Michael Broida, CPA of Heller, Broida & Eisenberg Accountancy Corp. (www.HBEAC.com), discusses accounting for small businesses.
- Bank requirements: federal ID number, fictitious business name
- You may need to deposit a minimum amount before securing a loan
- A business account will help keep your financial records separate
- Services & offers can differ depending on the bank
- Establish a lasting relationship with your bank officer
Once you have your funding, you need to open a business bank account. The banks are going to require many things from you including a federal ID number. They may want a fictitious name that you do with your county. They may – you may want to form a corporation, various things that the bank is going to look for when you open the account.
They may require some minimum balances. You may not be able to borrow money immediately but again the bank is looking for future relationships and to grow with your business.
You want a business bank account because you want to keep your business separate from your personal life. It helps with the accounting. It helps with your taxes.
You might want to check with different banks of size, different sizes. Big banks offer certain services. The small banks don’t. If you need credit card services, the bigger banks are probably better able to serve you. You might get a better personal relationship with a smaller bank. Get to know your bank officer. Even though you may not be borrowing money now, you may be borrowing later.
So this is the establishment of a hopefully long term banking relationship.