Yes, S corporations can open and must maintain separate business checking accounts

An S corporation is a tax classification, not a legal structure. Your business is still a corporation under state law, which means it is a separate legal entity from you as the owner. The IRS and your state both expect that entity to have its own bank account—not a personal one, not a shared one. Most banks will open a business checking account for an S corp without hesitation, though the paperwork is slightly different than it would be for a sole proprietorship or partnership.

The key difference is what you bring to the bank. Instead of a Social Security number and a driver's license, you bring an Employer Identification Number (EIN), articles of incorporation, and proof that you are authorized to open the account on behalf of the corporation. The bank needs to verify that the corporation exists and that you have the right to act for it. Once you have those documents, the process moves quickly.

Key Takeaways

  • S corporations must use a separate business checking account; commingling personal and business funds can pierce the corporate veil and expose your personal assets to liability.
  • You will need an EIN, articles of incorporation, a corporate resolution or certificate of good standing, and a government-issued ID to open the account.
  • Most banks treat S corp accounts the same as C corp accounts during setup; the tax classification does not affect whether you can open one.
  • Some banks charge higher monthly fees for business accounts or require a minimum balance; compare options before choosing, as costs vary widely.

What documents the bank will ask for

Banks have a standard checklist for business accounts, and S corps need to provide most of it. You will need your Employer Identification Number (EIN), which you get from the IRS—if you do not have one yet, you can explore online at irs.gov and receive it when ready. You will also need your articles of incorporation, which is the document you filed with your state to create the corporation. This proves the corporation legally exists.

The bank will also ask for a corporate resolution or certificate of good standing. A corporate resolution is a document signed by the board of directors (or, if you are the only owner, by you in your capacity as director) that authorizes someone to open a bank account on behalf of the corporation. A certificate of good standing is issued by your state and confirms the corporation is in good legal standing. Either one works; many banks accept the certificate because it is issued by the state and requires no internal paperwork from you. You can request one from your state's Secretary of State office, usually online, for a small fee.

Finally, bring a government-issued photo ID—your driver's license or passport. The bank needs to verify your identity as the person authorized to open the account. Some banks also ask for a recent business license or tax return, though this is less common for new accounts.

Why keeping business and personal money separate matters for S corps

An S corporation exists to protect your personal assets from business debts and lawsuits. If someone sues the corporation, they can go after the corporation's assets, but not your house or car. That protection only holds if you treat the corporation as a separate entity. Mixing personal and business money in one account—or worse, using a personal account for business expenses—is called piercing the corporate veil. A court can use it as evidence that you were not respecting the corporation's separate status, and if that happens, your personal assets become fair game.

The IRS also watches for commingling. If you run business income through a personal account, the IRS may argue that you are not actually operating as a corporation, which can trigger an audit and penalties. A separate business checking account is the clearest, cheapest way to prove you are serious about maintaining that separation. It also makes tax time easier: your accountant can pull one statement instead of sorting through personal transactions.

How to choose between banks and account types

Most banks offer business checking accounts, but the terms vary. Some charge a monthly fee ($10 to $50 is typical), while others waive it if you maintain a minimum balance or set up direct deposit. Some offer a limited number of free transactions per month; others charge per check or per transfer. Online banks often have lower fees than brick-and-mortar branches, but you lose the option to deposit cash or speak to someone in person.

Before opening an account, compare at least three banks on these points: monthly maintenance fee, minimum balance requirement, per-transaction costs, check printing fees, and whether they offer online banking and mobile deposit. If you plan to deposit cash regularly, confirm the bank has branches or ATMs near you. If you will mostly transfer money electronically, an online bank may save you money. Ask whether the bank reports to business credit bureaus; some do, and building business credit can help you borrow later.

What happens if you do not have an EIN yet

You cannot open a business checking account without an EIN. If you have not filed for one, do it before you go to the bank. The process takes minutes online at irs.gov/ein. You answer a few questions about the business, and the IRS issues the number when ready. You do not have to wait for a letter in the mail; you can use the number right away. If you prefer to explore by phone or mail, those routes take longer—phone is same-day if you call during business hours, and mail takes about four weeks.

Once you have the EIN, you can open the account. Some banks will let you start the process online and finish it in a branch; others require you to come in person. A few will accept documents by email or mail if you cannot visit. Call ahead to ask what the bank prefers, especially if you are opening an account at a bank where you do not already have a personal account.

Fees and costs to watch for

Business checking accounts cost more than personal accounts at most banks. A typical monthly fee ranges from $10 to $50, though some banks waive it if you keep a minimum balance (often $1,000 to $5,000) or receive direct deposits. Check printing is usually extra—$50 to $150 per box of 200 checks. Wire transfers, ACH transfers, and stop-payment requests often carry individual fees of $15 to $35 each.

Online banks and credit unions tend to charge less. Some online banks offer free business checking with no minimum balance and no monthly fee, though they may charge for checks or wire transfers. Credit unions sometimes offer lower fees to members, but you have to join first. If your business is very small and you do not write many checks or make wire transfers, the savings can add up. If you are processing payroll or making frequent transfers, the fee difference may be small compared to the convenience of a full-service bank.

Frequently Asked Questions

Can I use my personal checking account for my S corp business?

No. Mixing personal and business money weakens the legal protection the corporation provides and can trigger an IRS audit. A separate business account is required to maintain the corporation's status as a distinct legal entity.

Do I need a business license before opening a business checking account?

No. You need an EIN, articles of incorporation, and proof of authorization (a corporate resolution or certificate of good standing). A business license is not required to open the account, though some cities require one to operate legally.

What if the bank asks whether I am a C corp or S corp?

Tell them you are an S corporation. The bank is asking about your tax classification so it can report the account correctly to the IRS. The account itself works the same way regardless; the difference is only in how the business is taxed.

Can I open a business checking account online, or do I have to visit a branch?

Some banks let you open online and finish in a branch; others require an in-person visit. A few accept documents by mail or email. Call the bank and ask what they require. Online banks may have a fully remote process, though you may need to verify your identity by video call.

What if I am the only owner of the S corp—do I still need a corporate resolution?

You still need proof that you are authorized to open the account. A corporate resolution signed by you as director works. Alternatively, a certificate of good standing from your state serves the same purpose and is often easier to obtain.