I'm finally taking the plunge and forming an LLC for my freelance design work. A friend told me I absolutely need a lawyer or I'll screw something up. But I've seen those online services for like $50. What's the real risk here? Is it just upsell fear or am I actually going to create a mess I can't fix?
LLC Formation
Do you really need a lawyer to start an LLC?
Depends on your state and how complicated your business is. For a single-member LLC with no employees, no real assets, and a basic operating agreement? You can absolutely do it yourself. The forms are online. Just don't come crying to me when you mess up the publication requirement in New York.
I used one of those online services. It was fine. Took 20 minutes. The only annoying part was the registered agent upsell they push at checkout. Just say no.
The 'you need a lawyer' crowd is the same crowd that tells you not to change your own oil. Yeah, a lawwyer is safer. But for a basic LLC? It's a form. You're not drafting a merger agreement. Save your money.
That's kinda what I figured. I'm in Colorado if that matters. No employees, just me. I mostly want the liability protection and to stop getting 1099s with my SSN on them.
Colorado is pretty straightforward. The Secretary of State website is actually decent. I filed mine myself two years ago and it was like $50. The hardest part was coming up with a name that wasn't allready taken.
Since you're in Colorado, look up the periodic report requirement. It's easy to forget and then you get administratively dissolved. That's the kind of thing a lawyer would remind you about, but a calendar reminder works too.
Lawyer here (not your lawyer, don't sue me). The people saying 'it's just a form' are mostly right for a simple LLC. But the operating agreement is where people get themselves in trouble. If you have a partner, or you ever want to bring one in, pay a lwyer to draft that. The boilerplate ones online are garbage.
Yeah but Dave, OP said it's just them. No partners. Boilerplate is fine for a single member.
Also, the online services charge you like $300 for a 'certfiicate of good standing' that you can get from the state for $10. That's the real scam.
One thing I'd add: if you're going to hire a lawyer at all, do it for a one-hour consult to review your operating agreement. Cheaper than having them do the whole thing and you still get eyes on it.
This is all super helpful, thanks. I think I'll file myself and maybe pay for a consult on the operating agreement. Or just find a decent template. Still deciding.