BetterLegal Review 2023: 7 Pros & Cons You Should Know

In this review, we will cut to the chase and go over what you really need to know about BetterLegal, including:

• The true pricing of BetterLegal’s LLC formation services
• Expected formation turnaround time
• BetterLegal’s reliability, customer reviews, support offerings, and much more

Plus, we’ll provide clear explanations of the many other relevant, formation-related services that BetterLegal offers.

Below is a quick summary of our findings. Further down, you’ll find our more comprehensive review, which details our conclusions and also explains everything you need to know about BetterLegal.

Is BetterLegal the Right Choice for You?

• Pricing:
• Turnaround Time:
• Help & Support:
• Customer Satisfaction:
• Ease of Use:

Overall Score:

3.4/5

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BetterLegal Pros

Great Turnaround Time

Excellent Customer Reviews

Inexpensive Registered Agent service

BetterLegal Cons

High price for full formation

Lack of flexibility

Limited customer support

Upselling on partner services

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Scoring Weights: Pricing (2x), Turnaround Time (2x) and Customer Satisfaction (1.5x) have been given additional weights in our scoring.

BetterLegal is unusual among formation companies in that it offers only a single LLC formation and a single incorporation package. While this package has some great add-ons, such as Operating Agreement or Bylaws drafting, it also has some unnecessary services as well.

In general, we were impressed with BetterLegal’s intuitive website and easy online filing system. Prices of services offered were easy to find, for the most part.

BetterLegal’s prices on recurring services, including registered agent service and annual compliance, were solid. They also offered more filing add-ons than most other small competitors.

We could not overlook, though, the several third-party upsell opportunities offered in BetterLegal’s main formation package. We could not overlook the $299 price tag for that package either, especially considering a registered agent service is not included.

In general, we found that, while BetterLegal bests some of its competitors, it is still not among the best value options for business formations.

You can visit BetterLegal.com yourself, or, to learn more about the factors we used to rate BetterLegal’s’ service, read on!

BetterLegal Quick Overview

Founded in 2017 and based in Austin, Texas, BetterLegal is a relatively small player within the business formation industry.

Like many of its young peer companies, BetterLegal tries to emphasize its efficiency. On their main webpage, you’ll find the statement:

We’re a 21st century company that makes the process fast, easy and inexpensive – without the unnecessary waste of time or paper.

The company does indeed boast impressive turnaround times and a very easy-to-use website.

As is the case with many other small formation companies, though, BetterLegal uses third parties to provide many of its services, such as its registered agent service. They also offer several services through partner companies, including banks, online accounting firms, and at least one insurance company.

Though they focus primarily on business formation services, BetterLegal provides many other services related to starting and running a business. Among the additional services BetterLegal offers are:

• Operating Agreement and Bylaws drafting
• A business license and permit search service
• Compliance services, including the filing of annual reports
• Amendment filings, such as those needed to change your business’s name, address, state of operation, or member info

BetterLegal Pricing

BetterLegal’s formation pricing structure is very straightforward. Unlike their competitors, who tend to have several formation package tiers, BetterLegal offers its formation bundle for one flat fee.

BetterLegal’s formation bundle applies to both LLCs and standard corporations (C-corps). Below, we’ll describe the services included. BetterLegal also offers many additional services, either with annual subscriptions or fixed fees, related to business formations. We discuss those further down, in the “Services” portion of this review.

BetterLegal’s Formation and Incorporation Package: $299 + state fees

BetterLegal’s sole package for incorporations and formations is comparable to many of its competitors’ middle-tier packages. It includes more than a typical bare-bones formation but still doesn’t have all the bells and whistles of a “premier” package – a registered agent service, for instance, is notably absent.

Given BetterLegal’s fairly high price point for its formation package, the lack of included registered agent service, and the inclusion of several unnecessary services, we don’t recommend this package.

For a fixed $299 fee, plus relevant state fees, here’s what’s included:

Articles of Organization or Incorporation: The documents officially establishing your LLC or corporation with your state. BetterLegal promises same-day filing and a speedy return of documents once your state has processed them.

EIN Filing: EINs (Employer Identification Numbers) are used by the IRS to keep track of businesses. Most businesses require an EIN. Luckily, filing for one is easy. The whole process can be done online, in minutes through the IRS’s EIN filing web page.

Operating Agreement or Bylaws: These documents establish the guidelines concerning how your LLC or corporation is to be run. Though not legally required in most states, we consider them essential to all new business owners.

Banking Resolution: A document stating who is allowed to open a business account and perform other banking activities on behalf of a business. This document is required if you intend to open a bank account for your business.

Website: BetterLegal will provide you with a domain and set up a basic website or “online store with inventory management services.” Business owners can decide to upgrade to a paid website plan at a later time.

Tax Analysis: A basic analysis of your business’ tax situation performed by a third-party partner of BetterLegal.

Insurance Evaluation: An evaluation of your business’s potential insurance needs, with service offerings then provided through a third-party partner of BetterLegal, CHUBB Insurance.

We’ll go into greater detail on this package’s overall value just a bit further down in the article.

BetterLegal vs Competitors Pricing

Below, you’ll find our table that compares formation prices of BetterLegal’s main competitors.

Is BetterLegal’s formation package a good value for the money?

While BetterLegal is right to point out that some of its larger competitors charge more than it does for a full formation, we don’t believe BetterLegal’s own package is a particularly strong value either.

Firstly, several of the “add-ons” included with BetterLegal’s package are really just opportunities to buy other services through third parties. This is true of the insurance evaluation and tax analysis, for instance.

EIN filing also adds almost no value, as it only takes a few minutes to file for an EIN yourself through the IRS’s website.

As for web services, it’s clear from BetterLegal’s own description that the business websites they offer as part of their package have limited capabilities. Better to go directly to a website builder service and pick a setup that’s just right for your business’ needs.

On top of all this, there’s no registered agent service included with BetterLegal’s formation package. We consider this to be an essential service, and it’s one that most companies offer at least a free full year of with the purchase of a formation package.

BetterLegal’s turnaround times are solid. The fact that they include Articles of Incorporation or Organization drafting in their formation package is a definite plus. But these upsides just aren’t enough to justify the package’s high price tag when compared to other LLC services.

Cancellation policy

To find information on BetterLegal’s cancellation and refund policies, you have to dig through a lot of the legalese on their Terms of Use Page.

Here’s what BetterLegal says with regards to canceling their registered agent 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 email@betterlegal.com, or by canceling online through your account portal.

Though not explicitly mentioned, we assume this policy applies to other recurring-fee services, such as BetterLegal’s annual compliance service.

There is one other important thing to note about canceling your registered agent service with BetterLegal. The terms of service also state:

You are responsible for all expenses incurred by your use of the RA Services after termination or cancellation including, but not limited to, shipping charges incurred to forward Legal Mail received on your behalf.

So, if you don’t want to be charged extra fees for forwarded mail sent after you cancel your service, make sure to contact the third-party registered agent service directly. This is another reason that we dislike having to go through third parties for registered agent service.

As for other fixed-fee services, BetterLegal’s terms are quite concise: “All purchases through the Website are final and will not be refunded.”

A true “no refund” policy is pretty unusual among formation companies, so we’re disappointed to see it here. That there are no provisions for partial refunds, or even refunds in the event that BetterLegal makes a filing error, is a pretty strong con.

BetterLegal Pros

Below are a few of the areas where we thought BetterLegal was particularly strong.

Solid turnaround times

BetterLegal highlights its turnaround times on its main webpage. They claim same-day filings for all their formations, meaning your Articles of Organization or Incorporation will be sent to state authorities on the same day you submit them through BetterLegal.

They also say that you’ll receive your documents within two business days. We assume this isn’t accounting for actual states’ processing times, which can be a couple of weeks – still, it seems like BetterLegal does everything on their end to move things along as quickly as possible.

Many reviews back up BetterLegal’s claims. Quite a few of the reviews we looked at, like the one below, mentioned the company having a quick turnaround time on formations.

BetterLegal’s same-day filing applies to all their orders. You don’t need to pay extra to get internal prioritization, which is something that many of BetterLegal’s competitors do charge for.

As a fast turnaround time is usually one of the two most important factors for those forming new businesses (the other being formation price), this is a big plus for BetterLegal.

Great reviews

BetterLegal is a small company, and we don’t have as many reviews to go off of as we’d prefer. Still, what’s available is quite solid.

BetterLegal sports a 4.8 out of 5 on Trustpilot

They also have a 4.88 out of 5 with the BBB.

They’re Better Business Bureau accredited as well, boasting an A+ rating.

Reviewers of BetterLegal seem to have good things to say across the board. They appreciate the company’s clarity, turnaround time, and prices (even though we ourselves don’t think their prices are particularly impressive).

BetterLegal also has several hundred positive testimonials on the “Reviews” section of their website.

Of course, testimonials can be cherry-picked, so these should be taken with a grain of salt. Still, the quantity is impressive, especially for a small company.

Inexpensive Registered Agent service

BetterLegal offers a third-party Registered Agent service for just $90 per year or $10 per month. Most registered agent services we review cost over $100 per year, as is the case with RocketLawyer and Swyft Filings. We’ve even seen prices as high as $299 per year with big-name companies, including LegalZoom.

Even a small amount of savings with a Registered Agent service can add up, since you pay a fee annually. This is especially true if you end up operating in multiple states, as you’ll need registered agents in each of them.

BetterLegal uses third parties for its registered agent service, and you have to do more digging than we’d prefer to get to any details. However, we do like that, according to BetterLegal’s terms of service use page, their registered agent providers will scan received documents and quickly upload them to your online account.

BetterLegal Cons

BetterLegal also has plenty of areas that could use improvement. We go over some of them below.

High price for full formation

BetterLegal’s formation package, at $299, is about in line with its competitors’ mid-to-high-tier packages. Unfortunately, although this package includes key services like Articles of Organization filing and Operating Agreement drafting, it does not include Registered Agent service.

We consider a registered agent service to be vital. Tacking that on adds another $90, bringing the total price of a full formation up to $387.

BetterLegal is absolutely right that some of its competitors are even more expensive. The cost of a full formation with LegalZoom is a whopping $477.

But just because BetterLegal isn’t the most expensive option doesn’t mean it’s the cheapest either. Northwest Registered Agent offers a full formation plus registered agent service for just $225 in total, while ZenBusiness’s price is only $199 for the same.

At that $229 price point, you’re also paying for services that you don’t necessarily need, like EIN filing, a tax analysis, and an insurance evaluation.

Limited customer support

Smaller formation companies tend to be nimbler, more efficient, and less expensive than their larger competitors. However, many small formation companies also lack the support staff that the bigger players have.

BetterLegal is no exception here.

While the BetterLegal website offers an online chat feature, there is no contact information to be found on their main pages. To find those pieces of info, you have to dive all the way to the bottom of the company’s privacy page. And, even there, there’s no info on when phone lines are available or how fast emails are responded to.

BetterLegal, it seems – like many of their peers – relies heavily on automation for their customer service.

Ideally, your formation will go through without a hitch and you’ll never need to contact a service rep. We still see a lack of service rep availability as a definite downside, though.

Lack of flexibility

While most of its peer companies offer several different tiers of formation packages, BetterLegal offers only a single package. If you’re looking for a true bare-bones filing, you can’t really get one with BetterLegal.

The only core formation service that you can opt to tack-on to your formation is BetterLegal’s Registered Agent Service. And while this service is pretty cheap, at $90 per year, we don’t like that it’s not included with the company’s already expensive formation package.

You can also opt-out of EIN filing, but that won’t reduce your formation cost at all.

We always prefer more options over fewer. You should be able to choose the services that you need without having to pay for the ones that you don’t.

Here, BetterLegal falls short.

Upselling on partner services

On the package comparison section of their website’s main page, BetterLegal proudly proclaims that it offers: “ONLY WHAT YOU NEED, NOTHING YOU DON’T: No upsells or advertisements for products you don’t need.”

Unfortunately, a look at BetterLegal’s formation package offerings shows this is not exactly the case.

BetterLegal’s website, business checking, tax analysis, insurance evaluation, payroll, benefits, and HR platform services are all provided by third parties. And while they are included for “free” in the package, each comes with potential upsell opportunities.

Right in the “website” service description, for instance, BetterLegal states that “As your business grows, [you can] transition to a paid plan to unlock more features and customization.” There’s no info on what features are offered without the paid plan.

Similarly, tax analyses and insurance evaluations, while they may be somewhat informative, are essentially sales pitches.

Now, BetterLegal doesn’t force you to buy any of these third-party services. However, we still don’t love that nearly half the services included in their formation package are third-party related, especially since the company itself claims to avoid upselling.

BetterLegal Services

Below, we’ll discuss some of the main formation-related services that BetterLegal offers. We’ll go over when and why you might need each service, and we’ll include BetterLegal’s prices too.

LLC Formation and Incorporation

$299 + state fees

BetterLegal can help you fill out and file the key documents for forming your LLC or incorporating your corporation.

LLCs, or Limited Liability Companies, are one of the most popular business types in the United States. Nimbler and easier to manage than standard corporations (C-corps), LLCs have fewer recordkeeping and compliance requirements. They can also confer some serious tax benefits through pass-through taxation.

Corporations have more cumbersome requirements, but they can also confer some structural or tax advantages, depending on your business’s size and industry.

If you’re not sure whether an LLC or a corporation is the right business type for you, consult with a small business expert or a certified accountant.

Both LLCs and corporations are formed at the state level, usually with a given state’s Secretary of State Office.

Each state has its own rules and regulations regarding the formation of LLCs, and learning about all the processes and laws relevant to you can be a significant time sink.

Many new business owners hire a formation service, like BetterLegal, to fill out and file their paperwork for them. For LLCs, that means filing Articles of Organization. For corporations, it means filing Articles of Incorporation.

As part of their standard formation package, BetterLegal will file your documentation and send it to the relevant state authorities. The process is simple and can be completed entirely online. You’ll just be asked some straightforward questions about your business, e.g., its name, its owner(s) or member(s), its industry, and its address.

BetterLegal will also run a quick name check to make sure your LLC or corporation’s name isn’t already taken (which can result in a rejected application).

As we noted at the top of this description, BetterLegal’s $299 formation price does not include state filing fees, which may range anywhere from $40 – $500, depending on your state of filing.

EIN Filing

Included with formation package

An EIN, or Employer Identification Number, is a type of tax id that most new businesses will need to acquire. Assigned by the IRS, EINs are legally required for businesses with employees and are also necessary if you want to start a business bank account.

You can think of your EIN as sort of being like your business’s Social Security Number. Every one is unique, and they’re used by the IRS to keep track of business’s activities.

Thankfully, acquiring an EIN is a very easy process. You can do it online, using the IRS’s EIN application page, in just minutes. You simply type in a few pieces of info on your business, and you’ll be assigned an EIN automatically.

Because filing for an EIN is so quick and painless, we always recommend against any paid EIN filing service. Unfortunately, whereas most companies give you the option to file for your EIN for an extra fee (or as part of a more expensive formation package), BetterLegal automatically includes EIN filing in its one and only formation package.

You can remove EIN filing from your basket at checkout, but it won’t reduce your price at all. We’re not thrilled that BetterLegal “builds in” the price of EIN filing and doesn’t give you a discount for dropping this unnecessary service.

Operating Agreement or Bylaws

Included with formation package

An Operating Agreement is one of the most important legal documents for any LLC. Operating Agreements lay out the basics of how an LLC is to be run. They usually include info such as:

• Who an LLC’s owner(s) or member(s) are, and how ownership is divided among them
• How and by whom the LLC will be managed
• How profits are to be distributed
• What to do if an owner or member leaves or passes away
•  …plus other key pieces of info

Only a few states – California, Delaware, Maine, Missouri, and New York – legally require you to have an Operating Agreement. And, even with these, you don’t need to file your agreement with the state, you are just required to keep it on hand.

Even so, we recommend that all LLCs, in all states, draft an Operating Agreement and keep it on hand.

An Operating Agreement establishes your LLCs liability protections. As liability protections are one of LLC’s key benefits, it’s unwise to forgo them.

Operating Agreements also help in providing guidance during unexpected events. You probably don’t go into business expecting a partner to quit or a dispute over profits to arise – but having a pre-written document on hand can help you get through such situations more smoothly.

If you’re incorporating instead of forming an LLC, you’ll need Corporate Bylaws instead of an operating agreement. Corporate Bylaws work much in the same way as, and provide similar benefits to, operating agreements.

As part of their main formation package, BetterLegal will help you draft a legal Operating Agreement or Corporate Bylaws.

Banking Resolution

Included with formation package

A banking resolution is another simple yet important document. A banking resolution outlines which member(s) of an LLC have the authority to open a business bank account and participate in other banking-related activities.

Banks require you to submit a banking resolution when you open a business bank account.

As part of their formation package, BetterLegal will draft a banking resolution for your business. All you’ll have to do is provide them with information on who is allowed to start and / or access a bank account in your LLC’s name.

Website services

Included with formation package

BetterLegal is one of only a handful of formation companies that offers a web domain along with its formation package. Unfortunately, details on their offer are sparse.

Their main package page states that you’ll be able to: “Set up a free website or online store with inventory management.”

However, there’s evidence of upselling here too, as the following sentence reads: “As your business grows, transition to a paid plan to unlock more features and customization.”

BetterLegal has a GoDaddy ribbon on their main webpage, but nowhere does the company directly state who its third-party domain hosting partner is. There isn’t even a name given when you dig through the company’s terms of service.

We’re all for transparency, so we’re disappointed with BetterLegal here. In any event, we always recommend going directly to a domain host or business website builder anyway.

Plenty of companies are specialists in those categories, so there’s no need to get these services second-hand through a formation business.

Registered Agent Service

$90 per year or $10 per month

All LLCs and corporations are legally required to have a registered agent. Though it may sound like a fancy term, the role of a registered agent is very simple – they receive official correspondence and service of process (legal notices, such as lawsuits) on behalf of a business.

Registered agents must be available during business hours, and they must be based in the same state your LLC or corporation is based.

Properly receiving official correspondence, and being able to respond in a timely manner, is essential.

If you miss a compliance notice from the state or federal government, your business could lose its good standing, receive penalties or fees, or even be dissolved. And if you don’t respond to a court summons and miss your court date, your case can be automatically forfeited.

Having an on-the-ball registered agent, then, is truly important.

Technically, you can be your business’s own registered agent. There are, however, several reasons that many business owners opt to use a registered agent service.

We’d suggest using Registered Agent service if:

• You travel frequently and are not always at a single address
• You are not a resident of the United States
• Your business operates in multiple states
• You don’t want your name and address to be publicly available

Like most other formation companies, BetterLegal offers a registered agent service. And, like most other small formation companies, BetterLegal contracts this service out to a third-party.

We don’t love having to go through third-party registered agent services, as these can create some additional privacy concerns and complicate things in the event you need to cancel your service.

Unfortunately, BetterLegal doesn’t do a good job with transparency here. They don’t state which third-party they use – instead, they state that they use multiple without actually naming any of them.

You acknowledge and agree that BetterLegal does or may work with third-party providers and sub-providers (each, a BetterLegal Registered Agent or “Registered Agent”) of our choice to provide some or all of the Registered Agent Services.

BetterLegal’s full terms of service can be found here.

If you are able to overlook the transparency issue, BetterLegal’s registered agent service actually comes at a great price. You can pay either $10 per month or $90 per year. That later price is very competitive – plenty of other big names in the business charge $150 per year or more.

BetterLegal’s registered agent service is also an add-on – it does not come with their standard formation package. This makes them somewhat of an outlier, as many competitors include registered agent services with their formation packages, often including the first year of service for free.

Business License Search

$125

Depending on what type of business you run, what industry you’re in, and where you’re based, you may need a few or many permits and licenses. These may be needed at the local, state, or federal level.

Licenses can be a pain to deal with, but they’re absolutely necessary. If you’re out of compliance, you may be given a hefty fine or have your business temporarily shuttered or even completely dissolved.

Figuring out which permits and licenses apply to your specific business requires quite a bit of research. Instead of sifting through lots of red tape and legalese yourself, you can hire a company like BetterLegal to perform a business license search.

Lots of formation companies offer this service. You’ll enter info on your business, and BetterLegal will do a comprehensive search, compiling all the licenses and permits that are relevant to you and providing instructions on how to fill them out.

Note that BetterLegal does not file these for you – it gives you the tools and info you need to file them yourself. Still, this can be a huge time-saver, especially for highly-regulated businesses.

Annual Compliance

$90 per year or $10 per month

Most state governments require LLCs and corporations to submit some form of annual report. Usually, these reports aren’t too cumbersome or in-depth. They’re just meant to be a way for states to keep tabs on the businesses operating within their jurisdiction.

Your deadline filing report may be fixed (e.g., all businesses have to submit a report in December) or based on your business’s formation date (e.g., if you formed in August of 2023, you’ll submit your first annual report in August of 2023). Some states only require you to file a report every two years.

Filing your annual report may seem like an unnecessary hassle, but it absolutely should not be overlooked. If you fail to file your report on time, you may receive a fee or lose your good standing with the state.

Many formation services, including BetterLegal, offer annual compliance services. For a monthly or yearly fee, BetterLegal will send you reminders regarding your upcoming annual report deadline. Then, once you’ve entered the relevant info, they’ll draft your annual report and send it off to the state for you.

Most states have a nominal (under $100) fee for annual report filing – BetterLegal will take that fee from you and forward it to the relevant authority.

Third-Party Offerings

Included with formation package

BetterLegal also provides a small suite of third-party offerings as part of their business formation package.

Business Checking: You’ll be set up with a no-fee, no-minimum online business bank account. You’ll receive debit cards associated with the account and you’ll also be able to send physical checks from your online account.

Tax Analysis: Advice and analysis from a “leading virtual tax service”. It’s unclear how in-depth the analysis is and what sort of questions you’ll be able to ask.

Insurance Evaluation: An evaluation of your business’ specific insurance needs. Insurance services are then offered through a BetterLegal partner, CHUBB Insurance, which is based in New Jersey.

Payroll, Benefits, and HR Platform: A more extensive offering that, unlike the others, is not free with your formation packages. A wide variety of services are covered, all provided by third-parties.

While it’s certainly possible that some business owners will get value out of these add-on services, we tend to be wary of “offers” like these. Usually, services like these are just opportunities for companies to drive business to their partners.

We recommend going directly to specialists for your tax, insurance, payroll, and HR needs.

As for bank accounts, it’s usually to your benefit to use a bank that you already have an established relationship with. If you don’t have a bank that fits that description for you, BetterLegal’s partner offer may be an attractive one.

Additional Filing Services

Prices vary

BetterLegal also offers a bunch of one-off filing services that are not included with its main formation package. Below, we’ve listed those which we think will be most relevant to new business owners, along with BetterLegal’s fixed fee for each.

Domesticate foreign LLC: Moves your LLC’s home state from one state to another, $299

Reinstate LLC or corporation: Reinstates an LLC or corporation that had previously been dissolved, $199

Terminate LLC or corporation: Legally dissolves an LLC or corporation, $199

Obtain Certificate of Good Standing: Obtains a certificate from your business’ home state showing that you are up to date on all your fees and are in compliance with state permit and license laws, $25

Register foreign LLC in a new state: Allows an LLC formed in one state to legally operate in another state. Also called a “Foreign Qualification,” this process usually involves applying for a “Certificate of Authority” – essentially, a permit to do business in a specific state, $199

Change principal office address: Changes your business address from the one originally listed on your Articles of Organization or Incorporation to a new one, $99

Remove or add members, directors, or shareholders: Officially alters your company’s record to reflect changes in its members, directors, or shareholders, $99

Do we recommend BetterLegal?

Conditionally

Given its high price point and lack of registered agent service, it’s tough for us to recommend BetterLegal’s flagship service – its formation and incorporation package.

Competitors such as Northwest Registered Agent offer the same suite of services at a lower price, and without all the third-party involvement.

Some of BetterLegal’s one-off services, however, are more reasonably priced. If you’re fine going through a third party for your registered agent service (which does have its drawbacks), BetterLegal’s has a good deal. Its license search, annual compliance, and several of its add-on filing services are also fairly priced.

Since BetterLegal does have solid reviews, an easily navigable site, and a good record on turnaround times, we’re comfortable recommending these services.

Most new business owners prefer to do their startup filing and add-on filing all in one place, though, so we recognize this recommendation won’t apply to everyone.

If you want to learn more about the competition’s offers, check out some of the many reviews available here!