How To Open A Business Account With Bank Of America – Similar to personal bank accounts, business bank accounts provide a certain level of protection when managing your company’s finances. A business bank account is often a necessary step in formally separating your company’s finances from your personal expenses and income.
However, there are a few steps you should consider before you just walk into the bank and apply for a business bank account. Read our guide to learn more about business accounts and what you need to do to open one for your company.
How To Open A Business Account With Bank Of America
Business bank accounts are financial accounts that are used only for business expenses or income. This includes business savings accounts and business checking accounts.
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Business bank accounts often offer unique advantages over personal bank accounts, including higher transaction limits and payments in the company’s name. Opening a business bank account is essential to building a business credit profile and is generally a requirement for most small business loan applications.
A business bank account is different from a merchant account that helps small businesses process credit card payments. If you want to accept credit card payments, you’ll need a merchant processing account in addition to your business bank account.
Small business bank accounts are available at traditional banks, credit unions, online banks and other financial institutions. Opening a business account for your company is just a few steps away.
One of the first steps in starting a business is obtaining the appropriate business license(s) for your organization to operate. You will need a business license to qualify for a business bank account. You may need a combination of federal, state, and local/city business permits to obtain the appropriate licenses for your business. To learn more about obtaining a small business license, visit the SBA.gov resource page.
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Another step required to open a business bank account in most corporate structures is finding or obtaining an EIN. This social security number is similar to a social security number, but is used for business loans. However, if you are self-employed, you do not need to get an EIN for your business. In such cases, your Social Security number may be used to apply for a business bank account.
This usually includes documents such as your business plan, memorandum of association, ownership agreement, certificates and similar forms, but the exact documents will depend on your business and/or the location where you operate. Also, depending on the structure of your business, you may need personal information from other business owners. This may include your social security number, driver’s license and/or passport.
When you’re ready to apply, it’s worth doing a little research online to find the right business bank account for your needs. You need to determine whether you want a business bank account, a business savings account, or both. Small business bank account features vary by financial institution and/or location, so you may find different options that better suit your needs.
Bonnie is a transplant surgeon from Chicago who wants to see the world on a dime. As a news junkie with a fascination for finance, he loves helping others do more with less. Editor’s note: This content is not provided by the companies mentioned. The opinions expressed here are solely those of the authors and have not been reviewed, endorsed or otherwise endorsed by the companies.
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Opening a business bank account is easy. You can also do it online. Learn more about the types and requirements and read some tips.
This increases your personal liability. Imagine what would happen if you were audited by the IRS. You’ll be glad you spent 5 minutes on the right business account.
Each type of business bank account has a different purpose. For example, checking accounts allow vendors to write checks.
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A savings account allows you to take advantage of higher interest rates. Merchant accounts allow you to accept debit and credit card sales.
After settling your bank account, it’s time to gather the documents you need to open an account.
You will be asked for your ID. You will need to show your SSN and a government-issued photo ID. For example, you can use your driver’s license.
In terms of business definition, each bank will have different requirements, but this mostly depends on the type of business structure you have.
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If you are self-employed, you must provide your SSN instead of your EIN. A limited liability company, partnership or other corporate document is essentially proof that your business exists.
If you use another name (your company’s legal name) for advertising and marketing, a DBA certificate is required.
On the other hand, non-profit and unincorporated associations are required to submit a signed declaration. Corporations are also required to submit a company resolution to obtain bank details.
Also, the 501(c) letter is for non-profit organizations. Serves as proof of tax exemption from the tax administration.
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The process of opening a small business bank account is very similar to opening a large business account. But small business bank accounts tend to require less paper.
To open a small business bank account, you’ll need to provide your employer’s or social security number along with your business name document.
Make sure you have a physical copy of your documents. You can prepare a deposit check. Then make an appointment with the bank.
You will work with a professional to open an account. This process may take a little longer than opening an account online. But opening an account in person means that you can solve all your problems and questions with a bank employee.
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If you work in a certain industry or business, banks may require you to open an account in person. For example, you could work in telemarketing, gambling, government, or the precious metals industry.
Whether you open an account online or in person depends on your priorities. Do you prefer to submit physical documents? This makes it easier to sign documents if needed.
Not all traditional banks have online applications. If you need access to physical branches, you may need to apply in person. But applying online means you can check in anytime, even after hours.
When opening a business account online, the form can be submitted digitally. You can also scan a hard copy of the document.
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There are usually no fees for opening a business-only bank account, but the bank may require a deposit to open one.
In some cases, banks offer financial incentives for opening a bank account if certain conditions are met. Be sure to ask your bank about business bank account incentives.
You make your first deposit into a business account, similar to a personal bank account. You can pay by cash, check (eg from your personal account) or money order.
Note that your bank may charge certain types of deposit fees. For example, there may be a fee for a cash deposit. It is best to find out which deposit methods your bank allows. Find out if you can deposit money remotely, online or in person.
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You should also make sure you meet the minimum deposit requirements. Otherwise, you may be charged. And that is that! Now you can manage your business finances efficiently with your new business bank account.
Some charge a monthly service fee. Other banks waive the fee if you meet certain conditions.
Online banking is likely to have lower fees. However, cash deposits are not permitted. You need to determine if your business can operate without cash.
Business owners can greatly benefit from services such as cash flow visibility reports. A personal bank account may not have this. It’s best to find out if the banks you’re considering have these tools.
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Do they have online or mobile banking? The mobile app is great for tracking balances, making payments and transferring money.
Also, think long-term and consider whether you need other financial services, such as a small business loan or line of credit. You can check if your potential bank provides them.
If you are a small business owner and need advice on the following, you can get help from your local SBDC or Small Business Development Center.
There is much more technical assistance they can provide. They can help you work with the SBA. This will go a long way in helping you achieve your business goals.
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Some banks will have introductory offers. This can be a cash bonus for a certain initial deposit. Or it can be about maintaining a certain balance over a period of time.
Consider whether you will have a wide network of personal services. Or if there are enough convenient ATMs if you need them.
Some banks have minimum balance requirements. This means that you should always have a certain amount of money in your account.
Big enough balance
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