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LegalZoom.com  -  Do not use legalzoom to set up a new business

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If you are looking for an inexpensive way to help set up your business, please be warned - LegalZoom will end up costing you much more in the end. At first, they seem like a great (and inexpensive) option. Their slogan of "We're here to help" is a complete lie. If you need ANY assistance after you've paid them, they will NOT help you.

I am someone who spends months researching companies, products, etc. before committing to a purchase. In late 2019, I decided to open my first business and needed help navigating the process. I wish someone had told me just how terribly LegalZoom treated their customers once they've already paid for a service. Unfortunately, I found out two years later. Their mistake ended up costing me thousands of dollars not to mention an excessive amount of time.

• October 24, 2019 - I started the process of setting up an S Corp via LegalZoom.

• November 15, 2019 - I received a notice from LegalZoom (screenshot below) that stated my S Corp filing would be AUTOMATICALLY DELAYED in order to avoid a franchise tax fee of $800 for 2019.

TWO YEARS LATER:

• October 21, 2021 - The Federal Tax Board sends me a letter stating I owed $800 plus penalties and fees from the tax year 2019.

• I told them this was a mistake and then sent a copy of the LegalZoom notice to the FTB, explaining that I had not paid it because my filing was delayed.

• As it turns out, LegalZoom had filed my business THREE DAYS before the cut-off — so I should have NEVER gotten the notice not to pay.

• Understandably, the FTB still said I owed them $800, HOWEVER, they said if I can get a letter from LegalZoom confirming the error, they would remove the fees and penalties.

• I contact LegalZoom and ask for a letter.

• PLEASE NOTE — I DID NOT ASK LEGALZOOM TO PAY THIS TAX BILL. I DID NOT ASK LEGALZOOM TO PAY FOR THE PENALTIES AND FEES. I DIDN'T EVEN AS LEGALZOOM FOR A REFUND FOR WHAT I HAD PAID THEM. I simply asked for a letter of acknowledgment that they sent this notice in error. That's it.

• They stated that the letter was sent to ALL CA businesses and that mine was not eligible. However, the notice clearly says YOUR BUSINESS ENTITY not SOME BUSINESS ENTITIES.

If at any point I thought this was a general notice, I would have called to confirm. But it was NOT a general letter, as you can see by the wording. It was specific to MY business.

What followed was hours and hours of emails, phone calls, chats, and social media DMs. They REFUSED to own their mistake. Because of this, the FTB would not remove the penalties and fees.

• October 21, 2021 - Make the first call to LegalZoom, speak to rep Lara who asks me to email her the waive notice over the phone so she can see it. She does. Says she needs to speak to a supervisor and will call me back. She does not call me back and instead sends a generic email stating they cannot provide a letter. No explanation.

• October 22, 2021 - Make a second call to LegalZoom, speak to rep Nikia who says she can't help me and that they cannot write a letter. I ask for a supervisor, but she says that's a "special request", there's no one she can transfer me to. She'll try to put in a request, but she doesn't think they will call me back. They do not.

• October 28, 2021 - Send another email to LegalZoom along with a message via Facebook. The Facebook rep says he will get the Escalations Dept involved.

• October 28, 2021 - Tanesha S. from the LegalZoom Escalations Dept sends me an email that still does not address the issue. I email her back with no response for several days.

• November 1, 2021 - I send another message to LegalZoom via Facebook to ask that Tanesha get back in touch with me. She does, via email. I ask if we can have a phone call.

• November 1, 2021 - Tanesha calls me and we discuss the issue. She understands the error, says she will talk to the Legal Dept, it will take her a couple of days, and that either way, she will get back to me. A week goes by with no response.

• November 8, 2021 - I leave Tanesha a voicemail, asking for an update.

• November 9, 2021 - Tanesha does not call me back but instead sends me an email with one line that says she cannot help me. No explanation.

At this point, fees and penalties have accumulated. I was forced to charge the entire amount onto a credit card. At a time when most of us are struggling to make ends meet, LegalZoom could not even type up a simple letter.

I understand mistakes happen. But when they do, the right thing to do is own it and then offer to make it right. LegalZoom did neither of those things. To say I am disgusted is an understatement.

PLEASE. If you are thinking of using LegalZoom for ANY services, do yourself a huge favor and DON'T. Save yourself patience, time, and money — and find somewhere else. They don't care about their customers. And I promise they won't care about you.

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