Can I use my personal cash account for business?By Nina Kaufman, Esq.
Q.: I have just received my DBA and I’m ready to begin my own business. I would like to clarify once for all if I can use (as I would like) my personal cash account for business purposes too. A friend of mine says so but on my bank website looks like I need a separate cash account as my business account. Since it is a type of business entity which legally has no separate existence from the owner I feel I can use my personal cash account but I would like to receive a confirmation about that. Which type of cash account do I need?
A.: Can you use your personal cash account for business purposes? Yes. There’s no law that says you can’t, especially as you’re operating as sole proprietor. Should you? Absolutely not. If you’re serious about being in business, get serious about accounting for your business expenses and transactions properly by having a separate cash account for your business. It can also save you money on accounting fees, as you’ll save your accountant time and frustration in trying to parse out your business from your personal expenses if you’ve taken all of them from the same cash account.
What other law questions do you have about company ownership and board meetings?