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#1243842 - 08/05/09 09:06 AM Financial question re: piano teaching income
Gisele Offline
Full Member

Registered: 06/08/09
Posts: 158
Loc: Schenectady, Saratoga Counties...
Hi,
I am just curious as to whether anyone opened up a business account for their piano teaching income or use a personal account. Are there any advantages to using a business account for a piano teacher?

Gisele
_________________________
Gisele Sum, gsum82-piano@hotmail.com
Piano and Theory Teacher
Principal Church Organist and/or Choir Accompaniment

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#1243925 - 08/05/09 11:03 AM Re: Financial question re: piano teaching income [Re: Gisele]
Kreisler Offline


Registered: 11/27/02
Posts: 13825
Loc: Iowa City, IA
It mostly depends on your business model. If you're a sole proprietor, then a personal account is fine. If you're set up as an S Corp or something, then having a dedicated account can make the bookkeeping a lot easier.
_________________________
"If we continually try to force a child to do what he is afraid to do, he will become more timid, and will use his brains and energy, not to explore the unknown, but to find ways to avoid the pressures we put on him." (John Holt)

www.pianoped.com
www.youtube.com/user/UIPianoPed

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#1243933 - 08/05/09 11:07 AM Re: Financial question re: piano teaching income [Re: Kreisler]
R0B Offline
1000 Post Club Member

Registered: 11/03/08
Posts: 1449
Loc: Australia
In my case, as a sole proprietor, I opened a second personal account, sub-titled, 'music'

Business accounts usually attract higher fees and charges (at least here in Australia)
_________________________
Rob

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#1243938 - 08/05/09 11:12 AM Re: Financial question re: piano teaching income [Re: R0B]
jotur Offline
5000 Post Club Member

Registered: 09/16/06
Posts: 5813
Loc: Santa Fe, NM
As someone who "does the books" for a living, I prefer separate accounts, with money moved from the business account to the personal one to cover personal expenses. It's much easier to total business expenses and fill out IRS forms that way. As R0B says, they can both be "personal" accounts by bank standards, and as Kreisler says, if one is a sole proprietor there's not a requirement for separate accounts. I just happen to find it a cleaner way to do things. Just me, though -

Cathy
_________________________

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#1244150 - 08/05/09 04:42 PM Re: Financial question re: piano teaching income [Re: jotur]
John v.d.Brook Offline
7000 Post Club Member

Registered: 03/18/06
Posts: 7507
Loc: Olympia, Washington, USA
I keep a separate checking account. Most banks want more money for commercial accounts, and as a micro-business, it's hardly worth it.
_________________________
"Those who dare to teach must never cease to learn." -- Richard Henry Dann
Full-time Private Piano Teacher offering Piano Lessons in Olympia, WA. www.mypianoteacher.com
Certified by the American College of Musicians; member NGPT, MTNA, WSMTA, OMTA

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#1244193 - 08/05/09 05:42 PM Re: Financial question re: piano teaching income [Re: John v.d.Brook]
Stanny Offline
1000 Post Club Member

Registered: 11/08/06
Posts: 1461
The IRS prefers you to have a seperate account. I do my banking at Fidelity, and additional accounts are no extra charge.
_________________________
~Stanny~

Independent Music Teacher
Certified Piano Teacher, American College of Musicians
Member: MTNA, NGPT, ASMTA, NAMTA

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#1244462 - 08/06/09 03:31 AM Re: Financial question re: piano teaching income [Re: Stanny]
Chris H. Offline
2000 Post Club Member

Registered: 10/14/05
Posts: 2919
Loc: UK.
I have always had a business account. Like Cathy said it really makes the book keeping easier.
_________________________
Pianist and piano teacher.

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#1244494 - 08/06/09 06:27 AM Re: Financial question re: piano teaching income [Re: Chris H.]
Akira Offline
1000 Post Club Member

Registered: 07/27/07
Posts: 1645
Loc: Los Angeles, CA
Having a separate account simply makes the accounting for your business easier and more accurate when it comes time to do your tax return (or financial statements, if you do them). Sometimes its not very convenient to carry around checks when you want to make a disbursement, so depending on your situation, a separate credit card could help with segregation, as well.

However, if you can easily identify all of your income and expenses associated with your business via your personal account when they're co-mingled, then you don't need one. Depending on your bank, these extra accounts may carry monthly or annual fees. Additionally, it doubles the adminstrative work in reconciling bank accounts.

Weigh the pros and cons of your particular situation, and decide what works best for you.

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