If you are going to operate a business, whether it is located in a brick and mortar building or operated entirely online, you should strongly consider opening a business checking account. Doing this will enable you to keep your personal and business funds separate, which will make for much easier bookkeeping. It will also save you a lot of grief as you try to keep track of your business’ progress on a daily or weekly basis.
First Up – Do Your Homework
Before you open a business checking account you need to research the different banks in your area. The first place you should start is the bank you currently use for your personal accounts. If you tell them that you’re planning to open a business they might offer you some type of special discount on fees (or waive them entirely). They might also offer you some additional business incentives, so don’t be afraid to ask about them.
In addition, you need to be sure of the other features or products that are offered along with your new checking account. Look for such offerings as debit and credit cards, free checks, online banking capability, and free bill pay. Make sure that the bank isn’t going to charge any fees for these items before you make your final decision.
Get Your Paperwork in Order
As with many things in life, there is a certain amount of paperwork involved with opening a business checking account. The different types of documents you need will more than likely depend on the type of business you are planning to launch and may also depend on the state in which you live.
For the most part you should plan to have your social security number, the EIN for your business, and the previous year’s bank statements or tax forms for your business (if applicable) handy. The bank you choose may not request your business’ previous tax forms or bank statements, but it is best to be prepared just in case.
Be Proactive
Once you have opened your new business checking account make sure that you check the status of your account every day. It is important that you stay on top of your account activities, which is why having online access to your account is so important. Choose a bank that you know has a reputation for being reliable, and one whose website has very little downtime for customers.
As a business owner you are probably going to be very business and may not have much time each day to check your bank account. You need a reliable online service that will be up and running pretty much 24/7 without lengthy downtime so you can check your account day or night. If you can’t find sufficient information about a bank’s service and reliability online, don’t hesitate to ask the manager at the bank for detailed information about their internet reliability. This will be an extremely important part of your business operations, so make sure you gather all of the information you need before choosing a bank to do business with.
Opening a business checking account for your small business is a smart move to make. It will keep your business expenses and earnings separate from your personal ones, which will make things much easier for you at tax time each year.
