Why Your Etsy Shop Needs a Separate Bank Account - zero to biz (2024)

FAQs

Why Your Etsy Shop Needs a Separate Bank Account - zero to biz? ›

KEEP IT SEPARATE

To make it easier to file your business taxes, set up a separate bank account to handle all of your Etsy expenses and transactions. This way, you have every business-related expense in one place and not mingled with your personal money.

It's permissible to use your personal bank account to receive Etsy payments. However, if you decide to structure your Etsy shop as a Limited Liability Company (LLC), things change. In such cases, you will be required to open a business checking account where Etsy revenues can be accepted.

Chase Business Complete Banking is an excellent option for Etsy businesses. It offers a straightforward account structure with no monthly service fee when certain requirements are met.

For your seller registration, you can use the same credit card and bank account for both your shops. Most browsers do not allow to be signed up to multiple accounts at a time, Etsy included. To manage different accounts, if you don't want to log in and out every time, you should use different browsers.

While you technically could use your personal bank account for business, it is generally not recommended. This is because mixing your personal and business finances could put your personal assets at risk if your business were to face legal issues.

Even if your financial institution doesn't say this (check your depositor agreement), you still shouldn't use the same checking account for business and personal expenses. All businesses, even very small ones, should keep these finances separate.

If you're running a business – that is, you're selling with the intent of making a profit – then you'll need an Etsy business license. But if you're just doing it for fun, as a hobby, then selling without a business license shouldn't be a problem. Keep in mind you'll have to pay sales tax regardless.

If you're based in the US, you can either operate your Etsy shop as an unincorporated entity — a sole proprietorship or a general partnership — or you can incorporate and form a corporation or a limited liability company (LLC). Sole proprietorships and general partnerships are the two simplest options.

How Much Does The Average Etsy Seller Make? The average successful seller on Etsy earns between $43,000 and $46,000 per year which is a fantastic foundation to build on as top earners make over $65,000 per month!

Is it safe to connect your bank to Etsy? ›

Etsy maintains records associated with transactions on Etsy Payments and does not pass any secure data, including credit card numbers or bank account information, to any sellers.

PayPal. If you choose to pay through PayPal, you'll be redirected to a secure PayPal page and then back to Etsy to confirm the order.

Credit cards are the most commonly accepted payment option for Etsy stores. It's easy to take credit card payments on Etsy by setting up a merchant account with either Stripe or Square. With these services, buyers enter their credit card information directly into Etsy.

Yes, you can have multiple businesses under one LLC.

You can run two or more businesses under one LLC by either: running all the business activities under one LLC name, or. registering DBAs (“doing business as”), also known as Fictitious Names.

We obtain location information you provide in your profile or your IP address. With your consent, we may also determine location by using other information from your device, such as precise location information from GPS or information about wireless networks or cell towers near your mobile device.

Etsy doesn't limit how many shops a single person can create. Open a second Etsy shop or even more, but consider if managing multiple Etsy shops fits your lifestyle.

Be sure to add your bank details within 30 days of your first sale to avoid your shop being suspended. You're required to verify your bank details within 60 days or your shop will be suspended. To update your bank account: On Etsy.com, select Shop Manager.

Etsy maintains records associated with transactions on Etsy Payments and does not pass any secure data, including credit card numbers or bank account information, to any sellers.

If you have not already, set up an e-mail address that is specifically for your Etsy business. Do not use your own "personal" email address to hand out to others.

Common business accounts include a checking account, savings account, credit card account, and a merchant services account. Merchant services accounts allow you to accept credit and debit card transactions from your customers. You can open a business bank account once you've gotten your federal EIN.