How to Become an LLC


Jackie Schultes, Henry’s Drive In asks:

My business wants to become LLC. There are a lot of places online to do this but which ones are the most trustworthy?


There are three basic choices if you want to turn your business into an LLC:

– Contact your company attorney who will gladly handle it for you.  Your accountant or CPA may even be able to recommend a local attorney if you don’t have one. This tends to be the most expensive option, but an attorney can guide you in navigating legal issues and answering legal questions.  You won’t get legal advice — you only get paperwork services — unless you deal with an attorney representing you.

– Do it yourself, by going directly to the Secretary of State in the state where your business is headquartered.  You will find forms and filing instructions online. The SBA has a convenient list of links to individual state websites.  This is the least expensive option, but it takes time and you need to feel comfortable understanding legaleze. Remember, with this option, you’re completely on your own.

– Use an online third-party filing service, as you asked about.  This is a middle ground as far as expense and time. The big names in this space — LegalZoom, BizFilings, MyCorporation — certainly have years of experience and are reputable. But here are some ways to dig deeper as you make a decision:

1) Do direct comparison shopping.  Look beyond price.  Compare several vendors by going to their websites, pick the LLC service you need, and read what each vendor includes or does not include, and how they say they will handle it.  The first step in not getting disappointed is being aware of what you will get when you purchase a filing service — and what will cost extra.   Example: state filing fees, rush mailing fees, and so on all may cost extra, in addition to preparing the paperwork.  Some vendors give you an inclusive package quote;  some just identify the basic paperwork-preparation service and you have to dig deeper to find how much filing fees will be in your state.

2) Consider how much personal service, such as the ability to speak on the phone with a knowledgeable person, you expect.  Smaller players such as may be less well known, but specialize in giving personalized service.   The larger players may have a toll-free number, but may not be set up to give personalized answers.  Read what they say about personal service on their websites.  A lot of disappointment results from customers who want to be able to speak with a knowledgeable human being, but may not get it from some vendors.

3) Search online to find reviews at review sites, to see what others have said.  The easiest way to do that is to search at a search engine like Google or Bing, for the vendor’s name along with a word such as review.  Or search specifically for the vendor’s name along with the name of one of the large review sites or a trust service such as the Better Business Bureau.  For example, go to Google and search for: LegalZoom Yelp.  Or search for LegalZoom Yelp.  Although Yelp is mainly a consumer-driven review site, recently I’ve seen a lot more reviews of small-business services on it.  Or search for BizFilings BBB — that will pull up their Better Bureau Listing.  TrustLink is another review service to search for, along with the vendor’s name.

One caution, though, about reviews you find online.  Some reviews can be written by a vendor’s competitors.  Others may reveal that the person writing the review had unrealistic expectations to begin with.  Use your judgment when reading online reviews.

Category: Ask an Expert