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No, you do not need a registered business to open a business credit card. You can use your Social Security number and open a business card as a sole proprietor.
The short answer is no, you do not need an Limited Liability Corporation (LLC), corporation, or Employer Identification Number (EIN) to open business credit cards. Most small businesses in the United States run as a “sole proprietor.”
In a sole proprietorship, you can only have one employee: yourself. Technically you can employ your spouse as well, but we don't need to get into those nuances at this point.
A sole proprietorship is when the business and person are the same entity. In other business structures, the business is a separate entity and the owners and managers are not liable for debts of the corporation.
Anyone Can Apply for Business Credit Cards
Many military servicemembers aren’t aware of the fact that anyone can apply for business credit cards, even if they are not part of a corporation or LLC.
Can I apply for a business credit card without a business?
Yes, you can apply for a business credit card without a business. Just use your own name as the business name and your Social Security Number (SSN) as the Tax ID.
Any individual can be a business as well. It's a business type known as a “sole proprietorship.” It means you are a business with one employee: yourself.
I ran my website as a sole proprietorship for years before converting it to a limited liability corporation or LLC. I didn't make any money from the site at the time but I was still eligible for business credit cards.
How to Qualify For A Small Business Credit Card
You can qualify for a small business credit card through any number of businesses. If you have any kind of income or do any work outside of your normal W-2 income, like your military job, you can setup as a business.
Some of the most common qualifying businesses include:
- Driving for Uber or Lyft
- Selling items on Craiglist, Etsy, Amazon, or eBay
- Running a blog or website
Remember, a business doesn't have to be profitable or even sell anything to be a business. If they ask you to list your business revenue on the application, $0 is a legitimate amount.
Even if you don't have a “business,” you can still be eligible for business credit cards. Business credit cards frequently offer very high sign up bonuses. That's the case with the card I'm highlighting today.
Business Credit Cards with Best Welcome Bonus
This business credit card is offering the highest sign up bonus currently available on any card with only $5000 spend required. You can earn 80,000 points with only $5000 spend in the first 3 months of card membership.
These 80,000 points can be instantly cashed out for $800 cash.
Or, you can transfer the points to another great travel rewards card and then use the 80,000 points to book travel at 1.5 cents per point. Transferring makes the 80k points worth $1200!
But the best option is transferring the points to a hotel or airline partner, where you can earn 2+ cents per point. That makes the bonus worth at least $1600!
I've frequently earned over 3 cents per point on my airline transfers, so I could probably get $2400 of value from this card.
My wife opened this card earlier this year even though she is only a sole proprietor business. She had no problems with the application and earned the 80,000 points after 2.5 months of spending.
We transferred the points to United Airlines and flew first class from Honolulu Hawaii to Washington DC. It's a much better experience on the red eye flight when you can lie flat!
Do I need a business credit card for my small business?
I would recommend every business own getting a business credit card for your small business. It's important to separate out your personal and business expenses to make tax time easier.
Get A Free IRS EIN as a Sole Proprietor
If you want to be even more legit, you can file for an Employer Identification Number or EIN for free on the IRS website, even as a sole proprietor!
This gives you an extra number to put into the business credit card application, but it really isn't necessary. You will still need to put in your SSN in addition to your EIN.
I had an EIN as a sole proprietor and as an LLC.
Reply to this email if you have any questions about applying for business credit cards!