"Form your LLC for FREE!" - You've seen these ads everywhere. Services like Inc Authority, ZenBusiness, and others promise free LLC formation. But is it really free? Let's pull back the curtain on what "free" actually means.
The Good: What You Actually Get for Free
Let's be fair - these services do offer something valuable at no service charge:
- Basic LLC filing - They'll prepare and submit your Articles of Organization
- Name availability check - Verification that your LLC name is available
- Standard processing - Filing with the state
You Still Pay State Fees:
- Wyoming: $100
- Delaware: $90
- Texas: $300
- California: $70 (plus $800 franchise tax)
So "free" really means "free service fee" - state fees always apply.
The Trap: The Year 2 Surprise
Here's what catches most founders off guard: Registered Agent renewal fees.
Every LLC needs a Registered Agent - a physical address in the state to receive legal documents. "Free" services include the first year of Registered Agent service in their package. But what happens in Year 2?
Typical Renewal Costs:
- Inc Authority: $199/year
- ZenBusiness: $199/year
- Northwest Registered Agent: $125/year
- LegalZoom: $299/year
That "free" LLC now costs $150-300 per year just for the Registered Agent service.
The Upsells: Where They Really Make Money
Free services are designed as a funnel. Once you're in the system, you'll face aggressive upsells:
USBizGuru can handle this for you.
Our Complete package includes LLC formation, EIN filing, and compliance guidance.
See pricingCommon Upsells:
| Service | Typical Price | Reality |
|---|---|---|
| EIN Filing | $70-150 | You can do this yourself for free (just slower) |
| Operating Agreement | $99-149 | Templates are available online |
| Corporate Kit | $99-199 | Mostly unnecessary for small LLCs |
| Annual Report Filing | $100-150 | Can be done yourself in 5 minutes |
| Business License Research | $99 | Google works fine for this |
| Banking Resolution | $30-50 | Banks provide this free |
| Expedited Processing | $50-200 | State expedite fees are usually lower |
The Real Cost of "Free"
Let's do the math for a typical "free" LLC over 3 years:
Year 1:
- Service fee: $0
- State fee: $100
- EIN filing (upsell): $99
- Operating Agreement (upsell): $99
- Total: $298
Year 2:
- Registered Agent renewal: $199
- Annual Report filing (upsell): $100
- Total: $299
Year 3:
- Registered Agent renewal: $199
- Annual Report filing: $100
- Total: $299
3-Year Total: $896
The USBizGuru Approach: Transparent Pricing
At USBizGuru, we believe in honest, upfront pricing. Our packages include:
What's Included:
- LLC Formation with state filing
- Registered Agent (1 year)
- EIN Filing (in Complete package)
- Operating Agreement
- BOI Filing guidance
- Banking guidance
Renewal Costs:
- Annual Registered Agent: Competitive rates
- Annual Report Filing: DIY guide provided free
- No hidden fees or surprise upsells
How to Make the Right Choice
When comparing LLC services, ask these questions:
- What's the Registered Agent renewal cost?
- Is EIN filing included or extra?
- What are Year 2 and Year 3 costs?
- Do they understand international founder needs?
- What support is included?
Bottom Line
"Free" LLC services aren't scams - they're just using a common business model. The service is subsidized by upsells and renewals. For some founders, this works fine. But for Indian founders who need EIN filing, banking guidance, and ongoing support, a comprehensive package often makes more sense.
See our transparent pricing - No surprises, no aggressive upsells.
