Opening a bank account for your business is one of the best ways to keep your personal and business funds separate. There are many things that can go wrong when you co-mingle funds from your business and personal finances. Each one of those problems is listed below. If you cover all your bases, you can keep both sets of assets protected.
Sole Proprietorship
Even if you are the sole proprietor of a business, you must not put your finances together. The purpose of incorporating your business is to make sure that you can keep your personal assets protected, in case your business folds or is sued. When you bring assets together, you could be accused of fraudulently trying to hide or inflate your finances. Be very careful to keep the two separate so that you are above reproach.
Payroll
When you are trying to make payroll every week, you cannot use other funds to finance your payroll. You must make sure all the money that pays your employees comes from a business account. Your incorporation protects the business account. If you begin to use your personal finances to make payroll, your employees could sue you in the future for wages, and count your personal finances as assets of the business. This could quickly drain your bank account when you thought you were protected.
Incorporating
A Palm Springs corporate attorney can draw up the paperwork that is needed for your establishment. When you contact our Palm Springs corporate law firm, we can determine the kind of corporation you need to start, begin the filing, ask you to fill out the paperwork, and file that paperwork with the right authorities.
If you are planning to start your own business, you must be organized. Keep your personal and business finances separate, and follow the advice of your attorney. Contact our law firm at 760-322-2275 for a consultation.
