Can I transfer money from my LLC to my personal account?
Asked by: Terrill Schneider | Last update: February 5, 2026Score: 4.5/5 (26 votes)
Yes, you can transfer money from your LLC to your personal account, typically as an owner's draw (or distribution) for single-member LLCs, or as salary/dividends for multi-member/taxed-as-corporation LLCs, but you must document it properly (e.g., as a draw in your books) and avoid commingling funds to maintain liability protection, which means not mixing personal/business expenses or misreporting them for taxes.
Can I transfer money from an LLC account to a personal account?
Single-member LLCs, for example, typically pay themselves by taking money out of the LLC's profits as needed. This is called an owner's draw. You can simply write yourself a check or transfer money from your LLC's business bank account to your personal bank account. Easy as that!
Is it illegal to transfer money from a business account to a personal account?
In most cases, transferring money from a business account to a personal account is not illegal. However, it has to be done properly and in line with your business structure and tax obligations. Business owners are permitted to pay themselves through draws, salaries, dividends, or reimbursements.
How do I legally pay myself from my LLC?
Here are your three main options:
- Owner's draw: This is the most common method for single-member LLCs. You simply draw money from the business profits as needed.
- Guaranteed payments: This method is often used in multi-member LLCs. ...
- Salary: If your LLC is taxed as an S Corporation, you can pay yourself a salary.
Can you use LLC funds for personal use?
Getting paid as a single-member LLC
However, you are not paid like a sole proprietor where your business' earnings are your salary. Instead, you are paid directly through what is known as an “owner's draw” from the profits that your company earns. This means you withdraw funds from your business for personal use.
LLC TIP How To Put Money Into Your LLC
What are common LLC mistakes to avoid?
Top 5 mistakes to avoid when forming an LLC online
- Choosing the wrong US State to register your LLC. ...
- Selecting the wrong entity type (LLC is not the only option) ...
- Overlooking the hidden costs and fees of running a US business. ...
- Forgetting about ongoing compliance. ...
- Using the wrong address for banking and legal notices.
Can I transfer myself money from my business account?
Once you've opened a business bank account, you can simply transfer money from this account to pay yourself. Remember to keep a record of these drawings, along with any other business incomings and outgoings.
How do I transfer money from my business account to my personal account?
Transfer the funds: The easiest way to transfer funds from your business account to your personal account is usually by using your bank's mobile app or website. Pay taxes (if necessary): Always make sure you know the tax implications of paying yourself and have money set aside for this purpose.
What is the biggest disadvantage of an LLC?
Profits Taxed Individually Each Year
One possible downside of an LLC is the obligation to pay taxes on earnings. As a member of an LLC, you must pay taxes annually on your portion of the company's profits regardless if those profits remain within the business.
Can I fund my LLC with my own money?
Fund your business yourself with self-funding
Otherwise known as bootstrapping, self-funding lets you leverage your own financial resources to support your business. Self-funding can come in the form of turning to family and friends for capital, using your savings accounts, or even tapping into your 401(k).
How much money can you transfer before it gets flagged?
The IRS reporting threshold: The $10,000 rule
But this rule isn't about taxing you — it's part of anti-money laundering laws designed to flag suspicious activity. If you transfer or receive more than $10,000, the bank automatically files a Currency Transaction Report (CTR) with the government.
Can an LLC gift money to an individual?
LLC owners can gift to multiple recipients each year while staying within tax-free limits. For example, an LLC owner with three children could transfer: $18,000 to each child annually without triggering gift tax.
Can I take money out of my LLC bank account?
Yes, you can withdraw cash from your business account, but it's not as simple as dipping into a piggy bank. The method and legality of the withdrawal depend on your business structure and how you document it. For sole proprietors or single-member LLCs, withdrawing cash is typically straightforward.
What is the best way to take money out of a limited company?
How to take money out of a limited company
- Paying yourself a director's salary.
- Issuing dividend payments from distributable profits.
- As a director's loan.
- Reimbursement of personal funds you've paid into the company or spent on business expenses.
Can I link my LLC to my personal bank account?
As the owner of an LLC, you're under no legal obligation to open a separate business bank account. Technically, you can use a personal bank account in your LLC, but it's ill-advised to do so. If you use a personal account, it's a lot more difficult to file taxes and could lead to serious complications down the line.
How to avoid commingling funds LLC?
Here are our top tips for separating your business and personal accounts:
- Establish a legal separate entity for your business. ...
- Know what counts as commingling. ...
- 3 Get a business credit card. ...
- Open a business checking account. ...
- Pay yourself regularly. ...
- Keep your receipts—and separate them. ...
- Track tax deductible expenses.
How much can an LLC write off?
New LLCs can deduct up to $5,000 of startup costs and $5,000 of organizational costs in the first year if total costs don't exceed $50,000. Qualifying expenses include state registration fees, legal fees to form the LLC, initial marketing, market research, business plan development, and accounting software setup.
What not to do with an LLC?
10 Things to Avoid Doing with an LLC
- Fraudulent conveyance of assets. ...
- Evading taxes. ...
- Choosing a bad partner. ...
- Ignoring the bureaucratic paperwork. ...
- Trademark infringement. ...
- Not creating an operating agreement. ...
- Not documenting company activities. ...
- Treating your LLC like a personal piggy-bank.
How does an LLC affect my personal credit?
Generally, an LLC does not affect your personal credit unless you personally guarantee a loan or credit line for the business. In those cases, if the business fails to repay, the lender can report late payments or defaults on your personal credit report.
Can I pay personal expenses from my LLC?
Do not pay personal personal expenses from your business account, or you may jeopardize the legal protection of the LLC. If you elect for your LLC to be taxed as a corporation, you'll need to pay yourself a salary, and withhold and pay payroll taxes.
Can I pay my mortgage from my business account?
You can however, take out money from your business account for personal expenses. Doing this cleanly depends on your entity: Sole Proprietor/LLC – You can make multiple draws from your account as needed for cash flow, but do not pay your mortgage, or anything else, directly from the business checking account.
Can you zelle from business to personal?
You can send or receive payments with other eligible small businesses or consumers when their bank offers Zelle® for their account type. The recipient must be enrolled with Zelle® with a linked domestic deposit account at a U.S. financial institution.
What is the best way to pay yourself from my LLC?
The best way to pay yourself from an LLC depends on the size and structure of your business as well as which benefits are most important to you. For example, paying yourself through a draw or distributions may be more beneficial for small business owners looking to reduce their tax burden.
Can I take money out of my business account to pay myself?
Paying Yourself Through a Single-Member LLC
You take an owner's draw from the business profits. Here's how it works: Transfer money from the business bank account to your personal bank account. You can write yourself a check or use an online transfer.
Can I take money out of my business for personal use?
You can withdraw money from a business account, provided you keep accurate records and repay the amount as soon as possible. If you don't keep accurate records, HMRC may treat any money not repaid as income, meaning it's subject to tax and National Insurance.