LLC Business Bank Account: What Are the Benefits of Opening One?
LLC business bank accounts are only for big companies raking in millions each year, right? Think again! Did you know you can reap the benefits of an LLC business bank account even as a small business owner?
An LLC business bank account has many benefits. These include tax savings and protection from creditors.
Curious to learn about how opening an LLC business bank account will help you? Read on to learn everything that you need to know on the subject.
Bookkeeping And Tax Benefits
One benefit of opening an LLC business bank account is the ability to save on taxes. You may also be able to report business income and expenses on your business tax return. This is beneficial since you will not need to pay self-employment taxes on income.
A business bank account can also make tax filing simpler. You track all income and expenses related to your business in one place. This makes it easier to file your taxes each year.
When you open an LLC business bank account, preparing paperwork is much quicker. You won’t have to sift through personal transactions to file financial documents.
Open An LLC Business Bank Account For Legal Protection
Opening a bank account for your LLC provides some protection against personal liability. The funds in your LLC business bank account are protected from creditors.
Legally, the funds in your business account are assets of your LLC. That is, they do not belong to you, the individual owner.
This comes in handy if someone sues your company. You won’t be personally responsible for the costs.
Make A Good Impression On Clients and Customers
When you send an invoice, your business account shows your professionalism. Customers will respect that you took the extra step to open a separate account. Plus it shows them that your business is doing well enough to warrant a business account.
An LLC business bank account makes compliance with complex financial rules much easier. For example, say your business has stopped doing business. If you still have money in the bank, you have to follow a specific set of rules to close the LLC.
These rules are outlined on the IRS website. Check with your tax advisor as the rules vary depending on the state.
Get Funding From Banks
When you apply for a loan, the bank usually expects all business accounts to be in the name of the LLC.
This is because it shows them that you are legally registered. It also makes it easier for them to track your business operations in future audits.
An LLC Business Bank Account Benefits Your Small Business
Opening a bank account for your LLC will have a big impact on maintaining your business. An LLC business bank account will help you with taxes and bookkeeping.
But as you now know, there are other benefits too! You’ll find that an account impresses clients or customers. You’ll get easier access to loans, and more.
Interested in learning more? Be sure to check out our other helpful articles on business and finance on the site.