We often have clients call in with questions on banking. Once you form your company, you’ll need a bank account to do business. Here we will address some of the most common banking questions.
What do I need to open a bank account?
Typically, when opening a bank account in the US, the bank will require the approved Certificate of Incorporation/Formation, the tax ID number (EIN) and for an individual from the company to appear in person. Although banks are regulated by the Federal Government, they are also regulated by State banking laws too.
Banks can be different in what they require. We often tell clients to contact the bank of your choice to see what they require. Other items that banks may ask for can be:
Certificate of Authority: The Certificate of Authority, also known as a foreign qualification, is obtained through registering your business as a foreign entity in the state in which the company is operating and/or banking. Most banks require the valid Certificate of Authority (achieved through qualification) in order to open an account to those who show record of filing outside that respective State. The bank account is the point where revenue is channeled and is considered part of a company’s operations. Since every State has their own requirements for foreign qualification, let Harvard take care of this detail for you. Harvard Business Services has specialists who can assist you with the entire process.
For more information on foreign qualification, click HERE.
A Certificate of Good Standing: The Certificate of Good Standing, also known as a Certificate of Existence, is a Certificate provided by the Delaware Secretary of State’s Office stating the company is current with all Delaware franchise taxes, filings, and registered agent services. Many banks will require a Certificate of Good Standing when applying for a loan, line of credit or opening a merchant account. Also, before signing a large contract, a company may be asked to present a Certificate of Good Standing.
To order a Certificate of Good Standing for your company follow this link: https://www.delawareinc.com/ourservices/goodstanding.cfm
Do I have to open a bank account in Delaware when I form a Delaware Company?
No. Clients will often open a bank account where it is most convenient for them. This is generally the State in which they are doing business. It is common for Delaware companies to operate all over the world, and banks will typically understand that. This is where your Certificate of Authority will come in. This lets the bank know that even though the company was formed in Delaware, it is registered to operate in your home State as well.
These are some of the most common questions we receive on banking. If you have any other questions, Harvard Business Services will be happy to assist. While we do not directly open the bank account for our clients, we can assist in obtaining some of the documents that the bank will ask for.
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