How to open a business saving accounts

There are a number of benefits of opening a business savings account. Some of them are as follows:

  1. A business saving account makes transaction of money easy.
  2. It gives credibility to the business.
  3. A record of the transactions made through a business savings account helps in filing up taxes.
  4. Business money can be saved as well as interest can be earned. 

Things required before opening a business savings account

The first and the foremost thing that is required to open a business savings account are to have a valid business. Banks do not allow customers to open business savings accounts without proof. Valid and registered business proof needs to be shown to the bank officials. Certificate of business status, trade name registration, non profit paper work etc are some of the common proof that banks require as proof certificate for an established business.

Banks also require an employer identification number for opening a business savings account. It is akin to giving legitimacy to an individual’s business with a social security number. The employer identification number is needed by the bank to check interests earned by the business account to the IRS. This number is easy to get and can be availed free online. The basic eligibility to obtain this number is to own a business even though a solo proprietorship.

Finally, when opening a business saving accounts, the bank will undergo a credit check on the applicant. Since the transactions that take place in business savings accounts are usually of high end values therefore a good credit history is a must to open such accounts. Applicants with any past credit default need to make their credit papers straight before applying for business savings accounts.

Steps to open a savings account

After having arranged the appropriate papers, the applicant must look for banks that offer business savings accounts. Only large institutional banks are able to handle transaction of so much money from a single account.

The interest rates offered and the processing charges should be compared with other banks. This can be done through online.

The minimum balance required should also be taken in to account.

Choose a bank that offers a business account that meets the needs of the business.

Business savings accounts offer tax rebate up to a certain amount. Care should however be taken that a businessman does not use the account to stay away from excess of money. To prevent this, most of the banks allow only a certain limit of cash deposit in the account.

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