Banking Rules for Non-Profit Organizations


Taxpayer Identification Number

To open a bank account, the non-profit organization must first obtain a Taxpayer Identification Number, or TIN. To apply, fill out the TIN application on the IRS website. Barring any complications, the application can be approved online instantly. This TIN number must be listed on your bank account application.

Accounting of Funds

The bank account for the non-profit must be a separate account from the accounts of owners or managers. Clear records should be kept of all funds deposited into the account. Financial Accounting Standard No. 116 and Financial Accounting Standard No. 117 mandate that nonprofits maintain a balance statement, a statement of cash flow and a statement of functional expenses. All contributions to the account must be recorded before being deposited. Contributions must also be divided into restricted, non-restricted and temporarily restricted funds depending on the wishes of the donor. Any expenses must be reported according to the specific program or department that used the funds.

Bank Records

Non-profit organizations must keep their banking records on file in case they are audited. The IRS may audit non-profit organizations to ensure compliance with the rules for tax exemption. Your bank may keep these records automatically for your organization, but internal copies should be maintained for at least five years.


Nonprofits must submit a copy of their bylaws to their financial institution, which will keep the document on file. The bylaws must provide a clear summary of the purpose of the non-profit organization. Bylaws must name the president, vice president and treasurer and must be signed by all three parties. Board members should also be named in the bylaws. The bylaws should stipulate not only the goal of the non-profit organization, but also the board policies.


All authorized signers must be listed on the bank account. These signers must provide their names and social security numbers and they must put their signatures on file with the bank. The bank will usually require a written description of the non-profit’s check cashing procedures upon opening the account. The bank generally requires the president, the vice president and the treasurer to be listed among the authorized signers on the account.


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