Do you need an attorney to form an LLC or corporation?

No, you do not need an attorney to file forms to create a company. You may form a partnership, LLC or corporation without an attorney. You can do it yourself, i.e. prepare and file the legal paperwork, or use a service, such as LegalZoom, to do so but be aware that these forms and filing services, like LegalZoom, cannot provide you legal advice or representation like an attorney. LegalZoom specifically disclaims (http://www.legalzoom.com/terms-of-use.html) it is acting as your attorney and states:

“...At no time do we review your answers for legal sufficiency, draw legal conclusions, provide legal advice or apply the law to the facts of your particular situation. LegalZoom and its Services are not substitutes for the advice of an attorney.

....LegalZoom strives to keep its legal documents accurate, current and up-to-date. However, because the law changes rapidly, LegalZoom cannot guarantee that all of the information on the Site is completely current.

...Furthermore, the legal information contained on the Site is not legal advice and is not guaranteed to be correct, complete or up-to-date. Therefore, if you need legal advice for your specific problem, or if your specific problem is too complex to be addressed by our tools, you should consult a licensed attorney in your area.”

These services are inexpensive because they are filling out forms which is typically the least time consuming aspect of business formation for an attorney. You assume the risk that the forms you direct them to prepare and file are not appropriate.

If you have questions, for example, concerning taxation, liability of the owners, funding, operation, or management of the entity, and other issues not directly related to formation of the entity, or if you need to determine whether to form your business as a corporation, LLC or some other legal entity, you should take the time to consult with an attorney to avoid future problems.

Besides selecting the proper entity, an attorney can identify issues which should be considered. For example, if you are forming a business with other persons or investors, you should almost always consult with an attorney. Participation in a profit-sharing agreement usually creates a "security" (the agreement does not have to be in writing to be a security) unless there is also an ownership interest and, if there's a security, that means compliance with the security laws. The California Corporate Securities Law can be complex, for example, it expressly exempts a promissory note secured by a lien on real property but a note in which fractional interests are sold, or one of a series of notes secured by the same property, is not exempt.

Similarly, the offer or sale of debt securities can also be exempt from qualification as a security if no public offering is involved. [Corps.C. § 25102(e)] This exemption covers not only the offering, but also the sale and issuance of the securities themselves. The § 25102(e) exemption applies only to debt securities: e.g., promissory notes, bonds, debentures or any other evidence of indebtedness, whether secured or unsecured, and to any guarantees thereof [Corps.C. § 25102(e)] in a "private" sale but the point is that it has to structured to qualify for the exemption otherwise the lender will sue for violation of the security laws protecting investors.