The benefits of a United States bank account are clear to many non-resident aliens, international businesses, and international businesspeople, but opening one has become frustrating for non-US persons after 9/11 and the passing of the Patriot Act. Unclear regulations have led banks to develop their own wildly different policies, confusing and frustrating many individuals and small businesses.
Despite recent obstacles, it is not necessary to be a U.S. citizen or possess a green card to open a U.S. bank account or to operate an LLC or Corporation formed in the U.S. With the right preparation and documentation, most non-U.S. persons should be able to open a U.S. bank account.
A personal account has compelling interest to a frequent U.S. traveler, an individual planning on relocating to the U.S., or even a student with plans to pursue studies here.
Business entities should create and maintain a separate corporate U.S. bank account, which is invaluable for keeping in compliance with Internal Revenue Service (“IRS”) record-keeping requirements and managing the company’s resources. And while the US dollar has faced some challenges from other currencies and crypto-currencies, it still remains the reserve currency of choice, and looks to remain so for some time.
- Access your money freely while in the U.S.
- U.S. bank accounts typically earn more interest
- If work is planned with a U.S. company, ease of directly depositing salary into an account
- Easier shopping online
- Handling payments is easier
- Avoid the hassle of foreign currency and expensive foreign exchange fees
- More convenient to do business with U.S. customers
- Easier receiving online payments
- Access to money freely
- Compliance with IRS and US government agencies
Non-Resident Opening Account Remotely
Many, but not all, U.S. banks require applicants to apply in person; however, some allow you to avoid this hassle and apply online. Although online application can come with a higher chance of disapproval, in most cases, this is still an attractive alternative to the hassle of in-person application. Some banks allow electronic submission of documents by scanning and emailing, or through an online portal. Although opening an account from abroad may be feasible, banks frequently require exceedingly high average balances, which may be impractical or impossible for most individuals and small businesses, especially in the start-up stage.
Citibank currently allows remote application, but they require a particularly high average balance ($50,000, as of writing). Although banks reserve the right to deny an application, a non-U.S. citizen can open a checking or savings account without an U.S. Social Security Number (“SSN”). A non-resident must, however, produce a U.S. based local address to connect with the account. Contingent on the work or study status of the individual applying, the bank may request a copy of more information before opening the account.
Banks require a foreign applicant produce two forms of personal ID, which must include a passport but can be supplemented with a driver’s license, debit card, work visa, or student visa. If the applicant has a job or residence, he must produce documentation to verify each.
Especially for a corporate account, it is well established that personally being present in opening a bank account is the easiest. In the event you cannot travel to the U.S. to open your company’s account, certain banks, such as Wells Fargo and Bank of America, are known to set up accounts remotely.
A sound first approach is to find a bank that also operates both in the U.S. and locally in your country, and that will allow you to open a U.S. bank account. The next best option is to employ a company that assists foreign applicants with opening corporate bank accounts in the U.S. If, the bank does not accept your application initially, forming a U.S. business entity will likely make it easier to open an account. In forming a subsidiary, you can now take this paperwork to the bank to open an account.
The requirements for setting up a corporate/business account differ between banks but typically include:
- passport and secondary ID;
- articles of incorporation/organization and other organizational and evidence of stock or membership units issuance;
- proof of address (i.e. billing statement/utility bills);
- Employer Identification Number (EIN) (an EIN is a unique identifying number assigned by the IRS to a business, and it is an absolute requirement to opening a U.S. business bank account);
- business address;
- initial deposit; and
- expected cash flow figures.
Non-Resident Traveling to State of Incorporation
In many cases, although it is possible to remotely open a bank account in the U.S. through a firmly established banking relationship, opening up a bank account remotely is not feasible. This mostly pertains to small businesses or individuals creating an account for smaller transactions.
- Travel to the bank of choice
- Present the required documents
- Apply and enroll in an account
- Make the initial deposit
One of the rules facing banks is the “know-your-customer” rule. While this may sound like a demand that banks return to the days of friendly customer service, it means that they must verify the identity of their customers to screen out potential bad actors.
Under the know-your-customer rule, a recent arrival to the U.S. may be denied via an online account application, due to their limited credit history here. Applying for a bank account in person, with a face-to-face interaction, will make the process of handling these issues much easier. As stated above, it is legal to open a bank account without a SSN, but this will be dependent on the individual bank’s policy. Essentially, on a visit to the U.S., and armed with a passport and visa, copy of international home address, and an initial deposit, a foreign individual can open a personal bank account in the U.S.
After applying and receiving your EIN, as discussed above, a non-resident can execute an application for a U.S. bank account. Ideally, a foreign individual will want to contact the bank where they plan to open an account and discuss with a representative the documents and information they will need to provide.
Particularly for business/corporate bank accounts, personally opening the bank account is the most efficient and easiest method. Once the account is set up, the account holder can now work with companies that aren’t necessarily geared to do business internationally.