Ally is a hugely popular online bank that offers checking and savings accounts as well as auto loans and mortgages. Regularly appearing on lists of the best online banks, Ally is known for its high-yield savings accounts where you can earn an APY that is 10 times the national average. But when it comes to business checking, there are other options you’ll want to consider.
Can You Open an Ally Account for a Business?
If you’re a fan of this bank and are a business owner or freelancer, you’re likely looking to open an Ally business checking account. However, the online bank doesn’t have a business option. Read on to learn about Ally bank and other business account alternatives to consider.
Ally is an online bank, meaning there are no branches to visit. Instead, you can open a checking or savings account online, or use the mobile app to deposit checks remotely, and transfer money electronically. You can even transfer money with your voice through Amazon’s Alexa.
For its checking option, there are no monthly maintenance fees, no minimum opening deposit, no minimum balance requirements, no ATM fees at Allpoint ATMs and incoming wire transfers are completely free — three outstanding features.
Can I use an Ally personal account for my business?
Unfortunately, there isn’t an Ally business checking account option; Ally only offers personal Ally bank accounts.
You may be thinking about opening an Ally account and using it for your business anyway. While it’s technically possible to use a personal checking account for business if you’re a sole proprietor, it’s not a good idea.
If you use a personal checking account for your business, your accounting can become a nightmare and you could run into trouble at tax time. If the IRS decides to audit your business, they’ll be able to review your personal accounts, potentially causing your income to be overstated — and leading to a higher tax bill.
It’s also harder to receive payments from clients. Personal accounts usually can’t connect to credit card or debit card payments like business accounts can, which can cause issues when clients try to pay you.
Finally, separating your business finances and personal finances is important when it comes to legal liability. If you run your business from a personal checking account, the line between your personal and professional finances becomes blurred, and may result in personal liability.
Pros and Cons of Ally Bank
As with any bank account or financial institution there are pros and cons to consider:
- Good APY on Ally interest checking account
- No overdraft fees
- No minimum account balance requirement
- Free ATM use in U.S. for in network ATMs
- ATM fee reimbursements (with limits)
- Wide range of services
- No business checking or savings
- No physical branches
- Fees for some transactions
Ally business checking account alternatives
Although Ally doesn’t offer a business checking account option at the moment, there are other business checking accounts worth considering:
4. Bank of America
5. Capital One
Frequently Asked Questions about Ally
Here are some of the most commonly asked questions about Ally bank offers:
1. Does Ally offer business checking accounts?
Unfortunately, Ally doesn’t currently offer business checking accounts or business savings accounts. It only offers personal accounts, so you’ll need to find another bank for your business needs.
2. Can you use a personal checking account for business?
While you can technically use a personal checking account for business purposes if you’re a sole proprietor, it’s not recommended. It opens you up to legal liability and tax issues that could cost you over the long run.
Instead, open up a dedicated business checking and savings account with a bank — either online or traditional — that caters to small business owners.
3. What is the best free online business checking account?
When it comes to the best online business checking accounts with no monthly maintenance fees and no minimum balance requirements, you’ll have several options to choose from including:
4. What is the best business savings account?
If you’re looking for the best business savings account, check out CitiBusiness Savings. With Citi, you’ll earn a competitive interest rate, and there’s no minimum required deposit.
5. Can I open an Ally account for an LLC?
Unfortunately, since Ally doesn’t offer business checking or saving accounts you can’t open an account for your LLC.
6. Do I need a business bank account for an LLC?
Yes, if you have an LLC you should use a business bank account. Failing to do so may jeopardize the asset protection benefits of a business entity.
8. Is Ally Bank a legitimate bank?
Yes, Ally Bank is a legitimate bank. They are a Member FDIC and Equal Housing Lender. FDIC insurance provides protection against bank failure or theft for up to $250,000 per depositor. Being an Equal Housing Lender holds the bank to Federal Fair Lending Laws. If you are looking for a financial institution for your personal banking needs, Ally Bank is certainly an option.
Opening a business checking account
If you’re thinking of opening a new business checking account, you may be disappointed to find out that Ally business checking isn’t an option. Luckily, there are a number of other business banking options that offer the same level of convenience that Ally offers, including fee-free and low fee options.
Compare the Best Business Checking Accounts
Opening a business checking account can increase your chances of getting financing and simplify your cash flow management. Use our research to quickly and easily find the right account for your business.
This article was originally written on September 30, 2019 and updated on January 18, 2023.
Rate This Article
This article currently has 19 ratings with an average of 4.5 stars.