The Differences Between Personal & Business Checking

Name on the Account

One of the main differences between a personal and business checking account is the name listed on the account. With a business account, a business owner can use his DBA -- doing business as -- name instead of his personal name when completing financial transactions. The name listed on checks and debit cards issued for the business account also shows the business name. It is more professional to send checks with your business name at the top -- and also request checks with your business name listed as the payee -- instead of the owner's name.

Tax ID Number

To open a personal checking account, you must provide a Social Security number. For a business account, you may have to provide an employer identification number, or tax ID number, in addition to your Social Security number.

Application Process

The application process for a business checking account is slightly more complicated than for a personal account. To open a business account, you must bring your state business registration forms, fictitious name form, articles of incorporation for a corporate entity and business license, if applicable. The bank must verify that you have a legitimate and registered company to establish the account in the company name. For a personal account, all you need is your state-issued identification and in some cases your Social Security card as well.

Benefits of a Business Account

Separating your business accounts from your personal accounts makes it simpler to manage your company's finances. At the end of the year, for example, you can simply pull up a year-end report from the business checking account to review charges and deposits in some cases. You don't have to sort through personal transactions to identify the ones that apply to the business when compiling financial statements if you have a separate business account. Having this information in one place also makes it simpler to analyze your business spending trends.