You're correct when you say that creating a LLC is not hard to do. IANAL, but creating a LLC might not be the best choice of incorporation for a startup though. The referenced Y Combinator company Clerky helps incorporate startups as Delaware C-Corps for a grand total of $381 [1]. That's about as cheap as legalzoom, not including the filing fees for California LLCs (which are $800 a year to the Franchise Tax Board). [2]

[1] https://www.clerky.com/pricing [2] https://www.ftb.ca.gov/businesses/bus_structures/LLCompany.s...

If you're based in Calif, there is no benefit tax-wise to filing in Delaware. Calif will tax you on the dollars you earn in Calif., regardless of where you incorporate. As an LLC, the minimum tax in Calif is $800. So, if you're based in Calif. you might as well incorporate in Calif too and save the $381 to incorporate in Delaware and pay the annual Delaware fees. I know this b/c I went through this very mistake a few years back.

If you want to take external investors money, you need to incorporate in Delaware. If you are just bootstrapping then there's no need to do this and you may as well just incorporate in California as you suggest (ie it's not about tax optimization!)

One problem with dealing with the state of California is that mail correspondence sometimes span many weeks. You may not receive your endorsed LLC paperwork for a quite while. And if your form has an error, the state will return your rejected LLC paperwork, and start the clock again. In most cases, its worth paying somebody to avoid these delays.

What's wrong with waiting 'many weeks'? Your idea is not going anywhere, and if it is, it's a bad idea.

If you want to do business before the LLC, you can go ahead. Then, once the LLC is formalized, transfer any assets you've created or acquired to it. For example:

http://www.newyorksmallbusinesslaw.com/new_york_small_busine...

As far as making mistakes goes, the paperwork is simpler than filling out doctor's paperwork on a new office visit. For any gaps, it's not hard to read NOLO, and the experience will help you grow as a business person as you learn self-reliance

And, FWIW, Legal zoom has to push the paperwork through the exact same process. The processing time will be the same either way, but you'll likely pay legalzoom a premium on top of the expedited service fee the state charges them.

https://www.legalzoom.com/assets/modals/modal-priority-rush-...

https://legalarrow.com/LLC/ProcessTimes.htm

I agree, Nolo > LegalZoom.