4 Reasons Why You Should Have a Business Bank Account 

Small-business owners have a lot to keep up with – finding and retaining customers, delivering goods or services, marketing and — of course — finances. The last item is most critical because there's no business without money. So, wouldn't it be wise to make dealing with your business' most crucial asset as simple as possible?

Creating a dedicated business bank account is one the best ways to simplify your company's finances. Keeping your personal and business funds separate will help you stay organized and make it easier to manage your business.

That's just the beginning. Here are four more reasons to open a separate bank account for your small business.

Tax time will be easier to handle
It's easier to manage just one bank account, but that convenience will be short-lived when you have to organize your tax information, according to accounting software company FreshBooks. Think of how time-consuming it will be combing through your bank account to separate your personal expenses from your business ones. That's time you could be focusing on your business. Keeping just one bank account also leaves you vulnerable financially. You might overlook business deductions that could help you save on your tax bill. You also risk missing income that should have been reported, putting you on the IRS' radar.

You will look more professional
How you conduct yourself professionally is a reflection on your business, including how you handle your finances. Requesting check payments be made to your company name rather than your name says a lot about your level of professionalism, according to financial information website Money Under 30. The same goes for when you write a check – your operation will be more legitimized if your checks have your company's name on them.

You can gain liability protection
You can register your business as a limited liability company (LLC) or corporation to help protect yourself from personal liability in the event there's a work-related mishap and you face legal action. That liability protection is not as strong if your personal and business funds reside in one account however, according to Forbes. If your business cash is in your personal bank account, all of your assets are exposed because your company won't look like it's a separate enterprise.

You will have enhanced purchasing power
Business bank accounts come with some benefits that personal ones might not. For example, you establish a business credit card account that will allow you to make larger startup purchases if necessary, according to the U.S. Small Business Administration. Additionally, you might be able to secure a line of credit, which could be helpful if you have a financial emergency.

From the customers' side, business bank accounts typically offer merchant services, which lets customers pay you by debit or credit card. That's a lot faster than waiting for a check!

A separate bank account is just one thing your small business needs. It's also always good to have reliable legal representation in place. Contact the Law Offices of Donald W. Hudspeth, P.C. to learn more about how to take the proper steps to ensure your business' financial well-being.

Categorised in: Starting a Business in Arizona

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