How to open an LLC bank account

If you do your homework and bring the necessary documents, opening an LLC bank account shouldn’t be too difficult.

You’ll need to open a business bank account in the name of your limited liability company (LLC), whether it’s to accept a customer cheque or pay for a business expense.

It could seem like a hassle, particularly in the early stages of operating your business when things are busy and you’re juggling all the additional demands a new firm place on you, but it is vital.

By forming an LLC, you’ve created a separate business entity that gives you limited liability protection. Because your business is a separate entity from you, you must keep your business finances separate from your personal finances. While it may be tempting to mix your business and personal funds, doing so jeopardizes your limited liability protection.

Aside from the legal requirement of maintaining a separate bank account for your limited liability company, there are also practical reasons to do so.

You will have an easier time calculating your tax liability. And if you hire an accountant, you won’t have to pay for your accountant to separate your business and personal expenses.
If you pay with a check in your company’s name, you’ll project far more professionalism and gain far more respect and trust from vendors and suppliers.
You’ll build a relationship with your bank that will be useful if you ever need a business loan.

While opening an LLC bank account is not as simple as opening a personal bank account, it should not take too long if you do your research and bring the necessary paperwork to the bank.

Not all business bank accounts are the same. There are numerous bank account options available, and you will need to do some research to determine which account is best for your needs.

There will be various fee structures and service options available. You’ll also need to decide whether you want overdraft protection, the ability to write checks from your account, or a debit card to go along with your account. Will you require a single account or several? Will requiring a minimum balance work for you? What are the total monthly charges you can expect to pay? All of these questions will help you determine which type of bank account is best for your business.

What documentation does the bank need?

Once you have decided on the type of bank account you want to open, contact your bank to find out what documentation is required to open a business bank account for an LLC. Your bank will most likely require the following documents:

Depending on the state in which you registered your LLC, a copy of your articles of organization, certificate of formation, or an equivalent document.
The federal taxpayer identification number for your LLC (EIN, or Employer Identification Number)
Your LLC operating agreement or another document that specifies who is authorized to sign on your LLCs behalf.
Your bank may also have additional documentation requirements, so call ahead to avoid making a trip that is unnecessary.

Opening an LLC bank account

After you have gathered all of the necessary documentation, you can meet with your banker to open a bank account for your LLC. Doing your research ahead of time and bringing all of the necessary documentation will make this final step in the process much easier.

A separate business bank account is not only required for your LLC, but it will also assist you with many practical aspects of running your business, such as accounting for expenses, paying business bills, and depositing customer payments. Furthermore, using your bank account responsibly will help you build a stronger relationship with your bank, which will be especially useful if your LLC needs credit in the future.