i have started a business that is 40% operating. is it a good idea to use my personal bank account for the business or should i get a seperate biz account. a biz account with b.o.a cost 16 bucks a month to keep if i don't keep a balance of 3500. i am not making a profit yet. i do not have a biz loan or grant yet. what are the tax probs with using my personal checking account. thanks to all. please support our military vets.
#1. "RE: business bank account." In response to Reply # 0
You should always separate the accounts. For one, book keeping will be so much easier. For two, it's better organization and three, simply separating the two allows for a seperation of business and personal. Although that sounds simple and repetetive, it's a principle quite often overlooked and causes for complications in the long run.
The expense on the business checking is just that, it's an expense and it helps lower your taxes. Without seperating the two, how do you write off your expenses of a checking account if you use it for personal as well. You can't without a fight. So simply seperate the two, mark it down as an expense and move on without the headache and hassle. Your accountant will appreciate you for that, (that is when you get one).
#2. "RE: business bank account." In response to Reply # 1
thedesighnshop you are wise and i will follow your advice. i ask you though is it wise to just have another personal account opened in my name and just use that as my business account. that way i can avoid paying the monthly maintness fee. what are your ideas. thanks again..........kevin please support our military vets
#3. "RE: business bank account." In response to Reply # 2
Not a good idea to have a personal account in your name for your business. The IRS may look at your "business" as a hobby. I don't understand why the maint fees are so high? Try another bank. You will need a DBA certificate. So be sure to register your business name locally (it's quick and painless and doesn't cost much at all).
#4. "RE: business bank account." In response to Reply # 3
thank you oh wise one. i will take heed to your advice. another question is. i am using my personal car as a business car. should i have my car re-registered in the business name or is it o.k to leave it registered under my name. will insurance be higher if registered under biz name. thanks so much.........kevin please support our military vets.