What You’ll Need to Open a Business Checking Account

Understanding the importance of business bank accounts

The U.S. Small Business Administration recommends opening a business checking account whenever your business is ready to start accepting or spending money. That’s because combining your personal and business financials is not recommended. In fact, some business owners even prefer creating separate accounts at separate banks in these matters. 

That’s because having a business account is not only more professional, it actually provides greater security, clearer accounting and other benefits and features that personal bank accounts simply do not offer.   Let’s have a look:

  • Professionalism: Remember hearing about the importance of making a great first impression? Well, it’s true. Individuals and businesses perceive other businesses more favorably when they write checks to and receive checks from a business account as opposed to a personal one.  Having a separate business account gives you the possibility of having checks in your business’ name, a company debit card, as well the flexibility to have authorized employees, like a bookkeeper, perform financial tasks directly to your account.  
  • Protection: Business banking services offer limited liability protection by keeping personal and business finances separate. Business checking accounts also tend to be more secure in that they may have stricter anti-fraud rules.
  • Organized Bookkeeping: Can you imagine the mess of having to untangle all of your personal and business transactions every month? Having your finances separate is a must for having clean, organized financial records especially at tax time. Your accountant will thank you.  
  • IRS: The IRS can decide whether it deems your business a ‘hobby’ or a legitimate business by tracking activity over the years. A business checking account helps ensure a degree of transparency as well as a well-maintained set of business books.
  • Additional Valuable Service: Having a business account can help you qualify for a business line of credit. Building a strong credit history is one of the more important things an owner or principal can do for a growing business. Lines of credit are there to help you with key purchases when cash flow is tight and in case of emergencies.

open a business checking account
Lastly, let’s talk about what you need to open a business checking account and what to look out for. 

Here are some of the most common documents you need to provide to open your account: 

If you have a Sole Proprietorship 

  • Business Tax Identification Number (EIN): It’s an identification number assigned to your business to have a tax presence independent of your Social Security Number (SSN) and is needed for filing taxes. To obtain an (EIN) you need a valid Social Security Number and file on behalf of a company in the United States. This can be done online if you gather all the required information. 
  • Business license: Is a license from a state that gives you permission to run your business in that state.  
  • Business name filing document: This means to have your business’s name registered with the government. You have to file a business name filing document to get it processed.

A General Partnership/ limited partnership/ limited liability partnership 

  • Business Tax Identification Number (EIN)
  • Partnership agreement: It is an agreement between company founders on key issues the company will face, and how it will conduct business. 
  • Organizing documents
  • Business license 

A Limited Liability Company 

  • Social Security Number (SSN) or Business Tax Identification Number (EIN)
  • Articles of organization: It is a document by the state containing important information like name, address, members, registered agent, management structure, and the activities it will conduct.
  • Certificate of organization: This certificate recognizes formally the articles of organization
  • Certificate of assumed name

An S-Corp

  • Social Security Number (SSN) or Business Tax Identification Number (EIN) 
  • Articles of organization
  • Certificate of organization
  • Organizing document filed with a state
  • Certificate of assumed name
  • Balance sheet 

What to look out for and things to consider when opening a business checking account:

  • Introductory fees
  • Interest rates for savings and checking accounts
  • Interest rates for lines of credit
  • Transaction fees
  • Early termination fees
  • Minimum account balances fees 

At Banesco USA we offer a variety of services and benefits for our business clients including:

  • No maintenance fees when maintaining the minimum daily required balance
  • First 150 items per month at no cost 
  • Banesco VISA check card at no cost
  • First check order at account opening at no cost
  • Online and mobile banking
  • Electronic statements at no cost 

Opening a business account is easier than you may think. If you are looking to open a business checking account, you can reach one of our experienced personal bankers by calling +1 (888) 228-1597, or by visiting one of our convenient branch locations.  

The information provided by Banesco USA ("we," "us," or "our'') is for general informational purposes only and is not intended as legal, tax, investment, financial or other advice or a substitute for professional advice. The information is general in nature and does not address the circumstances of any particular individual or entity, and is not comprehensive or a complete statement of the matters discussed herein. All information contained herein is provided in good faith, however, we make no representation or warranty of any kind, express or implied, regarding the accuracy, adequacy, validity, reliability, availability or completeness of any information provided herein. The information provided may contain information from third parties or other sources. We do not warrant, endorse, guarantee, or assume responsibility for the accuracy or reliability of any information offered by third parties. Under no circumstances shall we have any liability to you for any loss or damages of any kind incurred as a result of the use of or reliance on any information provided herein. Your use and reliance on any information provided herein is solely at your own risk.
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