You’re comparing formation services.
But pricing pages are confusing. “All-inclusive” doesn’t mean what you think. Hidden fees appear later.
You need to decode the pricing.
What’s included. What’s extra. What’s hidden. How to compare.
This guide shows you how to spot the tricks.
Pricing tactics. Hidden fees. Comparison framework. Your protection.
Read this. Decode the pricing. Compare fairly.
Key Takeaways
- 'All-inclusive' often excludes key costs—registered agent services, annual reports, business licenses, and expedited processing are commonly excluded
- Base prices rarely include everything—publication requirements, name reservation, EIN application, and operating agreements are often extra
- Ongoing costs are rarely mentioned upfront—annual reports, franchise taxes, and registered agent renewals add hundreds per year
- Expedited processing is almost always extra—standard processing times are slow, and faster options cost significantly more
- Compare total first-year costs, not just initial fees—the true cost includes initial formation plus all ongoing requirements for the first year
Table of Contents
Why Pricing Tricks Matter
Pricing tricks cost you money.
What happens if you fall for tricks:
- Pay more than expected
- Face surprise fees
- Get locked into expensive services
- Waste money
What happens if you spot tricks:
- Compare fairly
- Avoid surprise fees
- Choose the best value
- Save money
The reality: Understanding pricing tricks saves money and prevents surprises.
Trick 1: All-Inclusive Exclusions
What It Looks Like:
- “All-inclusive formation package”
- “Everything you need included”
- “Complete formation service”
What’s Actually Excluded:
- Registered agent services
- Annual reports
- Business licenses
- Publication requirements
- Expedited processing
How to Spot It:
- Read the fine print
- Check what’s “included”
- Look for “additional fees may apply”
- Ask what’s not included
Pro tip: “All-inclusive” rarely means everything. Always check what’s excluded. See our true cost guide for what formation actually costs.
Trick 2: Base Price Limitations
What It Looks Like:
- Low base price advertised
- “Starting at $X”
- Simple pricing structure
What’s Actually Extra:
- Publication requirements
- Name reservation
- EIN application
- Operating agreement
- Compliance documents
How to Spot It:
- Check what the base price includes
- Look for add-on fees
- Ask about required extras
- Calculate total cost
Pro tip: Base prices are often misleading. Always calculate the total cost with all required services.
Trick 3: Hidden Ongoing Costs
What It Looks Like:
- Low initial price
- No mention of ongoing costs
- “One-time fee” emphasis
What’s Actually Required:
- Annual reports
- Franchise taxes
- Registered agent renewals
- Business license renewals
- Compliance tracking
How to Spot It:
- Ask about ongoing costs
- Check annual requirements
- Calculate first-year total
- Plan for ongoing expenses
Pro tip: Ongoing costs are rarely mentioned upfront. Always ask about annual requirements. See our budgeting guide for planning costs.
Trick 4: Expedited Upsells
What It Looks Like:
- Standard processing is slow
- “Expedited” options available
- Faster processing for extra fee
What’s Actually Happening:
- Standard processing is intentionally slow
- Expedited is often necessary
- Extra fees for reasonable speed
How to Spot It:
- Check standard processing times
- Compare expedited costs
- Ask if expedited is necessary
- Factor speed into total cost
Pro tip: Expedited processing is almost always extra. Factor this into your total cost comparison.
Comparison Framework
Use this framework to compare providers fairly:
Step 1: List All Required Services
What to include:
- State filing fees
- Publication requirements
- Registered agent services
- Business licenses
- EIN application
- Operating agreement
- Expedited processing (if needed)
Why it matters: You need to compare total costs, not just base prices.
Step 2: Calculate Initial Costs
What to calculate:
- Base formation fee
- All required add-ons
- Expedited processing
- Publication fees
- Name reservation (if needed)
Why it matters: Initial costs vary significantly between providers.
Step 3: Calculate Ongoing Costs
What to calculate:
- Annual reports
- Franchise taxes
- Registered agent renewals
- Business license renewals
- Compliance tracking
Why it matters: Ongoing costs add up over time.
Step 4: Compare Total First-Year Costs
What to compare:
- Initial costs + ongoing costs
- Total first-year expense
- Value of included services
- Quality of service
Why it matters: Total first-year cost is the real comparison.
Pro tip: Compare total first-year costs, not just initial fees. See our pricing framework guide for a detailed comparison template.
Red Flags
Watch for these red flags:
Red Flag 1: Vague Pricing
What it looks like:
- “Starting at $X”
- “Contact for pricing”
- Unclear what’s included
Why it’s a problem: Vague pricing hides true costs.
Red Flag 2: No Ongoing Cost Disclosure
What it looks like:
- Only shows initial price
- No mention of annual fees
- “One-time fee” emphasis
Why it’s a problem: Ongoing costs are significant.
Red Flag 3: Required Add-Ons
What it looks like:
- Base price is low
- Many required add-ons
- Total cost much higher
Why it’s a problem: Base price is misleading.
Red Flag 4: Pressure to Upgrade
What it looks like:
- Push for expedited processing
- Upsell to premium packages
- Pressure to add services
Why it’s a problem: You may pay for unnecessary services.
Pro tip: Red flags indicate pricing tricks. Be cautious and ask questions.
Your Next Steps
Decode the pricing. Compare fairly. Avoid tricks.
This Week:
- Review this guide
- Understand pricing tricks
- Use comparison framework
- Compare providers fairly
This Month:
- Get quotes from multiple providers
- Calculate total first-year costs
- Compare fairly using framework
- Choose the best value
Going Forward:
- Watch for pricing tricks
- Ask about hidden fees
- Compare total costs
- Avoid surprises
Need help? Check out our true cost guide for what formation actually costs, our budgeting guide for planning costs, and our pricing framework guide for a detailed comparison template.
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Sources & Additional Information
This guide provides general information about formation pricing. Your specific situation may require different considerations.
For true formation costs, see our True Cost Guide.
For budgeting, see our Budgeting Guide.
For pricing comparison, see our Pricing Framework Guide.
Consult with professionals for advice specific to your situation.
