Using a New Personal Bank Account for an LLC?

Business Structure: LLC

Country: US

State: Texas

City: Austin

Income: So far? $0

I am forming an LLC and was looking into "business" checking accounts, and most charge some kind of fee. Either monthly, per transaction, or both. Meanwhile, "personal" checking accounts usually do not.

Now, I know that I need to keep business and personal finances separate, especially in the case of an LLC, but does my business account have to be a "business" account, or just a separate "personal" account.

I saw a few questions similar to this one, but they all just reiterate the same "always keep personal and business assets separate" line.

My question is: Does my business checking account have to be a "business" account, or can it just be a separate "personal" checking account, but dedicated to business assets.

From legal perspective there's no difference between "business" account and "individual" account. Its the terms of usage of the bank that vary. Business accounts cost more to maintain, and the bank will know that its a business account so I doubt it will be opened as "individual". Remember, it has to have the LLC as the account owner.

Technically, you can have your personal account (not in the name of the LLC, but in your own name) be used for the LLC finances, but that's only assuming you're not opting in to be taxed as a corporation, and not going to receive checks payable to the LLC. It is also an opening to piercing the corporate veil. You should always keep your personal and business finances separate, and using a personal account for LLC finances may invalidate the limited liability protection the LLC provides, thus rendering it useless. So while you won't be breaking any laws by that, in case you're in need of that limited liability, trying to save a couple of dollars a month can cost you the whole and unlimited liability later.

Talk to your Texas attorney and CPA for more details and local specific legal requirements.

BTW: shop around. You can find a business account without fees (assuming its a small business). Check your local credit unions too.