⏰ Estimated read time: 6 minutes
You need information about yourself and your business to open a business bank account. The exact business bank account requirements will depend on your business entity and which financial institution you choose. But the following checklist can give you a head start and prepare you for how to open a business bank account.
» MORE: NerdWallet’s picks for the best business checking accounts
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American Express National Bank (Business)
American Express® Business Checking
NerdWallet Rating
5.0
Checklist: What you need to open a business bank account
Personal information |
☐ Government-issued photo ID (some banks may ask for two). ☐ Home mailing address. ☐ Personal phone number. ☐ Personal email. ☐ Date of birth. ☐ Social Security number. |
Business information |
☐ Employer identification number (if you have one). ☐ Business name. ☐ Trade name or dba name (if applicable). ☐ Business address and phone number. ☐ Business entity type (sole proprietorship, partnership, LLC or corporation). ☐ Date your business was formed. ☐ Industry and type of business you operate. |
Business documentation |
☐ Sole proprietorships: Business name registration certificate, business license. ☐ LLCs: Articles of organization, LLC operating agreement, business license. ☐ Partnerships: Partnership agreement, business name registration certificate, business license, state certificate of partnership. ☐ Corporations: Articles of incorporation, corporate bylaws, business license. |
Requirements to open a business bank account
Specific business bank account requirements will vary from bank to bank, but most financial institutions require the following combination.
Personal information
Businesses owners typically need to include personal details and identification, including:
Government-issued photo identification. Typically a driver’s license or passport. Some banks may ask for two types of ID.
Home address. You need to have a U.S. mailing address to apply for most business accounts. Banks typically require a physical address rather than a P.O. Box.
Personal email and cell phone number. Financial institutions use this information for two-factor authentication. A handful of online business checking accounts are mobile only and require a cell phone number to apply for an account.
Date of birth and Social Security number. Banks use this information to verify your identity, which they are required by law to do.
» MORE: Can you open a business bank account with an EIN only?
🤓 Nerdy Tip
Businesses with multiple owners typically need to include personal details and identification for every owner with 25% or more ownership in the business.
Business details
Most business account applications will ask for basic business information, such as:
Employer identification number. You may also need to provide corresponding documents from the IRS. Sole proprietors and single-member LLCs may be able to open a business bank account without an EIN by providing their Social Security number instead.
Business name and trade name or “doing business as” name, if you have one. No official business name? You can use your own name.
Business address and phone number. You can use your home address if you don’t have an office or a storefront.
Business entity type. Sole proprietorship, partnership, corporation or LLC.
Date your business was formed. If your business is registered with the state, use that date. If not, use the date the company was founded.
Industry and type of business you operate. Certain types of business — such as gambling, cannabis and adult entertainment companies — cannot open a business account with most banks.
» MORE: Best business bank accounts for LLCs
Business documentation
The documents needed to open a business bank account depend on how your business is set up. Here are common requirements for different entity types:
Sole proprietorships. Business name registration certificate, business license.
Partnerships. Partnership agreement, business name registration certificate, business license, state certificate of partnership.
LLCs. Articles of organization, LLC operating agreement, business license.
Corporations. Articles of incorporation, corporate bylaws, business license.
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American Express® Business Checking Member FDIC | Bluevine Business Checking Deposits are FDIC Insured | Grasshopper Business Checking Account Member FDIC |
|---|---|---|
NerdWallet rating 5.0/5.0 | NerdWallet rating 4.7/5.0 | NerdWallet rating 4.5/5.0 |
Monthly fee $0 | Monthly fee $0 | Monthly fee $0 |
APY 1.30% With $0 min. balance for APY | APY 2.00% With $0 min. balance for APY | APY 2.25% With $0 min. balance for APY |
Bonus N/A | Bonus N/A | Bonus N/A |
Learn more at American Express National Bank | Learn more at Bluevine | Learn more at Grasshopper Bank |
Why open a business bank account?
Business bank accounts serve many functions beyond simple cash flow. Benefits of a business account include separating — and safeguarding — your assets and making it easier to manage invoices and tax deductions.
Streamline bookkeeping: Running all of your company’s income and expenses through a dedicated business account makes it easier for you to track outstanding invoices, generate financial statements and apply for business loans and grants.
Simplify tax preparation: Using a business bank account also makes it easier to file your taxes. You won’t need to untangle business and personal expenses — that’s already done for you. And many business checking accounts integrate with popular business accounting software, making it easy to categorize expenses and identify deductions. Some business checking accounts for freelancers also have built-in tax planning tools to help you estimate and file your self-employed taxes.
Protect personal assets: Your business’s legal structure — if you’re an LLC, partnership or corporation — can shield your personal assets in a lawsuit. But mixing business and personal assets can jeopardize that protection. Using a business bank account for company transactions helps preserve the legal distinction between you and your business.
What to look for when opening a business bank account
There is no one-size-fits-all business bank account. If you're opening a business bank account for an LLC, for instance, you might want different things than a sole proprietor would (like more than one debit card).
Focus on the features and services that fit how you do business. Consider the following:
Fees. A free business checking account is ideal. If you’re considering an account with a monthly fee, do the math to make sure you can usually hit the balance requirements to avoid it. Check out the account’s fees for things like ATM use, wire transfers and overdrafts, too.
Transaction limits. Brick-and-mortar banks typically place a monthly cap on how many transactions you can make per month without a fee. All business bank accounts may cap cash deposits and withdrawals, mobile deposits and other types of transactions. Read the fine print to make sure an account’s limits won’t hinder your business.
Attainable perks. Scrutinize the flashy perks marketed by business banks to ensure you’ll actually benefit from them. A business bank account that boasts a sky-high annual percentage yield (APY) is great — unless you need a $1 million minimum balance to start earning interest. Likewise, banks like Grasshopper Bank and LendingClub offer cash back on all debit card purchases, but some others only offer cash back on spending with select merchants.
Branch access. Many business banks are online-only, which means you’ll never visit a branch. If you prefer to be able to talk to a banker in person, look for brick-and-mortar banks with plenty of branches at ATMs in your region.
