Money for starting a business

How to Open a Business Bank Account for small business banking

Benefits of Business Bank Accounts.

By banking expert Sue Barrett.

Most of us need money for starting a business. Choosing the right bank account can even save you money and provide you with some nice benefits.

Business bank accounts offer many benefits, even if you own a small one-person business. Keeping your personal and business finances separate is essential and of course makes bookkeeping easier.

You will appreciate this even more during tax time. Handling your money for starting a business with a business bank account, you will also be able to write checks and accept customer payments to your business name, something that shows clients and business associates that you conduct business in a professional manner.

You gain respect and trust. In addition, having a relationship with a bank can help you establish credit, get a business credit card and even obtain financing if needed.

Just like any other product or service, before opening a bank account, you want to shop around to compare banking services. Do you want to save money with a basic account that charges minimal fees? Are you looking for additional merchant services, financing or hands-on customer service?

Do you want to be able to conduct all of your banking activities online or take advantage of online bill pay services? Consider the conveniences you want, and then ask banks what they offer small businesses - just in case you missed something.

When you have decided which bank you want to work with, set up an appointment to open an account with the banker. You will need to prove that you own a business, which means that you will need to provide documentation to the bank. The documentation required will depend on the structure of your business.

If you operate your business as a sole proprietor with a fictitious business name (you have not incorporated your business or formed a partnership), you will need to show a certified copy of the fictitious name certificate to the bank.

You get a fictitious name certificate from your city or county clerk after you have applied for and received your fictitious business name. Many people who want to handle their money for starting a business and one-person businesses operate using the sole proprietor business structure, as this is the simplest structure to use.

If you run your business as a corporation and want to open a corporate bank account, you will need an Employer ID Number. You would also need an Employer ID Number if your company will be hiring and paying employees. You obtain an Employer ID Number from the IRS, and you can complete the application form at their website.

You will also need to bring your certificate of incorporation, corporate seal, corporate resolution and photo ID. Opening a business bank account can be as easy as opening a personal account, and it does not necessarily cost a lot of money. In fact, you may be able to open a basic business bank account for free.

Look for These Business Bank Account Benefits:

  • Online Banking and Bill Pay
  • Checking account with No-Fee check writing
  • No-Fee ATM card
  • Free financial reporting and management tools
  • Ability to earn a high risk-free yield
  • Free transfers between your business checking and other accounts
  • FDIC Insured

When you've decided which bank you want to use, set up an appointment with a business banker to open your account.

For more instructions on money for starting a business bank account, including registering a business name, obtaining an EIN, incorporating your business and banks that offer business services, visit Small Business Banking 1-2-3.

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