Both LegalZoom and LegalShield are online legal services that aim to help entrepreneurs start a business and run it successfully and legally. While LegalZoom covers all of the United States, LegalShield has expanded their services into Canada as well, making it even more accessible.
Paying an attorney an hourly fee or a retainer can be very costly, and for small business owners, that expense can’t always be justified. But all of the legal aspects of starting and running a business often require an attorney to help you through it, so that’s where LegalZoom and LegalShield come in. They both offer access to attorneys for all of your questions and concerns without the hourly rate.
LegalZoom vs. LegalShield: Features
Both LegalShield and LegalZoom offer pretty much everything you’ll need (from a legal perspective) to form your business—and then run your business for years to come. Let’s take a closer look at the documents and services each offers.
Here are some features you can expect from LegalZoom, for both business formation and normal business operations:
- Formation services for Limited Liability Company (LLC), corporation, nonprofit, sole proprietorship
- Employer identification number (EIN)
- Tax, license, and permit services
- Business naming services
- Workplace benefits
- Bill of sale
- Independent contractor agreement
- Nondisclosure agreements
- Trademarking services
Similar to LegalZoom, LegalShield offers services for starting a business as well as continuing to run that business all while remaining compliant with local and federal laws. Here is a breakdown of LegalShield’s services:
- Unlimited phone consultation with your attorney
- Document and contract review
- Letters and calls on your behalf
- Debt collection services
- Trial defense
- Member discounts
- Business formation services
- Registered agent service
LegalZoom vs. LegalShield: Pricing
While there’s plenty of overlap in features, the pricing of LegalZoom vs. LegalShield is very different. Each service provided by LegalZoom comes with its own package options and pricing. You can also price things on an individual basis, like if you needed specific documents, but not the full services of incorporating. On the other hand, with LegalShield, plans are organized by the number of employees a business has. This could work in favor of some businesses, but it could be a downside for others.
For example, to get an EIN, prices start at $79. Certified copies of documents like DBA filings, annual reports or dissolutions, start at $45. To form an LLC with LegalZoom, this is how the pricing breaks down:
$79 + state filing fee
-Name check and business filing
-Articles of organization
-LLC Next Steps Guide
-“Peace of Mind” review
-Lifetime customer support
-Financial account authorization letter
$329 + state filing fee
Everything included in Economy, plus:
-Official certificates and seal
-LegalZoom VIP processing
$349 + state filing fee
Everything included in Economy and Standard, plus:
-Rush processing with Secretary of State
If you know the documents you need outside of a business formation package, finding the pricing will be simple—but if you’re unsure, it might take some searching around. If you’re looking for attorney advice, there are two options: the Business Advisory Plan (starting at $31.25 per month) and the Legal Advantage Plus (starting at $9.99 per month).
If you’re looking for their normal small business plans, these are the package options you have to choose from:
|10 Employees or Less||
$39 per month
-Up to two designated users
-Unlimited minutes and matters for legal consultations
-Three, 30-minute designated consultations
-20 letters and calls, up to six in any month and one follow up letter or call per matter
-20, 15-page-per-document review, up to six in any one month
-Five debt collection letters per month
-25% off hourly rates
50 Employees or Less
$89 per month
Everything included in above package, with the following changes:
-Up to three designated users
-30 letters and calls, up to six in any month and one follow up letter or call per matter
-30, 15-page-per-document review, up to six in any one month
-10 debt collection letters per month
-75 total trial defense hours per year, up to 15 hours of pre-trial work
100 Employees or Less
$149 per month
Everything included in the two above packages, with the following changes:
-Up to five designated users
-40 letters and calls, up to six in any month and one follow up letter or call per matter
-40, 15-page-per-document review, up to six in any one month
-15 debt collection letters per month
-75 total trial defense hours per year, up to 25 hours of pre-trial work
While all of the plans offer document review and feedback, if you need your attorney to actually draft a document for you, there are two options: You could download a free template, fill it in and then have your attorney review it, or your attorney could draft it from scratch, and that’s where the 25% off hourly rate comes in, as you would receive that discount on your attorney’s hourly rate to draft a document from scratch.
LegalShield also has a program to help you form your business, called Launch, and that comes with a different price. For $145 plus state filing fees, you will be connected with a local business attorney who will help you find the right business entity to form, complete all the related paperwork, and file it for you. In addition to that, they will provide legal support for three months after your business is formed.
LegalZoom vs. LegalShield: Pros and Cons
A pro and con list is a great way to really narrow down the benefits of one business versus another and how they meet your needs. You’ll see that LegalZoom and LegalShield have about the same number of pros as they do cons, but determining which are your non-negotiables will help you decide which is better for your business.
LegalZoom Pros and Cons
- No monthly membership to be locked into
- You will get a copy of any documents that have been filed on your behalf
- Individual pricing benefits small businesses that don’t need full service legal help
- Attorney plans available for those who need more advice
- No downloads or edits of any documents
- Access to attorneys isn’t free and doesn’t come with any other package options
- Customer service gets very mixed reviews
- Have to know what documents or services you need in order to find pricing
LegalShield Pros and Cons
- Access to your attorney on an unlimited basis
- Pricing based on number of employees
- Trial defense
- Everything you need to form your business
- Member perks, like discounts at stores including Target and Verizon, and hotels like the Holiday Inn
- Attorney satisfaction will vary depending on the law firm you are assigned
- Canceling membership can be tricky
- Only 39 associated law firms throughout the U.S. and Canada, so finding one in your state might not be possible or your options will be limited
LegalZoom vs. LegalShield: Customer Reviews
It’s fair to say customer reviews are one of the first things people search for when trying to decide if they should go with a particular company, product, or service. Let’s see what users have to say about LegalZoom and LegalShield.
LegalZoom Customer Reviews
Taking individual experience, mood, and state of mind into consideration, the most common complaints seem to be about hidden charges, LegalZoom not making it clear what is an add-on that can be opted out of, and customer service. Many people noted that they were still being charged for services they hadn’t received, or that had been canceled.
When it comes to customer service, many reviewers noted long wait times or it being impossible to get in touch with anyone at all, and when they did they were met with less than ideal assistance.
However, it’s not all bad. Those with positive experiences with LegalZoom said that they were able to have their legal questions answered quickly and for much less than they would have spent if they went with a law firm. The ample options available to customers is also a huge plus. Customers were able to complete any and all documents needed for their business without having to deal with multiple different companies.
LegalShield Customer Reviews
Out of all the LegalShield reviews, the negative ones seemed to have one common theme; those who were customers when it was called PrePaid Legal, are not satisfied with what the company has become. They note the lawyers are of lower quality, getting in touch with customer service is tricky, and people have experienced being charged for services even after notifying the company of cancellation.
Since the company continues to operate as an MLM (multi-level marketing) business, LegalShield as an overarching company doesn’t have full control over the attorneys offered and the way certain things are handled, so this may be an explanation for the varying degree of reviews.
Those who reviewed the business services were pleased with the sound advice and results they received from attorneys. Overall, those who have left positive reviews appreciate the knowledge and attentiveness of attorneys and just how much cheaper LegalShield’s services are compared to hiring an outside attorney.
The Bottom Line
If you’re a small business that is in need of legal advice for forming your business, on top of wanting to work with that same attorney when it comes to the necessary parts of operating your business, LegalShield is likely going to be your ideal option. The plan options come with unlimited consultations for all legal matters, in addition to the various other legal aspects like trial defense, document review, and calls/letters on your behalf.
On the other hand, if you’re a small business that has most things under control but needs some legal documents or services here and there, LegalZoom might be the better option. You can purchase documents as you need them and sign up for legal advice, and cancel, at any time. If you’ve already incorporated your business, you won’t need to worry about researching the different plan options for each type of formation and can jump right to making sure you’re operating your business legally.
When you look at LegalZoom vs. LegalShield, you will see that they offer very similar services, but narrowing down exactly how they each work and what your business needs from a legal service will help you determine which is best for you.
Jennifer Post is a freelance writer who has covered business topics including marketing, franchising, cybersecurity, health insurance, and hiring and retaining employees. She has also written about various finance topics such as startup funding, business bank accounts, retirement plans, and health insurance. Jennifer has specialized experience in social media management and knows the ins and outs of marketing a business through most social media platforms.
After briefly studying law at Widener University’s Delaware Law School, she went on to continue her small business writing career using her new legal knowledge to create content helping small businesses understand legal matters such as taxes, hiring and firing practices, harassment, and other company culture matters. You can find her work on Business.com, Business News Daily, and How Stuff Works.