How to set up a checking account for my business?

Question

I would like to be able to cash checks written out to my business name. I was wondering if there was a way to do that without setting up a business account. My goal is to be able to sign my name on the back of a check that was written out to my business. Can anyone help?

I have talked with my bank and they are trying to encourage me to set up a business account. I have two seperate accounts now. I use one for personal and one for business but the business one is a "personal type" account. I guess I was reluctant because the account I have now for business is a free account with no minimum balance. I am just not sure how I would be able to cash a check written out to my business name. I don't want to put it down and then not be able to cash it.

I have a tax id number but it is just in my name.

It is a small, home based, no employee business.

Answer 1

Talk to your bank, but as a business owner myself, I find it easier at tax time to have separate accounts and it certainly would help a bunch in the case of an audit. Without a separate business account in an audit, every personal expenditure could be reviewed and have to be accounted for. Very tedious.

Answer 2

First, if you are doing business using something other than your name, you have to file a dba (doing business as) certificate, usually in town or city hall, but every state is a little different.

If your business name is unique, at least in your area, you should be able to open an account in the business name with you as the owner. Even if not allowed by your state rules, you should be able to endorse a check made out to the business in the business name and endorse it with your real name underneath. For safety, you may prefer to have the business endorsement read "Pay to the order of [your name]" and then endorse the business name.

You should check with your bank or several banks before you do this to make sure it's set up correctly. I recommend you do not use the same bank for your personal account and the business account. If you just use one account for business and personal use, that's OK, but if the business grows, you may want to consider putting the business into a separate legal entity. The major concern is not taxes, but personal liability and payroll benefits.

Answer 3

There are ways to do it, but I would recommend against it. In my experience, you always want to keep accounts seperate. That is particularly handy at tax time.

If you business is listed as a "fictious business name" you should be able to take that paper into the bank, see a customer service agent to have it set up so you can cash a checks at a teller.

I would consult a tax person first, but that is up to you.

Answer 4

You are most likely going to have to open a business account.

Most banks require either a business account or a copy of your Assumed Business Name filing from the state you live in in order to transact business under any business name. If you open a business account you will have to have documentation, such as the Assumed Business Name filing and Tax ID number for starters.

Check with your bank about what kinds of business accounts they offer and what kind of documentation they need to open one for you. Some banks have Free business checking accounts and also Business savings accounts.

Answer 5

As far as I know you cannot cash a check made out to a business (even if it is your business) or even deposit it into a personal account. The best thing to do would be to open a business account to deposit the checks into. You can then make withdrawls from the account.

Answer 6

Yes there is a way...you sign the check (It becomes bearer paper & Do not lose this check after you sign it), then you make indication that it will be forwarded to your personal account... ASk your banker from your regular bank, what their specific instructions are...you can sign a check under your business name and give it to anyone as a sort of IOU...check with your bank about their deposit instructions.

Answer 7

Have you spoken with your bank yet?

Answer 8

see your local banker