What a small organization needs to open a checking account

A small organization can open a business checking account at most banks and credit unions, but you will need to bring proof of what your organization is and who runs it. The exact documents depend on whether you are a sole proprietorship, partnership, LLC, nonprofit, or corporation — each has a different legal structure and different paperwork requirements.

Banks do not treat a business checking account the same way they treat a personal account. You cannot open one with just an ID and a handshake. The bank needs to verify that your organization actually exists as a legal entity, that you have the authority to open an account on its behalf, and that the organization has a tax identification number (either an EIN or your personal Social Security number if you are a sole proprietor).

The process usually takes one to three business days if you bring everything in person, or up to two weeks if you apply online. Some banks will let you start using the account before the debit card arrives, but others require you to wait.

Key Takeaways

  • You will need your organization's legal structure documents (articles of incorporation, LLC formation papers, or partnership agreement) and a tax identification number before any bank will open an account.
  • A sole proprietorship can open a business checking account using your personal Social Security number and a DBA (doing business as) certificate if your state requires one.
  • Nonprofits need their 501(c)(3) information letter from the IRS, articles of incorporation, and proof of board appointment for whoever is signing the account agreement.
  • Banks will ask for a government-issued ID for the person opening the account and may ask for personal financial information even though the account belongs to the organization.
  • Credit unions often have lower fees and simpler requirements than banks, especially for very small organizations.

Documents you need by organization type

Sole proprietorships have the simplest path. Bring your personal ID, your Social Security number, and proof that you are doing business under a specific name. Some states require you to file a DBA (doing business as) certificate with the county clerk; others do not. Call your county clerk's office or check your state's Secretary of State website to find out. If your state requires a DBA, you will need a copy of the filed certificate. If it does not, you can usually open an account with just your ID and Social Security number, though some banks ask for a business license anyway.

Partnerships need the partnership agreement (signed by all partners), a copy of the EIN assignment letter from the IRS, and government-issued ID for at least one partner. Some banks require ID from all partners. The partnership agreement should name who has authority to open and manage the account.

LLCs need the articles of organization (filed with your state), an EIN assignment letter from the IRS, and a government-issued ID for the person opening the account. If your LLC has an operating agreement that names specific members with signing authority, bring that too — banks sometimes ask for it.

Corporations need the articles of incorporation (filed with your state), corporate bylaws, a corporate resolution authorizing the account opening (signed by the board or whoever has authority), an EIN assignment letter, and ID for the person signing. The corporate resolution is a one-page document stating that the board has authorized this specific person to open and manage the account.

Nonprofits need the articles of incorporation, the 501(c)(3) information letter from the IRS (or a copy of the application if you are still waiting for approval), bylaws, a board resolution authorizing the account, and ID for the authorized signer. Some banks also ask for a list of board members and their titles.

Where to get an EIN if you do not have one

An EIN (Employer Identification Number) is a nine-digit tax ID issued by the IRS. Most organizations need one to open a business checking account, even if they have no employees. You can get one free from the IRS.

The fastest way is to apply online at the IRS website (irs.gov). Go to the EIN section and use their online application tool. You will get your EIN immediately after you submit, and you can print a confirmation letter right away. This takes about 15 minutes.

If you cannot apply online, you can call the IRS at 1-800-829-4933 and request an EIN over the phone. They will issue it on the spot and mail you a confirmation letter. You can then take that number to the bank immediately.

If you are a sole proprietor, you can use your personal Social Security number instead of an EIN, though many banks prefer an EIN anyway. Nonprofits and corporations must have an EIN.

What to bring to the bank in person

Bring your organization's formation documents (articles of incorporation, LLC papers, partnership agreement, or DBA certificate), your EIN assignment letter or confirmation, and a government-issued photo ID. Bring the original documents or certified copies — banks will not accept photocopies of formation documents.

If you are opening the account as an authorized representative rather than as the owner, bring a board resolution or written authorization from the owner stating that you have the right to open and manage the account. For nonprofits, this is usually a board resolution. For corporations, it is a corporate resolution. For LLCs and partnerships, a simple signed letter from the owners often works, though some banks ask for more formal documentation.

Bring a recent utility bill or lease in your organization's name if you have one — banks use this to verify your business address. If your organization is brand new and does not have a utility bill yet, bring a lease, a signed contract with a client, or a letter from your landlord confirming your address.

Ask the bank ahead of time whether they need anything else. Some banks ask for personal financial information about the owner or authorized signers, especially if the organization is new or has no credit history.

Opening an account online versus in person

Most banks let you start the application online, but they will still need to verify your documents. If you apply online, you will usually upload photos of your formation documents, EIN letter, and ID. The bank will review these and may ask you to come in person to verify them, or they may mail you a form to sign and return.

Online applications take longer — usually one to two weeks — because the bank has to manually review your documents. In-person applications are faster because the bank can verify everything on the spot and you can start using the account within one to three business days.

Credit unions often have simpler online processes than banks and may approve you faster if your organization is small and local. Some credit unions will open an account for a small organization with just an EIN and a government ID, without requiring all the formation documents that banks ask for.

Fees and account features to compare

Business checking accounts have different fee structures than personal accounts. Most banks charge a monthly maintenance fee (ranging from $0 to $30 depending on the bank), fees for each check you write, fees for wire transfers, and fees if you fall below a minimum balance.

Some banks waive the monthly fee if you maintain a minimum balance (often $500 to $2,500) or if you set up direct deposit. Others charge per-transaction fees — for example, $0.25 per check or $15 per wire transfer. A few banks offer free business checking with no minimum balance, though these are less common.

Credit unions typically have lower fees than banks and may not charge a monthly maintenance fee at all. However, credit unions are membership organizations, so you may need to join before you can open an account. Membership is usually free or costs $5 to $25 one time.

Before you choose a bank or credit union, ask about fees for the services you actually use. If you write a lot of checks, per-check fees add up fast. If you make frequent wire transfers, ask about wire transfer fees. If you plan to deposit checks by phone or mail, ask whether they charge for remote deposit.

What happens after you open the account

Once the account is open, the bank will issue you checks and a debit card. You can usually start using the account for electronic transfers (ACH transfers, wire transfers, bill pay) within one business day, but checks and the debit card may take five to ten business days to arrive.

Some banks let you order checks directly from them; others let you order from a third-party check printer. Third-party printers are usually cheaper but take longer. Ask the bank what your options are.

You will receive monthly statements showing all deposits and withdrawals. Keep these for your records and for tax purposes. If your organization has employees or makes tax payments, you will need to keep detailed records of all business transactions.

Frequently Asked Questions

Can I open a business checking account if my organization is not registered yet?

No. The bank needs proof that your organization exists as a legal entity. You must file your formation documents (articles of incorporation, LLC papers, DBA certificate, or partnership agreement) with your state before you can open an account. This usually takes one to two weeks after you file.

Do I need an EIN if I am a sole proprietor?

No, you can use your personal Social Security number instead. However, many banks prefer an EIN because it keeps your personal and business finances separate on their records. Getting an EIN is free and takes 15 minutes online, so most sole proprietors get one anyway.

What if I do not have a physical office address yet?

You can use your home address, a mailbox at a UPS store or mailbox rental service, or a coworking space address. The bank needs a verifiable address for your organization. If you use a mailbox service, bring the rental agreement as proof of the address.

Can someone other than the owner open the account?

Yes, but you need written authorization. Bring a board resolution (for nonprofits and corporations), a partnership agreement (for partnerships), or a signed letter from the owner stating that this person has authority to open and manage the account. The bank will verify the signature and may call the owner to confirm.

How long does it take to start using the account after I open it?

You can usually make electronic transfers (ACH, wire transfers, bill pay) within one business day. Checks and debit cards take five to ten business days to arrive. Some banks let you request expedited card delivery for an extra fee.