<\/span><\/h3>\n\n\n\nThe final step you\u2019ll need to complete in the pursuit of strong business foundations and proper business function is to open a bank account specifically for your Michigan LLC. <\/p>\n\n\n\n
It\u2019s easy to undervalue this step but it\u2019s an important one. Many small business owners choose to use their personal account for both their personal and business transactions, then try to decipher the difference between the two transaction types for federal tax purposes later. It\u2019s easy to see that the logic here is that one bank account for everything will be simpler in the long run, but there are two very important reasons not to do this. <\/p>\n\n\n\n
The first reason is that it\u2019s easy to determine when only business transitions are made from your business bank account because that is its dedicated purpose. Sure you may think that you\u2019ll be able to tell the difference between a personal and a business transaction when you go through your statements at the end of the year. However, when it\u2019s time to file your federal tax paperwork these purchases were often made months before tax season rolls around and it becomes a lot more difficult to remember which transactions were for what reason for tax purposes when you add time to the equation. So it\u2019s important that you have a bank account that\u2019s specifically for your business to make tax filing a breeze. <\/p>\n\n\n\n
The next reason is this: if you use your personal account for business transactions then you won\u2019t have personal liability and asset protection even though you formed an LLC in Michigan. This is because if you conduct business transactions through your personal account, your personal bank account becomes fair game for any creditor or person who sues your LLC. So if you want to keep your personal assets and information protected then just open another bank account for your business and keep your personal and business transactions separate. <\/p>\n\n\n\n
You\u2019re going to need a \u201cbank kit\u201d to open a bank account for your Michigan LLC. This kit will include things such as your LLC\u2019s Articles of Organization, Certificate of Good Standing, EIN and many of the documents you\u2019ve been filing and obtaining while forming your Michigan LLC. A lot of LLC formation services in the state will put together a bank kit for your business as part of their services which makes it a lot easier. <\/p>\n\n\n\n