Which accounts should be business accounts and which should be personal accounts? Should profit go to a personal account and perhaps even tax and the other accounts be business?

Kevin SimpsonCPA Web Books · Founder at CPA Web Books

Which Accounts Should Be Business Using Profit First- Ask Mike

31 Aug 2020 · 1 min

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Kevin asks if profit and tax funds can stay in personal accounts while keeping other business accounts separate. The answer: set up all accounts as business accounts. Mixing personal and business accounts creates unnecessary complexity.

Questions this video answers

If you have a business, make all your accounts business accounts. Technically you could mix personal accounts, but that gets convoluted. Set up all accounts as business accounts once and for all.

I got a great question that came in from Kevin, also around profit. First he said which accounts should be business accounts and which accounts should be personal accounts? Shouldn't profit go to a personal account and perhaps even tax and the other accounts be business? The simple answer is this. If you have a business, make all your accounts business accounts. Now, technically, you could have some personal and so forth, but. But I would argue that that gets a little bit convoluted. So set up all your accounts as business accounts once and for all, and you're done. It's that simple.