Business Checking Account?

[Kim]

For the past 4 years in business I have used my (shared account with husband) personal checking account for my business. I'm a family provider, sole proprietor, have an EIN, and don't HAVE to have a business checking account but I would like for my clients to be able to pay me electronically rather than write a paper check each week. I've already researched my bank as far as fees and they offer a free checking account for small businesses that would suit me perfectly with no fees for the level I am at.

Just wondering if it's worth the hassle for me to open a small business account and what all it involves?

If you have a separate account how do you use it? Do you pay yourself? I will certainly use it to pay 100% business expenses like equipment, art supplies, etc. Can I also use it to pay part business/part personal expenses like cable, electric, trash removal, etc? What are the implications at tax time?

[Blackcat31]

I have a separate checking account for my child care but it isn't a small businsess account as the fees and stuff work very different at our bank for that. (Our bank requires me to have a state registered business name and certifcate inorder to have a small busines account.)

So I just choose to use another local bank and open a checking account that simply has my own personal name on it. I use the account for parents to pay me and I also use it to pay the bills associated with child care. I don't pay myself from this account but more or less only deposit the amount of money I need to pay a specific bill...kwim?

I also do this because in the past I had a parent write me an NSF check that when it bounced caused all my personal bills and payments to also be nsf and I will NEVER let that happen again.

So basically, I use the separate account tocash parent checks and deposit funds to pay bills and other than that the account sits with a minimum balance in it.

As far as tax time goes, I have never had any issues or special things that need to be done that so I don't think that is something to worry about.

[jojosmommy]

I have a business only account. All my parents pay through childcarepay.com and all the money goes into my business account. Then I fundtransfer (or "Pay" myself) money into my personal account. I pay all my bills that are daycare only from my business account- like my relicensing fees. I pay all our shared bills from my personal account. It is my understanding that what you do with your money is your own thing and has nothing to do with taxes. If you can track what is 100%, what is time spaced or shared then it doesn't matter what account it comes from. I just find it easier to do the 100% business from my business account and the rest personal so I know where to look if something goes crazy.

My bank doesn't charge to have a business account.

[Abigail]

This is my first year doing business but I opened a separate checking account at a different bank mainly because of privacy. You never know who comes into your home and can get your bank information for an automatic deposit for daycare or something or even if they overpay a day or get a deposit back I didn't want someone having our only checking account numbers. So privacy was my number one concern. Our personal checking is at another bank and we need enough money in their to pay a big mortgage every month and if someone got ahold of that account we'd be in trouble!

I was going to use it to easily track expenses and income, but that's not working so well. I opened the account two months after starting my business so the first 6 weeks or so isn't included. Then I accidentally deposited a check a friend gave me for $20 which was no daycare income. I do pay myself regularly and buy 100% daycare items with it. I hope to be better organized next year! Soon I'll have to start creating a document to track things in.