What Do I Need to Open a Business Bank Account?
If you run certain types of businesses, you will need to have a bank account specifically for your business finances. This business bank account must be entirely separate from your regular personal account. You will need to have specific documentation to open a business account, and we’ll cover what those requirements are.
Types of Businesses That Require a Separate Business Bank Account
Essentially, unless you’re a sole proprietor, you should have a business bank account — and they’re even a good idea for sole proprietors as well.
A business bank account helps you in several ways:
- Stay legal and compliant with federal and state finance and tax rules
- Track your business money and costs so you can understand your organization’s finances
- Maintain liability separation between your business and personal money
- Make it faster and easier to do your accounting and bookkeeping
- Assist in qualifying for financing and loans
- Create a more professional impression with clients
For more information on the process of opening a business bank account, read our guide.
Paperwork Needed to Open a Business Account
It’s important to get all your documents in order. That will minimize the time it takes to get your business bank account up and running. Most banks will typically ask for the following information when you’re opening a business account:
Banks will typically require all these documents to be originals or certified copies. If you’re opening an account at a banking location, all owners, partners and key executives should be present. If you’re opening an account, you should be an owner of the business.
Employer Identification Number or Social Security Number
Most businesses should have an Employer Identification Number (EIN), and LLCs and corporations must have one. You can get an EIN directly from the IRS, or Incfile can get you an EIN on your behalf. You will need to provide the EIN as part of your account creation. Some businesses, like sole proprietors, can use the Social Security number of the owner instead.
Personal Identification That Proves Who You Are
Banks will require both business and personal identification documents. These will need to be issued by an official state or federal government body, so documents like a passport or driver’s license qualify. Some banks will also request a second form of identification. You can contact your bank to find out what is acceptable as a secondary document.
Business License to Operate Your Business
Many states and local municipalities require you to have a business license to operate in your area. If that’s the case, banks will want to know that you have the proper authorization. If you’re not sure what business licenses you need, Incfile can help. We offer a complete Business License Research package that will tell you exactly what permits and licenses are required to run your business.
These licenses and permits may need to be renewed on an annual basis.
Doing Business As, Assumed Name or Trade Name Certificate
You may choose to do business under a different name from your legal business name. For example, your business might be called “Lightfoot Mercantile Holdings LLC,” but you operate under the brand of “Alphaplus Wholesale and Distribution.” In those cases, you need to file with your state authorities to let them know about the name you’re using.
These filings are variously known as trade names, assumed names, fictitious names or doing business as (DBA) names. You typically file an assumed name with your Secretary of State, although rules do vary between states. If you need to file an assumed name for your business, Incfile can do that on your behalf. If you’re operating under a name that’s different from your business name, you will need to provide the relevant document to the bank.
Operating Agreement or Corporate Bylaws
Every formal business, such as an LLC or corporation, should have rules in place that govern how the business is run. In an LLC this is known as the “Operating Agreement,” and a corporation calls it “bylaws”.
LLC Operating Agreements cover areas like how the business is divided among owners, who the decision-makers are, how profits will be divided and what happens if a member or manager joins or leaves the business. Corporate bylaws serve a similar function.
Incfile can help you create an Operating Agreement tailored to your business, and this service is included with our Gold and Platinum business formation packages.
Articles of Organization or Incorporation
Finally, you will need the official documents that you’ll receive after you form your business. As part of creating your business, you will provide information to your Secretary of State or other formation body. Once the application is processed, they will send you your Articles of Organization (LLC) or Articles of Incorporation (corporation). This document proves to the bank that your business has been formally and legally recognized by your state.
Do you need to form an LLC, S Corporation, C Corporation or nonprofit? We can help.