the typical bare-bones structure, it doesn’t offer all of the features and benefits of a premium package. For example, a registered agent service is absent.
We don’t recommend this package due to the high price of BetterLegal’s formation package, the absence of registered agent service, and the inclusions of many unnecessary services.
Articles of Organization and Incorporation: These documents are officially used to establish your LLC or corporation with the state. BetterLegal guarantees same-day filing and fast return of documents after your state processes them. Here’s what you get for a $299 flat fee plus applicable state fees:
EIN Filing: The IRS uses EINs (Employer Identification Numbers) to track businesses. Most companies require EIN. It is straightforward to apply for an EIN. You can complete the entire process online through the IRS’s EIN file web page.
Operating Agreements or Bylaws: These documents set the guidelines for how your LLC or corporation will be managed. Although not required by law in most states, they are essential for all business owners.
Banking Resolution: This document states who can open a bank account for a company and what other banking activities they are allowed to do. If you plan to open a bank account for your business, this document is necessary.
Website: BetterLegal can provide you with a domain name and help you set up an “online store with inventory control services” website. Business owners may choose to upgrade to a paid plan later.
Tax Analysis: BetterLegal’s third-party partner will perform a fundamental analysis of your tax situation.
Insurance Evaluation: A review of your company’s insurance needs. Service offerings are then made through a partner of BetterLegal or CHUBB Insurance.
BetterLegal’s Formation Package is it a good value?
Although BetterLegal does have a right to highlight that larger competitors are charging more for complete formations, we don’t think BetterLegal’s package is of any particular strength.
First, many of the “add-ons” included in BetterLegal’s package can be used to purchase other services from third parties. For example, the tax analysis and insurance evaluation are examples of this.
EIN filing adds little value as it takes only a few minutes to apply for one yourself via the IRS’s website.
BetterLegal’s description of web services clarifies that the business websites included in their package are limited in terms of capabilities. It’s better to directly go to a website builder and choose a setup that suits your needs.
BetterLegal’s formation packages do not include a registered agent service. We consider this service essential, and most companies provide at least one full year free of charge with a formation package.
BetterLegal has a solid turnaround time. It is a plus that their formation packages include Articles of Incorporation and Organization drafting. These benefits are not enough to justify the high price of this package compared with other LLC services.
On the BetterLegal website, the terms of service explain how to cancel your registered agent service,
Cancellation of Automatic Renewal . Cancellation of your automatic renewal terminates your RA Service. To cancel the automatic renewal of your RA Service, you must notify BetterLegal of your intent to cancel by calling our Customer Service Line at (512) 969-2339, emailing us at firstname.lastname@example.org, or by cancelling online through your account portal. BetterLegal agrees that when it receives notice of this cancellation, no further charges will be billed to your credit card automatically, subject to Your Obligations on Termination or Cancellation
Although not explicitly mentioned, we assume that this policy applies to all recurring-fee services such as BetterLegal’s annual compliance service.
It is pretty disappointing to see that there are no refunds or partial refunds for BetterLegal filing errors. BetterLegal’s terms for fixed-fee services are unambiguous:
All sales through the Website will be final and will not refunded.
It is rare for formation companies to have a “no refund” policy. We are therefore disappointed to see this.
Below are some of the essential services that BetterLegal offers related to formation. We will discuss when and why each service might be needed, as well as the prices shown by BetterLegal.
LLC Formation and Incorporation
$299 + state fees
BetterLegal will help you complete and file all the necessary documents to form your LLC or incorporate your corporation.
Limited Liability Companies (also known as LLCs) are one of America’s most popular business models. LLCs are easier to manage than C-corps. They also require less recordkeeping and compliance. Pass-through taxation can provide significant tax benefits.
Although corporations have more stringent requirements, they can provide tax or structural advantages depending on the size of your company and industry.
LLCs and corporations can be formed at the state level. Usually, this is done with the Secretary of State Office in a state.
Each state has its regulations and rules regarding LLC formation. It can take a lot of time to learn about these laws and processes.
Many business owners hire BetterLegal to help them fill out and file their paperwork. It is the filing of Articles of Organization for corporations. Articles of Organization are required for LLCs.
BetterLegal will file all documentation as part of the standard formation package and forward it to the appropriate state authorities. It is easy to complete the process online. The only questions you will be asked about your business are its name, owner(s), member(s), industry, and address.
BetterLegal will also perform a quick name search to ensure that your LLC or corporation name isn’t already taken (which could lead to a rejection of your application).
We noted at the top that BetterLegal’s $299 registration price does not include state filing fees. These fees can vary from $40 to $500, depending on where you file.
Includes in the formation package
A type of tax ID that all new businesses need is an EIN (or Employer Identification Number). EINs, which the IRS assigns to companies with employees, are required for opening a bank account.
Your EIN can be thought of as your business’s Social Security number. Each one is unique and used by the IRS for tracking business activities.
It is straightforward to obtain an EIN. Enter a few details about your business, and an EIN will be assigned to you automatically. It takes just minutes to apply online for an EIN using the IRS’s EIN Application Page.
We recommend avoiding any paid EIN filing services because it is easy and quick to file for one. BetterLegal includes EIN filing as part of its only package. Unlike most companies that offer the option to file your EIN for an additional fee or as part of a more costly formation package.
We are not happy that BetterLegal “includes” EIN filing costs and does not offer a discount for you dropping this service. EIN filing can be removed from your basket at checkout. However, it will not reduce your price.
Operating Agreement or Bylaws
(Included in the formation package)
Operating agreements are one of the most crucial legal documents for LLCs. Operating agreements outline the basic structure of an LLC. These agreements usually contain information such as:
- How ownership is divided between members and owners of an LLC.
- How and by whom will the LLC be managed
- How profits will be distributed
- What should you do if a member or owner dies or leaves?
- …plus key bits of information
Registered Agent Service
$90 per Year or $10 Per Month
A registered agent is required for all corporations and LLCs. Although it sounds fancy, the registered agent’s role is quite simple. They receive correspondence and serve process (legal notices such as lawsuits) for a business.
Registered agents must be accessible during business hours and located in the same state as your LLC or corporation.
It is important to receive official correspondence and respond promptly appropriately.
We cannot recommend BetterLegal’s flagship service, the formation, and incorporation package, due to its high price and lack of registered agents service.
Northwest Registered Agent is a competitor offering the same services at a cheaper price and with no third-party involvement.
However, some of BetterLegal’s one-off services are less expensive. BetterLegal offers a great deal if you are comfortable using a third party for your registered agent service. You can also get a license search and annual compliance, as well as many add-on filings.
We are not comfortable recommending BetterLegal; though they have solid reviews and an easy-to-use site, better options are available, such as Northwest RA, Incfile, and ZenBusiness.
Jeff Beckley is a business expert, journalist, book author, and founder of the website Best Inc Services. Jeff can be reached at, email@example.com