An S corporation provides owners of a business with the ability to avoid double taxation while still receiving personal asset protection from company debts and obligations. An S corporation must adhere to certain rules, such as having no more than 100 shareholders, and not allowing foreign individuals and businesses to own shares in the company. Shareholders of an S corporation must separate the company's money from their personal assets. The documents needed for an S corporation to open a business account vary depending on the financial institution.
An S corporation may have to present a corporate resolution that details the individuals authorized to make transactions on the company's account. Authorized individuals must present the proper identification before gaining access to the company's account. They may have to present a valid state identification card or state-issued driver's license. A passport may be allowed as an acceptable form of identification. A secondary form of ID may be necessary, such as a social security card, credit card, bank statement or current utility bill.
Articles and Bylaws
An S corporation must present a financial institution with a copy of the company's articles of incorporation, also referred to as a certificate of incorporation. The articles contain basic information about the business such as a description of the company's activities, the name and location of the business and the number of shares the company has the authority to issue. The articles of incorporation indicate the state of incorporation and the date when the S corporation came into existence. Depending on the financial institution, an S corporation may be required to provide a copy of the company's bylaws. The bylaws are an internal document containing the rules and regulations for operating the business.
Every S corporation must get an employer identification number from the Internal Revenue Service. An EIN is used by the IRS to identify companies for taxation purposes, while financial institutions use an EIN to identify companies for banking purposes. An S corporation's EIN will appear on all banking correspondence. The IRS website allows an S corporation to obtain an EIN online, or an over-the-phone EIN application can be completed by calling 800-829-4933. The company must provide the legal name and address of the business, the number of people employed by the business, and a description of the company's business activities. The IRS will assign an EIN to the S corporation after receiving all the necessary information.
A financial institution may request financial statements, such as an income statement or a balance sheet. These statements are of importance to banks because they indicate the financial health of an S corporation. An S corporation that uses an assumed name for business may be required to present an assumed name certificate to the financial institution. The company may have to present a valid business license to the financial institution.
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