Do You Need a Business Bank Account for LLC? Key Considerations

For many who go into business, it can feel as if there are countless steps involved from registration to bookkeeping.

If you run an LLC, you might have wondered whether you need a separate business bank account, or if it would be beneficial in some way. In this blog post, you’ll learn whether it’s a legal requirement, what the pros and cons are, and how to open a business account for an LLC.

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Do I Need a Business Bank Account For My LLC? Banking Requirements Explained

As the owner of an LLC, you’re under no legal obligation to open a separate business bank account.

Technically, you can use a personal bank account in your LLC, but it’s ill-advised to do so. If you use a personal account, it’s a lot more difficult to file taxes and could lead to serious complications down the line.

While there may be no legal imperative, though, accountants and financial experts strongly recommend that you set up a business account.

Some banks and providers also have rules against using personal accounts for business use, so you have to get a business account in this case.

Wise Business, for example, offers a personal and business account, but using the personal account for business transactions is against the terms of use. Wise is not a bank, but a Money Services Business (MSB) provider and a smart alternative to banks. If you have an LLC, you can easily open a Wise Business account online to send, receive, and manage business payments. You’ll also get a host of free tools that make life easier, which you won’t get with a personal account.

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Benefits of Having a Business Bank Account for LLC

There are many reasons why it’s a wise move to set up a business bank account when you operate an LLC. It’s not just about convenience—it’s about protecting your business and finances. It also helps streamline operations and position your company for growth.

Simplify bookkeeping

One of the biggest headaches for many small business owners is tracking income and expenses.

With a business bank account, you can clearly separate your finances.

That way, you can:

• Keep your personal and business finances separate making it easier to track transactions
• Avoid costly mistakes during tax season by having clearly laid out finances
• Save money on accounting fees by cutting down on the amount of work they’ll need to do to sift through your accounts
• Maintain clean financial records which is important if the IRS decides to audit your business one day

Uphold a professional image

A business bank account can also help you uphold a professional image in your business.

You’re not a sole proprietor or freelancer when you run an LLC - even if you started out as one. Setting up a business account makes you look more legitimate and clients are more likely to take you seriously when they see you have one.

Some vendors and suppliers will require that you have a business bank account in order to make payments.

Protect your personal finances

From a legal standpoint, setting up a business bank account can help protect your personal assets as the owner. This is one of the main reasons many people choose to set up an LLC in the first place. This way a business holds liability if another party seeks financial compensation.

If you only have a personal bank account, you would effectively be liable for business debts and lawsuits, which is a compromising position to be in. It means your personal assets such as your home, personal savings, and investments could be on the line if you ever find yourself in a legal battle.

Streamline transactions

On a daily operations level, a business bank account makes it much easier to make and receive payments.

Most payment processors such as Stripe and Square require a business bank account to complete professional transactions.

Having a separate business account makes it easier to track expenses, payroll, and recurring payments.

Plus, you might qualify for business credit cards which you can use for company-related expenses and to build up business credit.

Steps to Open a Business Bank Account for LLC

Opening a business bank account for your LLC should be a straightforward process.

Here’s a step by step guide to what you need to open a business bank account for an LLC:

Step 1 - Decide Which Bank Is Best For Your Llc

When you open a business bank account, you want to make sure you choose the right bank as some will be much better suited to your specific needs.

Consider the following factors when looking for a bank:

• Fees (minimum deposit, monthly maintenance, transfers)
• Type of bank (brick-and-mortar or online-only)
• Limits around transactions
• Rates for international transactions in different currencies
• App integrations
• Sign-up bonuses

Step 2 - Gather the Necessary Documents

Once you’ve found a bank and a business account that suits your needs, the next step is to collect all the required paperwork to set up the account.

Requirements can vary from bank to bank, but here’s a list of documents you’ll typically need:

• LLC formation paperwork - This includes Articles of Organization or a Certificate of Formation
• Employer Identification Number (EIN) - Issued by the IRS for tax purposes
• Operating agreement - If your LLC has more than one member, this document outlines your ownership and management structure
• Business license - This will only be applicable based on the State and industry you’re in
• Personal ID - Any government-issued ID such as a passport or driver’s license

Step 3 - Start the Application Process

This step will largely depend on the bank you choose, and the process could take place in person or online.

Usually, during this phase, you will fill out an application form providing details and documents related to your business. If applicable, you may also need to deposit a minimum balance.

Finally, you’ll sign the legal paperwork.

For more information on the process of opening a business bank account for an LLC, please consult this comprehensive guide.

The Easy Way to Manage Your Business Finances

If you’re looking for a convenient business bank account for your LLC that you can set up online today, the Wise Business account might be your best bet.

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When you sign up for a Wise Business account you can enjoy:

• No monthly fees or minimum balance requirements
• International payments at the mid-market rate
• QuickBooksintegration to track bill payments
• Multiple currency management in one place
• The ability to receive payments like a local with major currency account details
• Hold more than 40+ currencies all in one account

	Editor & Business Expert:
	Panna is an expert in US business finance, covering topics from invoicing to international expansion. She creates guides and reviews to help businesses save time and make informed decisions. You can read more useful business articles on her author profile.

	Author:
	Sam is a UK-based copywriter with 4+ years of experience writing for SaaS and eCommerce brands. He creates comparison guides, informative blog posts, and covers other finance-based topics.