Opening a U.S. business bank account feels like it should be simple. You have a company, you have an EIN, you want a place to put money. Then you call a bank and the questions start, and some of them seem to have nothing to do with your business.
That is because the bank is not asking those questions out of curiosity. Federal law tells banks exactly what they have to check before they let anyone open an account, for a business or for a person. Two separate rules apply, and most guides online only mention one of them. This page walks through both, and explains why the legal requirement is the same for everyone, while the practical experience of meeting it is not.
What the law actually requires the bank to check
The starting authority is the Bank Secrecy Act, at 31 U.S.C. § 5318(h). It tells banks they must maintain an anti-money-laundering program. The Treasury Department then wrote the specific rules that programs have to follow. Two of those rules matter here.
The first is the Customer Identification Program, or CIP, at 31 CFR § 1020.220. It requires a bank's account-opening procedures to collect, at minimum, four things from every customer before an account is opened: name, address, an identification number, and (for individuals) a date of birth. For a business, the identification number is an EIN, or a comparable number for a foreign entity that has no EIN.
The bank then has to form a "reasonable belief" that it knows the customer's true identity, using risk-based procedures that verify identity to the extent "reasonable and practicable" for that bank to run. For a company, the rule specifically allows the bank to rely on documents like articles of incorporation to confirm the business exists. The rule does not require a specific document set for every bank; it requires each bank to have a documented procedure and to follow it.
The second rule is separate, and it is easy to miss because most articles conflate it with CIP. It is the beneficial ownership rule for legal entity customers, at 31 CFR § 1010.230. CIP verifies who is opening the account. The beneficial ownership rule makes the bank identify and verify the individuals who actually own or control the company behind the account — the people, not the entity. Passing one check does not automatically satisfy the other. A bank can confirm your LLC exists and still need a separate form from you listing who owns 25% or more of it, and who runs it day to day.
Why the EIN comes first
Before either of those checks can run, most banks need an identification number for the entity. For a company, that number is almost always an EIN issued by the IRS. It is free to apply for, and the IRS page on the subject describes it as the identifier the agency uses to track a business for tax purposes. Banks use the same number to satisfy the CIP requirement described above.
This is why the practical sequence for a new LLC is: form the company, get the EIN, then approach a bank. Skipping the EIN step does not just slow down your taxes. It removes the one number most banks are structurally required to collect before they can open the account at all.
Having an EIN is not, by itself, a guarantee that a bank will open your account. It satisfies one input to CIP. It says nothing about whether the bank's own risk-based procedures will accept the rest of your file, and it says nothing about the beneficial ownership check that comes after it.
🇺🇸 If the IRS counts you as a U.S. person
The legal checklist is identical to what is described above: an EIN, proof the entity exists, and beneficial ownership information for anyone who owns or controls the company.
What differs is how easily you can produce the supporting documents a bank's risk-based procedures usually ask for on top of the legal minimum:
- A state-issued driver's license or passport the bank's staff can recognize on sight.
- A U.S. mailing address and, often, a U.S. phone number.
- A Social Security Number for the beneficial owner check, which most identity-verification software is built to validate quickly.
- The ability to walk into a branch in person, which many banks still prefer for a new business account, even though nothing in CIP requires it.
None of this is a separate legal test. It is the same CIP and beneficial ownership rules, applied to someone whose documents match what the bank's systems were built to check first.
🌏 If it does not
Nothing in 31 CFR § 1020.220 or § 1010.230 says a bank may only open accounts for U.S. residents. The identification number the rule asks for a non-U.S. individual is a foreign passport number together with the country of issuance, explicitly listed as an acceptable alternative to a Social Security Number. The rule was written to accommodate non-residents.
What changes is not the law. It is which banks have built a working process for the file you can actually produce:
- Most large retail banks still expect a Social Security Number or ITIN for the beneficial owner and a U.S. address for the applicant, even though the CIP rule does not require either for a foreign national.
- A smaller number of banks, often ones that specifically market to non-resident founders, have built the risk-based procedures the rule allows for a foreign passport plus company formation documents.
- Some banks require the beneficial owner to appear in person at a U.S. branch at least once, which is a business decision, not a CIP requirement.
This is the gap between the statute and the market. The rule opens the door. Individual banks decide, within that rule, how wide to open it.
What is the same, and what is not
| 🇺🇸 U.S. person | 🌏 Not a U.S. person | |
|---|---|---|
| Legal requirement to open the account | CIP (§1020.220) + beneficial ownership check (§1010.230) | Same two rules, same sections |
| Identification number required | EIN for the entity, SSN for the beneficial owner | EIN for the entity, foreign passport number + country of issuance for the beneficial owner |
| Document banks usually recognize fastest | State driver's license or U.S. passport | Foreign passport, sometimes with a visa or entry stamp |
| In-person branch visit | Often optional | Often required by the specific bank, not by law |
| Which banks will actually open the account | Nearly any | A smaller list that has built a process for foreign passports |
Common mistakes
🇺🇸 If the IRS counts you as a U.S. person
- Assuming the EIN alone opens the account. It satisfies the identification-number part of CIP. The bank still runs its own risk-based check and the separate beneficial ownership check.
- Forgetting that a single-member LLC still has a beneficial owner to disclose — the LLC itself does not exempt you from § 1010.230.
- Waiting to apply for the EIN until after trying to open the account, then having to restart the process once it arrives.
🌏 If it does not
- Reading that a foreign passport number is an acceptable identifier under CIP, then being surprised that most branch staff still ask for a Social Security Number. The rule allows it; the individual bank's process may not be built for it yet.
- Assuming denial from one bank means the law bars non-residents. It usually means that specific bank's procedures were not built for a foreign passport file.
- Skipping the EIN because the owner has no SSN. The entity still needs an EIN regardless of the owner's tax status; the IRS issues EINs to companies with no U.S.-person owner at all.
FAQ
Does a non-resident need a Social Security Number to open a U.S. business bank account?
No, not under the federal rule itself. 31 CFR § 1020.220 lists a foreign passport number and country of issuance as an acceptable identifier for a non-U.S. individual. Whether a specific bank's own procedures are built to accept that in practice is a separate, bank-by-bank question.
Is an EIN the same thing as passing a bank's identity check?
No. The EIN satisfies the identification-number requirement inside the Customer Identification Program. It does not, by itself, satisfy the separate beneficial ownership verification required under 31 CFR § 1010.230, and it does not guarantee any specific bank will approve the account.
What is the difference between CIP and the beneficial ownership rule?
CIP, at § 1020.220, verifies the identity of the entity opening the account. The beneficial ownership rule, at § 1010.230, verifies the identity of the individual humans who own 25% or more of the entity, or who control it. They are two different checks under two different sections, run at the same time when a business account is opened.
Can a single-member LLC open a bank account without naming a beneficial owner?
No. A single-member LLC still has an owner, and that owner is the beneficial owner the bank must identify and verify under § 1010.230, even though the LLC itself may be a disregarded entity for tax purposes.
Why do some banks require a branch visit for non-resident owners and others do not?
Because § 1020.220 requires each bank to build risk-based procedures that verify identity to the extent "reasonable and practicable" for that bank to run. A branch visit is one way a bank can satisfy its own risk-based verification standard. Nothing in the rule requires every bank to make that choice, so requirements vary by institution.
Does having a registered agent or a virtual business address help open a bank account?
It can help satisfy the address and documentation the bank's own procedures ask for, but neither is a substitute for the EIN, the CIP identity check, or the beneficial ownership check described above. Banks decide separately whether they will accept a given address for their own file.