Can You Open a Business Bank Account With an EIN Only? (2024)

Understanding the Role of EIN in Business Banking

An Employer Identification Number (EIN), also known as a Federal Tax Identification Number, identifies your business for tax purposes. The Internal Revenue Service (IRS) issues EINs, and most businesses are legally required to have one. If your business is a corporation or partnership and/or has employees, you’ll need an EIN. If you’re a sole proprietor, you can also get an EIN, but you may not need one. If you’re unsure, it’s best to contact the IRS and/or your state’s secretary department.

You’ll need an EIN to conduct the following:

• Open a deposit account (business checking account or business savings account)
• Pay taxes
• Comply with state and federal laws
• Get your business license from your state
• Qualify for business loans and other financing options.

It’s a good idea to get your EIN as soon as you start your business. Even if you don’t plan on having employees for a while, getting your EIN makes it easier to obtain the rest of your business’s documentation, file taxes and open a business bank account. Having your EIN also allows you to hire employees when you need them without delay. It will also help if you need other banking services like a line of credit, credit cards or a business loan.

Why Most Banks Require Additional Documentation

Although most banks and credit unions require an EIN to open a business checking account or savings account, that’s usually not the only requirement.

Just as with a personal account, banks must comply with certain regulations, including requirements to verify the identity of anyone who opens an account. The same applies to individuals opening a business account — the bank needs proof that you and your business are legitimate.

The exact documentation required to open a business account can vary between different banks, but you’ll probably need to provide the following information and paperwork in addition to your EIN:

• Your business license and/or state registration
• Your business’s formation paperwork, such as articles of incorporation
• Your business’s operating agreement
• Your “doing business as,” (DBA) fictitious business name or trade name paperwork

Depending on your state’s laws and the type of legal entity your business is, you might not have all those papers. For example, you may not need an operating agreement if you have a sole proprietorship or a single-member limited liability company.

If you only have an EIN and want to open a business bank account, most financial institutions will require the following additional information/documentation:

• Government-issued photo I.D. (e.g., a driver’s license)
• Your Social Security Number
• Your business’s registration documents

Every financial institution can set its own rules for what type of documentation you need to provide to open a business account or get a business credit card. Before you start applying for a business bank account, check with the institution to make sure you know what information you need to provide.

Alternatives for Opening a Business Bank Account

Many online-only banks are specifically set up to help small business owners who may need more flexibility than what traditional business bank accounts offer. For example, some online banks have lower minimum balance requirements and fewer fees than traditional banks.

However, even these online institutions will generally require specific information and documents before allowing you to open a business account. You’ll probably have to provide the following:

• Your EIN or SSN
• Your business’s registration
• Your license
• Ownership information
• Photo I.D.

Check with the bank you’re considering to see what documentation you’ll need to provide.

Steps to Take if You Are Unable to Open a Business Bank Account with an EIN Only

In some cases, you may not be able to obtain all the documents needed to open a business account. For example, if you’re a regular gig worker or someone who picks up the occasional odd job, you may not have an official business even though your work is similar to self-employment.

If you have to operate without a separate business account, make sure to do the following:

• Keep diligent records of all your personal and business financial transactions.
• Keep clear notes and receipts for all business expenses so you can provide them with your tax return when necessary.
• Open a new personal checking account just for your work income and expenses.
• Regularly create bookkeeping reports, such as profit and loss statements, so you understand what’s happening with your finances.

The Bottom Line: Opening a Business Bank Account with an EIN Only

Most banks require you to provide your EIN to open a business bank account, although you may be able to use your Social Security Number instead if you are a sole proprietor or have a single-member LLC.

Although an EIN is usually required to open a business bank account, it’s not usually the only information you’ll need to provide. Most banks and credit unions will also want your personal I.D. information along with details about your business, such as your registration paperwork and trade name. You may have to provide your formation paperwork, partnership agreement and/or business license.