Opening a business bank account is a simple four step process that can typically be completed in less than an hour, if you have prepared beforehand. You can open a business bank account either online or in-person, but doing so online will typically take longer and could require additional documentation. 

Before you open a business bank account you’ll need to provide an employer federal tax identification (FEIN or EIN) and your legal registration documentation. If you haven’t yet incorporated your business, MyCompanyWorks can do this for you with a simple three step process that only takes you a few minutes to order online.

You can open your business bank account by following these four steps: 

Step 1 – Determine What You Need in a Business Bank Account

There are many things you should consider before you move forward with opening a business bank account. First of all, what type of bank account do you need? While most businesses start with a business checking account, a savings account might also be a consideration if your situation dictates. The fees your bank will charge should also be a strong consideration on which type of account is right for you. 

The most common types of business bank accounts are: 

• Business Checking Account: This is an account you can freely move money in and out of as your business needs occur. If you have lots of transactions that you need to make with deposits and bill payments then this is the account that is most likely right for you. This is also the most common type of business bank account.
  
• Business Savings Account: This is an account that you can make deposits to where you’ll earn extra money every month for keeping it in your account. You’ll be limited on the number of withdrawals you can make though, so this is only for businesses not looking to make frequent payments out of the account.
  
• Free Business Checking Account: This type of account operates just like a normal checking account but there are no maintenance fees and may not have a minimum account balance requirement. These accounts are typically online business checking accounts so it is right for newer businesses that don’t need a physical branch nearby.

Once you’ve determined the account that you need then you should determine how much you’re willing to pay every month for maintenance and security. Having a physical branch nearby is important for businesses that take on a lot of cash that needs to be deposited on a consistent basis. If you just need a business checking account to sign up for affiliate programs for your online business or to get your business off the ground then an online free checking account may suffice. 

Step 2 – Find the Right Bank for Your Business

Now that you know the type of account you’re looking for, you can narrow down which bank you’d like to work with. Oddly enough, the bank choice is made by proximity more than anything else for the majority of small businesses. Most businesses just want a bank with a name they can trust that is close to their base of operations. This makes transactions easy in the event the business owner has to go into the bank. 

While many business owners are satisfied with proximity, you probably should consider other things when choosing the right bank to partner with. There are a number of factors that should be considered when picking the bank, such as the banking fees and other costs. The factors we recommend include: 

• Bank Network: How convenient is the bank’s network to your operations? Are there plenty of free to use ATMs and deposit locations that meet the needs of your business? This is especially important to investigate if you’re opening a business bank account with an online provider without close proximity to a branch location because you need to know where you can withdraw funds from without paying a fee.
  
• Online Experience: How easy is it to transact business using an online website or phone app? Considering how much business is transacted online these days, this should be an absolute must that meets the demand level of your business needs.
  
• Costs: How much are the fees? Are you going to be paying a maintenance or security fee, and if so how much do you pay? Do your fees increase if your balance dips below a certain amount? These are all important things you should ask before signing on the dotted line and making your first deposit.
  
• Integrations: Small businesses typically use an accounting software like Quickbooks. Your bank should make your life easier, not more difficult. So, you should make sure that whatever accounting software you need, it integrates with your bank. If it doesn’t then you, or your accountant, will likely regret it later.

Once you’ve taken these things into consideration, and all other important aspects of the banking relationship that is important to you, then you’ll be ready to make a decision. Remember, the right bank doesn’t need to have a big name to be the right partner for you. For example, many credit unions and online banks have been great partners for businesses of all sizes. 

Step 3 – Gather the Right Documentation

Before you open a business bank account you’ll need to make sure that you’ve correctly incorporated your business. The bank will ask for your corporate documents before you’re able to make your first deposit. Having the right documentation with you at the time of application will speed up the entire process, and enable you to walk away with a business bank account the same day you apply, in many cases. 

The documentation that you’ll need to gather could include (call the bank before you visit to make sure you have it all): 

• Employer Identification Number (EIN)
• Social Security Number (if you’re an unincorporated sole proprietorship)
• Business Licenses
• Business Name Filing Document (if applicable)
• Partnership Agreement (if applicable)
• Articles of Incorporation or Organization (and appropriate banking resolution)
• Explanation of Your Business
• Funds to Deposit
• Some online banks may require more documentation to verify your identity

You can obtain most of this by incorporating your business ahead of time. MyCompanyWorks has been trusted to complete more than 60,000 business formations and counting. In just three easy steps you can be on your way to receiving all of your documentation so that you can immediately open a business bank account. 

Step 4 – Deposit Funds With Your Bank

Once all of your documentation is verified, the bank will process your application and open your account. To finalize the account opening process you’ll be required to deposit funds into your new business bank account. Many banks will not require a certain deposit amount while others will require up to $1,000 as the minimum opening deposit even if they don’t require a minimum balance during the life of the account. It’s important to check with your bank before going through the process so you’re prepared to finalize this portion of the process. 

Once your funds are confirmed into your account then you’ll be able to immediately access them through the checks that your bank will provide. Some banks will immediately provide a debit card while others will send them in the mail within 7-10 business days. The length of time it takes for your funds to show up in the account will depend on the bank you choose and the method you choose to deposit your funds with. For example, cash will be available a lot faster than a wire transfer from another bank (even if it’s your personal bank). 

Benefits of Opening a Business Bank Account

There are many benefits for both you, as a business owner, and for your business when you open a business bank account. The most important one is that you should always keep your personal and business funds separated. This can protect you from personal liability in the event that something goes wrong in your business. For example, if your business files for bankruptcy in the future then mixing your personal funds with your business funds could put your personal assets at risk and attainable by the business’s creditors.

Other than the legal ramifications of opening a business bank account, you can also benefit from being able to easily pay your business’s bills and making it easy to pay your employees. It keeps your money safe and allows you to start building a banking relationship that you could utilize for needed loans to grow your business in the future. 

Getting Started

If you’re ready to take advantage of the benefits of having a business bank account, you can get started today by registering your business. MyCompanyWorks will do this for you and you can get started immediately with our simple three step process. All you have to do is select a company type and your state, fill out a quick online form, and then you’ll receive the needed documents to open a business bank account. 

Accounting is one of the most crucial functions of a business, but today’s entrepreneur needn’t worry. Numerous accounting software programs are available to help manage the financial transactions of your business, with programs ranging from basic accounting to total management of your company finances (also known as Enterprise Resource Planning or “ERP”). The use of accounting software enables companies to utilize the resources in their departments effectively, diminish costly accounting mistakes and improve operational efficiency.

NolaPro

NolaPro is a customizable accounting solution developed by Noguska LLC. This software features order tracking, POS, inventory and more.

NolaPro features a module in which companies can monitor sales, develop customer profiles and incorporate employee tracking time and other management applications. Its accounting ledger includes double-entry accounting, a balance sheet, account summarizations and the capacity to produce profit and loss reports. NolaPro offers an accounting solution for companies that need to manage employees, vendors and customers.

In the payable module, companies can generate vendor bills, produce aging reports, monitor credit card purchases, as well as check the status of payments. This software is perfect for businesses in various industries including pharmaceuticals, architecture, hospitality and telecommunications.

Sage 50 Accounting

Sage 50 is an ideal accounting solution for small businesses with products such as invoicing and billing, software analytics, security reporting and inventory management.

Sage 50 incorporates built-in data checks that detect accounting mistakes as well as suspicious transactions. Its security and audit functions enable users to monitor who is editing and entering data or accessing certain functions. The software includes analytics and forecasting that can be exported into Microsoft Excel.

The inventory management platform of Sage 50 helps users monitor inventory based on qualifiers including size, style and color. The system tracks inventory and creates a purchase order particularly when levels are running low. Sage 50 gives industry solutions for various business sectors including accounting, manufacturing, distribution, and construction.

Sage Business Cloud Accounting

Sage Business Cloud provides modules that enable you to create invoices, manage quotes, handle and submit VAT and cash flow forecasting.

For the $40 Sage Business Cloud plan, you receive user-friendly modules to manage invoices, quotes, submit VAT online, cash flow forecasting, smart bank feeds, multiple currency support, reconciliation and project tracking. Comprehensive video tutorials and free unlimited 24/7 telephone and email support is included with your plan.

NetSuite Financials

Netsuite Financials is the number one cloud provider of Enterprise Resource Planning. It is also recognized as the most suitable financial management system for growing companies in need of group consolidation, tax compliance, and multiple language support.

NetSuite’s basic accounting software is specifically designed for mid-sized to large-sized companies with more than 50 employees.

Sage Intacct

Sage Intacct is another highly-recognized provider of cloud-based accounting. Its software applications are perfect for small and mid-sized businesses and can offer real-time operational and financial insights with the capacity to automate critical procedures.

Sage Intacct provides users with a wide range of accounting applications including accounts receivable, accounts payable, general ledger, order management, and cash management. It includes time and expense management, built-in reporting and dashboards, revenue management, multiple entity consolidation and project accounting.

This accounting software has the capacity to integrate with other business applications such as POS systems, CRM and payroll systems to give users the option over which applications they wish to leverage in their organization.

Cougar Mountain DENALI

Cougar Mountain software is an accounting solution that has the capacity to customize ten integrated modules. This software is ideal for small and mid-sized businesses and can be installed in the cloud or on premises. The major features of Cougar Mountain include internal controls, individual user rights, rental equipment tracking, customizable reports, audit trails and FASB and GAAP compliance.

Denali Business provides accounting functionalities such as data analysis auditing, reporting and multiple location inventory management. For non-profits, Denali Funds offers a grant, donation and overhead accounting solution.

Cougar Mountain Denali Business solution provides business assistance particularly in controlling and monitoring the flow of business resources. Moreover, it allows businesses to manage multiple invoices, collection status and client information. Other features include bank reconciliation, purchase orders and a payroll system.

Deskera ERP

Deskera ERP is a comprehensive business management suite that automates distribution, billing, sales, purchasing, payment processing, product receipt, sales commission calculations, asset management, warehouse management, bank reconciliation, core accounting, sales tax compliance, financial reporting and multiple currency support including the ability to print checks.

Deskera ERP also offers built-in integration with other third-party solutions such as UPS, Orderful and AvaTax. It is customizable for user preferences, rules, alerts and automated workflows. Deskera ERP can be accessed from any browser independent of the operating system. It comes with an Android and IOS compatible mobile app. This software is perfect for small and mid-sized businesses.

Adaptive Insights

Adaptive Insights offers a web-based system for reporting, forecasting and budgeting. This software is useful for companies of all sizes. Adaptive Insights eliminates the need to buy new software or hardware. The interface is customized similar to Excel using familiarity to accelerate the training process.

Adaptive Insights assists the needs of various business types ranging from small and billion-dollar companies to non-profit organizations. The main features of the software are forecasting and budgeting, dashboards, reporting, financial modeling and administration.

Adaptive Insights serves the needs of healthcare, business services, non-profit organizations, software companies and manufacturing businesses. It has an extensive partner network in various nations. When you purchase this product, you gain access to training and support services as well as strong implementation.

Budget Maestro

Budget Maestro offers a comprehensive accounting solution capable of forecasting, budgeting, reporting and consolidating. Budget Maestro is perfect for industries such as healthcare, manufacturing, retail, non-profit organizations, business services and wholesale distribution. This software also offers a centralized database that updates any changes to a company’s data.

Budget Maestro has a calculation engine that ensures all computations are grounded on sound accounting principles. Budget Maestro has a “financial intelligence” that automatically builds the balance sheet off the profit and loss activities and automatically builds cash flow statement from the balance sheet.

Acumatica ERP

Acumatica ERP is a mobile-based and cloud-based enterprise resource planning solution, which allows a real-time view of the operations of your business. Together with its global network partners, Acumatica ERP offers a complete suite of integrated applications relevant to business management such as professional, financial accounting and distribution services.

The distribution management feature of Acumatica enables users to handle orders and quotes, automate purchasing, track inventory and enhance customer service. The program is completely integrated with manufacturing, CRM and financials as well as project accounting for transparency across the organization.

The project accounting feature of Acumatica offers solutions for timesheets, complex billing and budgeting as well as project inventory. It aids built-in accounting tools including accounts receivable, accounts payable, general ledger, purchase orders, sales orders, time and expense mobile applications and inventory management.

Wave

Wave is a cloud accounting software customized exclusively for small businesses. Compared to other free accounting software programs that restrict functions, Wave Financial provides a comprehensive accounting feature without monthly costs.

Wave Financial is free and is best used for service-based businesses. It is an ideal fit for freelancers, consultants, self-employed entrepreneurs and small businesses that have 10 or less employees.

Wave Financial allows you to make an account in just a few clicks by entering your email address and password. After completing the signup process, you can start customizing your account by completing your business type and company name.

Once you login, you will find a sidebar menu categorized into banking, accounting, sales, reports and purchases. Wave has a user-friendly interface that helps you run financial reports as well as perform basic accounting with great ease.

FreshBooks

FreshBooks is a convenient and easy-to-use accounting software. With just a few clicks, you can easily add billable time and expenses, establish recurring invoices, customize the appearance of the invoice and set up automatic payment reminders.

FreshBooks connects to your bank, tracks time, produces reports and assists you in managing projects. Like most other accounting software, FreshBooks provides various pricing plans, based on the number of clients you have. One distinguishing feature of FreshBooks is that it aids financial education for college students by giving free accounts. It also offers classroom materials to college students and educators.

Kashoo

Kashoo is an accounting software that is ideal for small business owners, freelancers and independent entrepreneurs to handle audits, taxes and other accounting functions. This software is accessible on mobile devices via an iOS app.

Kashoo enables users to operate in offline mode and synchronize data as soon as there is an established internet connection. It aids accountants in creating and sending invoices through the use of customizable templates. Users can track expenses by attaching images of receipts and can also file expenditures under the appropriate account to make it accessible during tax filings.

Kashoo allows users to automate bank reconciliation by synchronizing data with banks all over the world. It enables business owners to create financial reports, accounts receivable, profit and loss statements balance sheets and more. The solution also provides a dashboard that enables users to forecast data based on current figures.

Zoho Books

Zoho Books is an accounting software that provides the basic features every micro business needs. It also offers advanced tools as well as integration so that the company can continue using the software even as it grows. Zoho Books has low pricing in comparison to competing accounting software. Their basic plan only costs $9 per month while the professional plan is $29 per month and supports 10 users.

Zoho Books is an easy-to-use application with simple and fast account set-up. You simply need to enter your business name, password, contact and payment information.

Zoho Books enables you to save time through workflow automation. Use the software to perform automatic tasks such as securing payment reminders and invoices, tracking expenditures and sending notifications when your bills are due for payment. You can also convert sales orders and perform invoice estimation with just a few clicks. Zoho Books enables you to track the time and has a project management tool feature, which allows you to bill based on task hours, staff hours and project hours at a fixed cost.

Quickbooks

Intuit Quickbooks is an accounting software application perfect for small to medium-sized businesses. Quickbooks provides functionality to handle multiple locations, users, large quantities of transaction data or inventory workflows.

Intuit Quickbooks offers customized reporting tools that aid users in data analysis and making informed business decisions. This software application integrates with Excel to expand its reporting capacity. Quickbooks provides tools for scanning and attaching documents such as quotes and receipts. This solution allows businesses to arrange documents into categories and monitor significant accounting files. It maintains a change log to document changes within each report with a proper timestamp and date. The program also allows organizations to monitor employee information and secure regulatory compliance.

KashFlow

KashFlow is one of the easiest accounting software applications to use. It helps in importing data from Excel, Sage and Quickbooks. KashFlow’s interface is direct and it has various templates and invoices that you can use right away.

This application has lots of functionalities that encompass all the major needs you would expect. You can handle supplier and customer details, automate purchases and records, automatically import bank transactions and have the system notify you of late payments.

AccountEdge Pro

AccountEdge is an accounting and management solution that works with both Windows and Mac operating systems. This software application is ideal for small businesses and aids users in creating and tracking sales as well as purchases, running payroll, monitoring and creating inventory and managing time.

The major features of AccountEdge are banking, payroll, invoicing, purchase orders, inventory, time billing and e-commerce. Users can manage orders, quotes and invoices for time, services and items sold. Payments are processed on invoices and orders.

AccountEdge’s banking tools allow users to send and receive money, prepare deposits and electronic payments, print checks and reconcile accounts. Its purchase orders feature allows users create and track purchase orders and bills. AccountEdge also enables users to create an e-commerce platform, allowing them to sell items online.

The new tax law, called the “Tax Cut and Jobs Act” (TCJA), was signed into law on December 22, 2017 and is the largest overhaul of the US tax system since 1986. The bill is huge, and actually, in our opinion, makes many aspects of the tax code more complex rather than simpler. Some of the details are not entirely clear yet so we’re still learning more each day as the IRS implements various rules and decisions.

However, there is some very good news for small businesses (under a certain income and of a certain type of business activity) and any business that operates as a C-Corporation.

Continue reading “How the New 2018 Tax Law affects Small Business Owners”

Did you know that TurboTax now allows you to not only do your personal tax return, but they also do Single-member LLC’s, Multiple-member LLC’s, S-Corporations and C-Corporations?

SmartBiz.com has an article posted with 7 Tax Tips for Small Business:

Small Businesses have an especially hard time when it comes to taxes. Here are seven tips that will help keep you focused and could help save you money.

All MyNewCompany.com clients have access to the “My Account” section of our site, which contains “The New Corporation Handbook” or “The New LLC Handbook”. As well as telling you everything you need to know about properly running and maintaining your new company, the Handbook contains a section on taxes your new company will have to pay, including due dates. Clients who select our Entrepreneur or Complete Package also receive our MyCompanyForms CD which includes all your federal tax forms and a tax calendar, as well as over 200 sample business forms. Clients who did not order the CD as part of their Formation Service can always order a copy of the CD for only $35!