How to Set Up a Business Account at the Bank

By eHow Business Editor

Rate: (8 Ratings)

Getting a business checking account will help you track income and expenses and prevent intermingling with your personal accounts.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

  • Checkbook Wallets
  • Calculators
  • File Cabinets
  • Banks
  • Checking Accounts
  • File Folders

Determining Your Business Checking Needs

Step1
Establish how your business is owned. Is it a sole proprietorship, partnership, corporation or nonprofit? You'll find that certain accounts are more suitable to your needs depending on how your business is structured.
Step2
Figure out the number of deposits you normally make each week or month. A low-cost, basic plan may suit your needs if you make only a couple of deposits a week.
Step3
Look at your last statement and calculate how many checks you usually write each week or month. A basic plan typically has limited check-writing privileges.
Step4
Determine how much cash you deposit and withdraw each month.
Step5
Examine your last statement to see the minimum and average balances you usually maintain.
Step6
Decide if you want to do all of your transactions via ATM, the night depository or online. Do you prefer to do all of your banking in person? Banks usually charge higher fees for in-person banking.

Signing Up for the Account

Step1
Have the right documentation with you. All banks will require you to prove that you are a business. Eligibility requirements and the required documentation to open a business checking account vary by ownership type.
Step2
Provide a taxpayer ID number to open the account regardless of ownership structure.
Step3
Provide a certified copy of the fictitious name certificate if you are a sole proprietor and the account title is a business name other than yours. You must put your signature on file and you may authorize additional people to sign checks.
Step4
Provide a certified copy of the fictitious name certificate for any business whose account titles are different from the names of the owners. Place on file with the bank the signatures of those who will be granted access to the account. Each signer must provide two current pieces of identification that include the signer's signature.
Step5
Submit, in addition to the above information, a copy of the IRS Ruling on Tax Exemption, a statement on corporation letterhead indicating the corporation's tax-exempt status, and an employer identification number (EIN) for a nonprofit organization.

Tips & Warnings

  • Find a reputable bank that you've done prior business with. This could be the institution where you keep your personal accounts.
  • Select a bank that's conveniently located and easily accessible.
  • Be sure to take the time to choose the most appropriate account for your business. Picking the wrong one could cause you to pay an unnecessarily high amount in bank fees.

Comments

| View All Comments
wsmith

wsmith said

Flag This Comment

on 3/28/2007 I completely agree with this comment. It seems that it applies to everyone except the last part needing an EIN for nonprofit organization. Do you need all (3) items for a nonprofit organization or just the last?

Anonymous

Anonymous said

Flag This Comment

on 11/22/2005 Your final point on this page is, I feel, unclear:

"Submit, [you say] in addition to the above information, a copy of the IRS Ruling on Tax Exemption, a statement on corporation letterhead indicating the corporation's tax-exempt status, and an employer identification number (EIN) for a nonprofit organization."

This certainly makes these steps sound compulsory, although certainly only the EIN can be compulsory. You should insert the phrase "if applicable." One never knows what level of knowledge the reader of a "How to..." article may have already, experienced or clueless.

View All

Post a Comment

POST A COMMENT

Request a New How-To Article

Looking for more How To information? Chances are there’s an eHow member who knows how to do what you’re looking to do. Submit an article request now!

eHow Article: How to Set Up a Business Account at the Bank

eHow Business Editor

eHow Business Editor

Category: Business

Articles: See my other articles

Related Ads