Business formation services help startups set up a legal entity, such as an LLC or a Delaware C corporation, without hiring a lawyer for every form.
They prepare and file your state paperwork, often name a registered agent, and sometimes add extras like an EIN, an operating agreement, compliance reminders, or founder stock documents.
Prices run from $0 plus state fees to several thousand dollars for a startup attorney, so the right choice depends on your entity type, your funding plans, and how much hand-holding you want.
Comparing provider features and reading a ZenBusiness review 2026 can help you understand its formation packages, pricing, and ongoing compliance services before choosing a provider.
This guide walks you through the whole decision. You'll learn which entity fits a startup, what the main services cost, where the hidden fees show up, how the leading options compare, and how to set up your company step by step.
Prices and terms come from provider and government pages checked in October 2026, each with a source and date.
Plans change often, so confirm the numbers on the provider's own site before you pay.
The Short Answer
- Picking an entity comes first. A service files whatever you choose, so decide between an LLC and a corporation before you compare brands.
- Bootstrapped or small business: A budget filer such as ZenBusiness, Bizee, or Northwest Registered Agent usually covers an LLC.
- Startup planning to raise venture money: Look at services built for Delaware C corporations, such as Stripe Atlas, Clerky, or Rho, or hire a startup attorney.
- Complex ownership, multiple founders, or investor terms: An attorney is worth the higher fee.
- Compare year two, not just year one. Registered agent renewals and subscription tiers decide your real cost.
What a Business Formation Service Does
A formation service files your state paperwork for you. For an LLC, that document is the articles of organization.
For a corporation, it is the certificate of incorporation. The SBA says an LLC's articles list the company name, address, member names, and registered agent, and that registration typically costs under $300 depending on the state (SBA, page modified August 28, 2026).
Most services bundle a mix of the following:
- Filing with the state
- A registered agent for the first year
- An EIN filing
- An operating agreement or bylaws template
- Annual report reminders or filing
- Extras such as business email, domains, website builders, or advisor calls
You don't need any of them. Every state lets you file directly with the Secretary of State or similar office, and the IRS issues an EIN for free.
A service earns its fee by saving time and reducing mistakes, not by offering something you can't do yourself.
Step One: Choose the Right Entity for Your Startup
Services file what you ask for, so choose the structure first. The SBA's guidance, summarized below, is a good starting point.
| Structure | Liability | Taxes | Fits best |
|---|---|---|---|
| LLC | Owners generally protected | Pass-through by default, with self-employment tax for members | Small businesses and bootstrapped startups |
| C corporation | The SBA says corporations offer the "strongest protection" for owners | Corporate profits are taxed, then shareholders pay tax on dividends | Companies raising money through stock sales or planning an exit or IPO |
| S corporation | Owners generally protected | Pass-through, but with IRS eligibility limits | Businesses that meet the S corporation rules |
The SBA says a C corporation fits companies that need to raise money through stock sales and those planning to go public or be sold.
It also notes that an S corporation is limited to 100 owners or fewer and excludes partnerships, corporations, and non-resident aliens as owners.
The IRS explains that an LLC is a state-law structure and is taxed as a disregarded entity, a partnership, or a corporation depending on its elections and number of members (IRS, limited liability company page, reviewed October 10, 2026).
Rule of thumb: If you expect to sell shares to venture investors, talk to a startup attorney about a Delaware C corporation from the start.
Rho's 2026 guide makes the same point, though Rho sells incorporation services, so weigh that source accordingly.
If you're launching a service business, online shop, or freelance practice, an LLC usually works.
The Main Types of Formation Services
Budget online filers
These advertise low or $0 base prices plus state fees, then sell upgrades. ZenBusiness, Bizee (formerly Incfile), Tailor Brands, Swyft Filings, and Inc Authority fit here. They work well for LLCs.
Registered agent specialists
Northwest Registered Agent leads with its registered agent service. Rho's comparison (published September 3, 2026, updated October 15, 2026) lists its formation at $39 plus state fees and a flat $125 a year for the registered agent.
Startup-focused incorporation services
Stripe Atlas, Clerky, and Rho specialize in Delaware C corporations with founder stock documents and sometimes 83(b) support. They cost more up front and include fewer upsells.
Startup attorneys
Rho's guide lists startup attorneys at $1,500 to $5,000 or more. You get advice tailored to your cap table and investors, which no template can match.
Quick Comparison of Popular Options
| Provider | Best for | Starting price (plus state fees unless noted) | Registered agent |
|---|---|---|---|
| ZenBusiness | Budget LLCs with tiered upgrades | $0 Starter, $199 Pro, $299 Premium | $199 a year add-on on every tier |
| Bizee | Lowest-cost LLCs | $0 | Free first year, then about $119 a year per Rho |
| Northwest Registered Agent | Privacy-minded owners | $39 | $125 a year |
| Stripe Atlas | Delaware C corps for startups | $500, which includes government fees | First year included, then $100 a year |
| Clerky | Founders who want legal documents | $427 pay-per-use, $819 lifetime | First year included |
| Rho | Startups that want banking in the same flow | $400 for a Delaware C corp, $349 all-in LLC | Covered the first year |
| Startup attorney | Complex ownership or fundraising | $1,500 to $5,000 or more | Arranged by the firm |
Sources: ZenBusiness (page modified October 7, 2026), Stripe Atlas, Clerky, and Rho's guides (updated October 2026).
Rho is a competing provider, so check its comparisons against each vendor's own page.
ZenBusiness: What You Get at Each Tier
ZenBusiness is one of the best-known low-cost formation services, and it shows how tiered pricing works.
According to its LLC page (last modified October 7, 2026):
| Feature | Starter | Pro | Premium |
|---|---|---|---|
| Price | $0 plus state fees | $199 plus state fees | $299 plus state fees |
| Renewal | Does not renew | $199 a year | $299 a year |
| Processing | 7 to 10 business days, rush upgrade $79 | 1 business day | 1 business day |
| EIN | Add-on, $99 | Included | Included |
| Operating agreement template | Add-on, $99 | Included | Included |
| Ongoing compliance | Not included | Annual report and up to 2 amendments a year | Same, plus Advanced Compliance |
| Registered agent | Add-on, $199 a year | Add-on, $199 a year | Add-on, $199 a year |
For a closer look at each tier, see the ZenBusiness pricing page. Premium adds a business advisor consultation, a document library, and a domain with business email.
Refunds: ZenBusiness says it offers refunds for any reason within 60 days of purchase, plus a 100% accuracy guarantee on its packages (ZenBusiness comparison page, updated September 23, 2026).
The page doesn't say which fees the guarantee covers, so read the full terms. State filing fees are usually not refundable once the state accepts them.
Things to double-check: ZenBusiness's own page describes the registered agent as a $199 yearly add-on on every package, even though a summary line on the page suggests it is included.
Another ZenBusiness comparison page describes the Pro plan as $199 plus $199 a year for compliance, while the LLC page lists the renewal at $199 a year.
Confirm what you're buying at the checkout.
Best for: Founders who want a low entry price, optional upgrades, and phone or chat support for a straightforward LLC.
Stripe Atlas
Stripe Atlas is built for startups that want a Delaware company with founder stock set up properly.
Its page lists a $500 one-time fee that includes government fees and the first year of registered agent service, with a renewal of $100 a year afterward.
What's included: Delaware incorporation with next-day expedited processing, a company tax ID, founder equity issuance and share purchase, an 83(b) election filing, and document templates for selling, hiring, and running the business.
The page says Stripe also offers product credits and partner discounts.
Banking: A bank account isn't part of the fee. Stripe says the $500 fee is refunded if you fund a Stripe Treasury account with $5,000 within 90 days of opening it.
Best for: Startup founders who want a Delaware C corporation quickly and plan to sell stock to investors.
Clerky
Clerky focuses on the legal documents behind a startup's first year. Its pricing page lists a Pay Per Use Incorporation package at $427 and a Company Lifetime Package at $819.
What's included: Clerky files the certificate of incorporation with the Delaware Secretary of State and says it typically returns the filed certificate within 2 to 3 business days.
A Post-Incorporation Setup package, listed at $299 under pay-per-use, covers documents such as the action of incorporator, bylaws, initial board consent, restricted stock purchase agreements, 83(b) forms, and invention assignment agreements.
The page doesn't clearly say whether that package is included in the Lifetime option, so confirm before you buy.
Best for: Founders who want a document-focused path to a Delaware C corporation.
Bizee, Northwest Registered Agent, and Tailor Brands
These three target the lower end of the price range.
- Bizee (formerly Incfile) advertises LLC formation for $0 plus state fees and one free year of registered agent service.
- Rho's reviews put the renewal near $119 a year (Rho, updated October 5, 2026).
- Northwest Registered Agent starts at $39 plus state fees with a flat $125 registered agent fee, according to Rho's comparison.
- Tailor Brands lists paid tiers at $199 and $249 a year, which are recurring annual fees, per Rho's comparison.
Rho
Rho lists a $400 Delaware C corporation and a $349 all-in LLC with state fees included, and it opens a business account in the same flow (subject to approval).
Because Rho publishes many of the comparison articles cited here, double-check any ranking against each vendor's own site.
What Formation Really Costs: The Hidden Items
The sticker price is only part of the bill. Watch for these.
State filing fees
Every state sets its own fee. According to LLC University (updated June 10, 2026) and Tailor Brands (updated August 13, 2026):
| State | Formation fee | Ongoing cost to know about |
|---|---|---|
| Wyoming | $100 | $60 minimum annual report |
| Delaware | $110 | Annual franchise tax (sources list $300 or $400, so check the state site) |
| New York | $200 | $9 biennial statement, plus a publication requirement of about $300 to $4,500 |
| Texas | $300 | No fee for most LLCs, but an annual Public Information Report is required |
| California | $70 | $800 minimum annual franchise tax |
Delaware's Division of Corporations publishes its current fee schedule and franchise tax calculator on its website (page dated August 1, 2026), so check it before you budget.
Registered agent renewals
Many services include the agent for one year only. After that, renewals range from about $100 to $299 a year across Stripe Atlas, Bizee, ZenBusiness, Northwest, and Firstbase, based on Rho's 2026 guide.
Subscription upgrades
A $0 plan can become a yearly charge when you add compliance, an EIN, or an operating agreement. Add the upgrades you'll actually need, then compare totals.
Annual compliance
Bizee estimates annual report filings may cost between $10 and $500, and total yearly ownership costs run at least $100 but rarely over $1,000, not counting taxes (Bizee LLC page, no date shown).
Rules Every Startup Founder Should Know
The EIN is free
The IRS says the online tool issues an EIN "for free" and warns people to beware of websites that charge for one.
Some services include EIN filing, and ZenBusiness lists it as a $99 add-on on its Starter plan, so compare that against the free IRS route.
Beneficial ownership reporting no longer applies to U.S. companies
FinCEN says U.S. companies are exempt from beneficial ownership information (BOI) reporting.
It finalized a rule on August 11, 2026 that took effect August 14, 2026. Only certain foreign-formed entities registered to do business in a U.S. state remain potentially subject to reporting (FinCEN BOI page).
Older articles and some service pages may still describe a filing requirement, so treat that language with caution.
Founder stock and the 83(b) election
If you form a corporation and issue restricted stock to founders, the 83(b) election is time-sensitive. BDO's summary (November 14, 2024) says it must be made within 30 calendar days after the property transfer, and that the IRS introduced Form 15620 for it in November 2024.
Procedures can change, so confirm the current process with the IRS or your attorney. Services like Stripe Atlas and Clerky include 83(b) support.
How to Choose a Formation Service?
- Pick your entity. Decide between an LLC and a corporation, and choose your state.
- Match your funding plan. If you plan to raise venture money, favor Delaware C corporation services or an attorney.
- List your must-haves. EIN, operating agreement or bylaws, registered agent, annual report filing, and rush processing.
- Price year one and year two. Include state fees, add-ons, and renewals.
- Read the refund terms. Check the window, what it covers, and how to request it.
- Test support. Send a pre-sale question and see how fast a person answers.
A Simple Step-by-Step Setup Plan
- Name and check availability in your state's business database.
- Choose a registered agent. The SBA says an LLC needs one in the state before filing, located in that state and able to accept official papers.
- File your formation document through the state or your chosen service.
- Draft governing documents. Use an operating agreement for an LLC or bylaws for a corporation.
- Get your EIN from the IRS at no cost.
- Open a business bank account and keep personal and business money separate.
- Issue founder equity and make any 83(b) election on time if you're forming a corporation.
- Add licenses and tax registrations required by your state and city.
- Calendar your annual filings so your company stays in good standing.
Common Mistakes to Avoid
- Choosing a service before choosing an entity.
- Ignoring the renewal price for the registered agent or compliance plans.
- Paying for an EIN when the IRS issues it free.
- Missing the 83(b) deadline after issuing founder stock.
- Forming in the wrong state. The SBA says an LLC will probably need to register in any state where it does business.
- Skipping legal advice when you have co-founders with different roles or investors on the way.
- Mixing personal and business funds.
How Many Startups Form Each Month?
New business filings are running at a high pace. The U.S. Census Bureau's Business Formation Statistics show about 534,947 seasonally adjusted business applications in September 2026, up 0.5% from August 2026 (release dated October 14, 2026).
Applications count EIN requests and cover many entity types, not only LLCs.
Frequently Asked Questions
Do startups need a business formation service?
No. You can file directly with your state and get a free EIN from the IRS. A service saves time and reduces mistakes, and some include documents that help with founder stock.
Which formation service is cheapest?
Several list a $0 base price plus state fees, including ZenBusiness, Bizee, LegalZoom, and Inc Authority, according to Rho. Compare the cost of the registered agent and add-ons, since those can change the total.
Is ZenBusiness good for startups?
It works well for straightforward LLCs with low entry pricing. If you plan to raise venture capital, review services built for Delaware C corporations, or ask an attorney first.
LLC or C corporation for a startup?
The SBA says a C corporation fits companies that raise money through stock sales or plan to be sold or go public, while LLCs suit many small businesses and offer pass-through taxation. Your funding plans should drive the decision.
Do I need a registered agent?
Yes. The SBA says an LLC needs a registered agent in your state before you file, and many owners use a service for it.
Do I have to file a BOI report?
Not for U.S. companies. FinCEN says domestic companies are exempt, effective August 14, 2026.
Can I switch services later?
Usually, though, the process depends on your state. Check the cost of changing your registered agent before you commit.
The Bottom Line
Start with the structure, not the brand. Bootstrapped founders forming an LLC can get a clean filing from a budget service such as ZenBusiness or Bizee, as long as they price the second year.
Founders heading toward venture funding should look at Delaware C corporation specialists like Stripe Atlas or Clerky, or bring in an attorney early.
Compare total cost over two years, read the refund policy, and confirm every price on the provider's own site.
Sources
- U.S. Small Business Administration, Choose a business structure. Page modified August 28, 2026.
- Internal Revenue Service, Limited liability company (LLC). Reviewed October 10, 2026.
- Internal Revenue Service, Apply for an Employer Identification Number (EIN) online.
- FinCEN, Beneficial Ownership Information. Final rule announced August 11, 2026, effective August 14, 2026.