Homeschool leader has trouble opening a checking account

checkbook07

Hello Carol.

This morning, Laura and I went to the bank to open a new checking account. We were told that in order to open our account we would have to register with the Missouri Secretary of State.

We then went home and tried to register with the Missouri Secretary of State, and we got stuck because it asked us for our charter number, which we don’t have.

Then, we called a different bank hoping to get some more information. We were advised by that bank to go on-line and File a Fictitious Name. We proceeded to try that, but then came to a page that asked us to enter the “owners” names and information. Laura and I are not sure if we are the “owners” and what that means exactly. We are also wondering if filing for a fictitious name is going to affect our status of being non profit.

We would so appreciate any advice you could give us. It seems so simple to just go and open a new checking account, but we just keep running into problems!

Jackie in MO

Jackie,
Sorry you had so many problems with your bank! I think banks are notorious for giving out bad information.

My own bank manager told me that I needed 3 separate checking accounts for my 3 different DBAs. I said, “I’m a CPA and I know that’s not true!” (She agreed!)

I answered a similar question on my blog post about fictitious name registration.
http://homeschoolcpa.com/opening-a-checking-account-shouldnt-be-this-expensive/
I told her this:

“Hopefully, you used the name of your group on the EIN application as well. If so, tell that to the bank (and show the IRS confirmation letter of your EIN) and you should not need a name registration.”

IOW, you are using your organization’s real name, not a fictitious name, so why do you need a fictitious name registration? (you don’t)

You’re correct that you are not the owners. Nonprofits do not have owners. You should open the checking account with the names of the officers (usually president and treasurer) as check signers, but not owners.

I hope you were very clear with the banks that you are opening a nonprofit checking account.

I don’t know enough about MO’s Secretary of State to know what “register with the state” means. This page might help: http://www.hurwitassociates.com/l_s_initial_mo.php
It’s a summary of what nonprofits need to do in the state of Missouri. A lot of things are not needed until after you receive 501c3 tax exempt status.

I hope that helps!

Carol Topp, CPA

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