business bank account?

[PlayaMama]

hi,

if you have a bank account for your business how do you pay yourself? i'm considering opening an account and i want to know how i will be able to access the money. right now, i have just been getting my checks cashed and then using the cash for my own expenses as well as anything i need for the business.

i do consulting work so it's not like i really need a great deal for the business.

i guess, i'm afraid that having the money in an account under the business name will make it subject to greater scrutiny, like if i go grocery shopping i can't use the business account, but if i transfer all the money out of the business account won't that look suspicious too?

tia!

[changingseasons]

Suspicious in what way? And why couldn't you use a business account at the grocery store??

I opened a business and personal account, in hopes of using my business account ONLY for business purchases, and then transferring money into my personal account whenever I needed it for personal purchases. But after a while, I just used my business account for pretty much everything. Which makes it a little more confusing at the end of the year, when you're trying to do tax deductions and things... but if you document well and keep track of which purchases were business/personal, I don't think it makes a difference what type of account you have.

[kokonutmama]

I have business bank accounts and credit cards and personal bank accounts and credit cards and am fastidious about using only the appropriate accounts for each purchase. I have an automatic transfer from my biz to my personal checking that happens once a month, that's how I pay myself.

I do only have the biz paypal account because I forgot the password for my personal one and got locked out so every single time I use the biz paypal for a personal purchase, I account for it as an owner's withdraw.

I think as long as you keep good books you're ok.

[PlayaMama]

okay, honestly, that is exactly what i told my husband but he seemed to think that flags would be raised with the irs if we took too much money out for personal use. so he wanted me to check with some other wahm.

thanks!

[nursingmom]

but your business is your money. taking money out for personal reason is not a problem. the only thing is that it's hard to keep track of business expense vs. personal expense when u are doing your taxes.

in my area, all business checking accouts are free (limit of 350 transactions/month). i have both business checking and personal checking. if u need to use someting for personal, simply transfer the business checking money to personal checking money. the business checking is your personal money. i don't think there is any red flags for irs as long as u do not report personal expense as business espense at the end of the year.