The Internal Revenue Service distinguishes between investors and traders. That said, not every sole proprietorship can elect to become an LLC. A sole proprietor files taxes under their own name and is personally liable for any debts or actions taken against the business. After everything is up and running with the new LLC/Corp, close out the bank account to your sole proprietorship and dissolve the DBA name linked to you personally. So, in theory, you can use your personal bank account for business transactions, as long as your bank allows this. Question: At a Credit Union, can a member open a checking account in their personal name and deposit checks payable to their Sole Proprietorship business name? A sole proprietorship is a business with a single owner. CAN you use your personal bank account? For example, your legal name is John David Smith, and that is the legal business name assigned to the EIN. However, you may need to open a business bank account for certain business activities, like payroll or credit card processing. If you do not want your personal car or bank account to be potentially at risk in lawsuits against your business, for example, an LLC could be a better option. If you are a sole proprietorship you technically could but it would not be a good idea. Setting up a bank account for a sole proprietorship is a simple process and can be done in five steps. Maybe there are differences in details, I'd have to pull out the old paperwork. A Sole Proprietorship bank account is a separate bank account for your sole prop business. If you operate a sole proprietorship, you are personally liable for any business debts and legal obligations. It does not have a separate legal entity; The owner has unlimited liability; It cannot own property; Advantages of Sole Proprietorship. When you are converting a sole proprietorship to an LLC, you need a unique business name. If you are a sole proprietor, you also assume all the risks of the business. It is the dream for many people. save. Some banks require one to open a bank account and it can reduce the risk of identity theft. Regardless, a few banks will still request the EIN. Close . Sole proprietorships are popular with many business owners because of how simple they are to form and maintain, although they have disadvantages as well. If your business structure is a sole proprietorship, you can technically get by with a single bank account because your business and personal finances are already intertwined from a legal perspective. However, it is best not to. Each PP account (biz or pers) must have unique email address, however a bank account can't be linked to more than two PP accounts so you may be able to use the same bank account for a second PP account. 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