Business Credit Cards Make Sense

by : Terry Fitzroy

It would be a good decision for you to look into business credit cards if you work in a small business, or are a small business owner. There are many advantages to using a small business credit card, as apposed to only using your own personal credit card all of the time. This article will attempt to shed some light on the reasons you should consider applying for a small business credit card, and the advantages there are to using one. Take everything here into consideration before you start making large purchases for your business on your personal card.

These credit cards will provide you with the ability to keep personal and business expenses and purchases separate.
This will make it easier to keep records of your business transactions as well. Some people refer to this as "co mingling" your funds, and it is a sure fire way to get yourself audited by the internal revenue service if you are not careful.

You are going to need to start keeping track of your business expenditures separately from your personal account sooner or later, so you might as well go ahead and open up an account now. Another great benefit of having the business credit card account is that it opens up another line of credit for you to use without putting your personal credit in jeopardy. It's always nice to be able to have another emergency fund to lean on, and your business card can serve that purpose.

You will also benefit from the additional perks that these cards can offer you. For one thing, you will look a lot more professional when you go to buy a certain item for your business. When the card has your business name on it, you are a lot less likely to have issues as apposed to using your own account. This is good too, because it will allow you to start building credit on your business account in case you should need to take out a small business loan from the bank. They will see that your business has a good credit history, and will have no problem giving you necessary start up funds for a new project.

The biggest perk in getting business credit cards is being able to separate your business and personal expenses. This is an important factor in establishing the business as an entity separate from the owner, because when you file your taxes you will get much larger tax breaks on your personal income. It would also be a good idea to go ahead and open a limited liability company (LLC).

In the past, all small business credit is based on the owners personal credit. However, this can cause problems, especially if the business owner has bad credit. This is probably my favorite perk of all. If you have horrible credit, opening a small business is your chance to start completely fresh. You have already made the mistakes in the past that have caused your credit to crash, and you are not likely to do that again are you? Opening up a business credit card account is probably the smartest thing you could to if you are looking to start fresh.