Is it better to Use a Business Registration Service Like Bizee or LegalZoom, or Should You Handle It Yourself?
Starting your own business is exhilarating—full of possibilities, creativity, and dreams of success. But before you can officially launch, you’ll need to handle one of the most critical steps: registering your business. With a growing number of online services, from Bizee to LegalZoom and beyond, you may wonder whether to use a professional business registration service or if you’re better off doing it yourself.
Let’s break down both paths so you can make an informed decision based on the complexity of your filing, your budget, and how comfortable you are navigating the legal terrain of business formation.
Why the Business Registration Process Matters
Before diving into the question of using services or going the do-it-yourself (DIY) route, let’s first talk about why proper registration is crucial:
Legal Protection: Registering your business ensures you’re operating legally, which shields you from personal liability and potential legal consequences if something goes wrong.
Brand Credibility: An officially recognized entity adds professionalism. Vendors, banks, partners, and clients will take your business more seriously if it is properly registered.
Financial Considerations: From opening a separate business bank account to applying for loans and grants, registration puts you in a position to leverage opportunities that are otherwise off-limits to unregistered companies.
At its core, setting up your entity correctly sets the stage for growth and success, all while protecting your personal assets.
For Complex Filings: The Pros
Here are a few key advantages of turning to a professional service, especially when the filing is complex:
Expert Guidance
Professional Advice: If your business structure is more sophisticated—like setting up a multi-member LLC, a non-profit, or a corporation—having experts guide you on state-specific compliance can save you big headaches.
Customized Approach: Some services offer tiered plans with add-ons like registered agent services, drafting legal documents, and personalized consultations.
Time Savings
Streamlined Process: Services often break down the steps into a simple questionnaire. Once you provide your details, they handle the forms and filings, letting you focus on other aspects of building your business.
Reduced Errors: For busy entrepreneurs, it’s easy to overlook small but crucial details. Registration services reduce the risk of filing mistakes that can delay your launch.
Compliance Support
Annual Reminders: Many services send email reminders about annual reporting deadlines, upcoming filing fees, and potential compliance changes in your state.
Ongoing Assistance: If you need to amend your documents, change your address, or add additional members or managers in the future, these services can help facilitate those changes without you having to research everything from scratch.
Peace of Mind
Legitimacy: Knowing your paperwork is handled by professionals specialized in business registration can calm the nerves of any new entrepreneur.
Legal Confidence: While these platforms don’t replace the expertise of an attorney, they can deliver confidence that your forms are in line with typical state requirements.
Actionable Tip: If you have multiple founders or expect your business to raise capital, using a service or hiring a lawyer can ensure your structure is set up correctly from day one. This proactive step can help avoid costly legal or compliance reworks down the road.
Companies like Bizee and LegalZoom have grown increasingly popular because of their user-friendly process and expertise.
“I've gone through both options, and I've found that using a business registration service like Bizee or LegalZoom can save time and reduce errors, especially when dealing with complex filings or unfamiliar state requirements. These services provide reminders and automated filings, which can be helpful for staying compliant without manually tracking deadlines. However, they can be more expensive, and sometimes you still need to review and manage things yourself to ensure accuracy.
On the other hand, handling registrations and annual filings independently gives more control and can be cost-effective, but it requires staying on top of deadlines and understanding the legal requirements. I've missed a filing deadline before due to a busy schedule, which led to late fees.
Now, I use a calendar system with automated reminders to avoid that. If you're managing multiple filings across different states, a professional service might be worth it, but for a straightforward setup, doing it yourself is manageable with proper organization.”
Georgi Petrov, CMO, Entrepreneur, and Content Creator, AIG MARKETER
2. Registration Services Business Registration: The Cons
Despite their value, business registration services aren’t always the perfect fit for every situation.
“Based on my experience, I'd say steer clear of services like LegalZoom if you want a smooth and hassle-free business registration process. We had a pretty awful experience with them-after setting up a new entity and deciding to close it before trading, LegalZoom continued charging the company yearly for a non-existent entity. Every year, we complained, got a refund, and then the following year, the same issue happened all over again. Six years of this nonsense, and it's still not fully resolved.
Because of that, we now always use a professional accounting practice for handling company formations, filings, and anything related to compliance. It might cost more up front, but you're paying for expertise, reliability, and peace of mind.
There's nothing worse than thinking everything is sorted, only to find out later that an automatic charge or a missed filing deadline is causing unnecessary stress.
As for staying on top of annual filings and compliance, having a good accountant is invaluable. They handle it, remind you of key deadlines, and ensure everything is done properly and on time. If you're running a business, the last thing you need is dealing with administrative headaches caused by a cheap, automated service that doesn't really care if things go wrong.”
Jm Littman, CEO, Webheads
Here are some potential drawbacks:
Cost vs. Value
Package Pricing: Most platforms bundle various services into tiered packages. If you only need minimal assistance, you might end up paying for features you don’t really use.
Add-On Fees: Fees for state filings, registered agent services, and compliance tasks can sometimes pile up.
Limited Customization
Generic Templates: Although you can often customize certain sections, many templates used by registration services are somewhat broad. If you have niche or highly specialized legal needs, you may need an attorney’s one-on-one attention instead.
State-Specific Differences: While LegalZoom, Bizee, and others do account for state laws, there are scenarios where you may need to dig deeper into your state’s statutes or consult a local professional.
Risk of Over-Reliance
Not a Law Firm: Remember, these services don’t represent you in court or provide the same extensive legal insight a specialized business attorney might offer. If your business model or industry faces specific regulations, you may need legal counsel outside the scope of a registration service.
Cookie-Cutter Approach: A standard template might be fine for a simple LLC, but if your structure or industry is nuanced, you could miss out on important clauses or disclaimers.
Potential Delays
Volume of Filings: High-traffic periods, especially at the start of the year or near tax deadlines, can cause slowdowns. If you need a faster turnaround, you might have to pay extra for expedited service.
Tip: Before selecting a service, list exactly what you need—LLC formation, registered agent, EIN application, etc. Compare the final cost and timeline between different providers or consider an attorney’s quote. This ensures that you don’t fall into the trap of paying for extras that you could handle more affordably on your own.
3. Registering Your Business on Your Own
If you’re on a tight budget or simply enjoy taking the DIY approach, you can register your business yourself.
“Filing paperwork is the least exciting part of running a business. I tried LegalZoom to handle registrations fast, but they don't cover everything. State-specific rules still require follow-ups. Doing it yourself saves money, but deadlines creep up fast. If compliance isn't your thing, outsourcing helps. If you prefer control, DIY works—just set reminders early.
Annual filings can slip through the cracks. A simple calendar system with alerts prevents last-minute stress. Using a registered agent service keeps official notices from getting buried in emails. Personally, Google Calendar and a physical planner work best. A quick quarterly check-in avoids the year-end rush. The process isn't hard—staying consistent is.”
Natalia Lavrenenko, UGC manager/Marketing manager, Rathly
Every state has a specific set of requirements, but here’s what to consider if you decide to handle registration without third-party help:
Research Requirements Thoroughly
Know Your State’s Rules: Each state has its own forms and filing deadlines. Visit the official state website (usually the Secretary of State’s office) to verify the exact documents and fees required.
Choose Your Structure: Common structures include sole proprietorships, LLCs, and corporations. Understand the advantages and disadvantages of each so you can pick what’s best for your goals.
Prepare Your Documents
Articles of Organization or Incorporation: If forming an LLC, you’ll file Articles of Organization; for a corporation, you’ll file Articles of Incorporation.
Operating Agreements & Bylaws: While not always mandatory, creating an operating agreement (for LLCs) or bylaws (for corporations) is a best practice to outline ownership, roles, and responsibilities.
Obtain Necessary Licenses & Permits
Industry-Specific Permits: Depending on your sector—food service, childcare, construction—you may have to apply for additional licenses.
Local Registrations: Don’t forget to check city or county requirements, such as a local business license.
File Your Federal & State Taxes Properly
Employer Identification Number (EIN): If you plan to hire employees or open a business bank account, you’ll likely need an EIN, which is free through the IRS.
Sales Tax Permit: If you sell products, check if your state requires you to collect and remit sales tax.
Pros of Going DIY
Cost Savings: You only pay the required state fees, which can be significantly cheaper than service fees.
Hands-On Knowledge: Filing yourself means you fully understand the registration process and your obligations, reducing confusion down the line.
Custom Control: You can ensure every detail in your formation documents is specifically tailored to your vision, without relying on default templates.
Cons of Going DIY
Time-Consuming: Researching the correct forms, filling them out accurately, and troubleshooting any issues can be more time-consuming than you expect.
Risk of Errors: Mistakes in filings can lead to rejection, delays, or even legal complications.
Limited Support: If you get stuck, you have to figure things out yourself or pay for an attorney’s guidance.
Actionable Tip: If your business is straightforward—a single-member LLC or a simple partnership—going DIY might be a practical, cost-effective choice. Be sure to keep detailed records of all forms and confirmations in a dedicated folder for easy reference later.
Making the Final Decision: Which Path Is Right for You?
To decide whether a service like Bizee or LegalZoom is worth it or if you’re better off filing alone, consider these key questions:
Complexity of Your Business
Are you forming a multi-member LLC with a complex ownership structure, or do you plan to raise capital? If yes, services (or an attorney) can simplify the process and ensure you don’t miss crucial legal requirements.
Is your business simply you as the owner and maybe one part-time employee? A straightforward entity may be easy enough to handle solo.
Time vs. Budget
If you have more money than spare time, outsourcing might be more efficient.
If you’re bootstrapping your venture or you feel comfortable with paperwork, a DIY approach can help you save on formation costs.
Level of In-House Expertise
If you already have a legal background or can quickly learn legal basics, you might find the process more manageable on your own.
If you’re unsure about compliance in your state or you want ongoing support, using a service can alleviate stress.
Long-Term Goals
If you plan to scale rapidly or attract investors, your formation documents must be top-notch. Having professional guidance at the start can set a stable foundation.
If it’s a smaller, more local venture, you might not need all the bells and whistles offered by big-name filing services.
Action Steps & Additional Resources
Compare Service Plans: If you decide to use a service, get quotes or review pricing structures. Look for hidden or recurring fees (e.g., annual registered agent fees).
Check State Websites: Bookmark your state’s business registration portal and read their guidelines carefully. Many states provide detailed instructions that are easy to follow.
Consult Professionals if Needed: For specialized industries or unique business structures, investing in a brief consultation with a local attorney could save you from costly mistakes.
Stay Organized: Whichever route you take, keep digital and physical copies of every document. This will help you stay compliant and make annual filings simpler.
Should you hire a service like Bizee or LegalZoom, or file your business on your own? The answer hinges on your comfort level with legal paperwork, your budget, and your business’s complexity. By taking an honest look at your circumstances and the pros and cons of each approach, you can make a choice that sets your business up for success from the very start.
Regardless of which path you choose, remember that thorough research and proper documentation are non-negotiable. Stay proactive, stay informed, and you’ll be well on your way to running a legally sound business—ready to flourish in today’s competitive landscape.