If you’re running your own private practice, you may have wondered whether it’s necessary to have your own business checking and savings account in addition to your personal bank accounts. The answer is a resounding YES!
At Heard, we encourage all clinicians with their own businesses to set up business accounts.
Don’t think of having an additional bank account as a hassle in itself; in reality, the move requires minimal effort and can lead to long-term financial gains. The three primary benefits of having a separate checking and savings account for your practice include:
- Tracking your practice’s cash flow. This one may seem obvious, but the advantages are endless. You’ll never have to spend time wondering which expenses are personal or business, and you will get a better gauge of how much your business is actually earning. Additionally, with services like Heard, you can track the financial health of your practice and receive personalized reports with ease.
- Audit-proofing your business. As much as we hate to think of the IRS following up with any of us, it does happen, and having your business financials kept separate will ensure you have a clean paper trail of your expenses and income.
- Receiving tax deductions. This is the holy grail of private practice perks. Many business expenses can be deducted from your income taxes, so keeping track of those expenses accurately and separately can be financially beneficial when filing your taxes.
Additional benefits can include qualifying for special banking deals, such as business loans or credit cards.