We Are the Business! Now Deposit Our Check!
Answer by Randy Carey, BOL Guru Guru Bios
Question: We have a customer with a jtwros account. They are farmers and also own a small trucking business. Most of the time the checks deposited are made payable to them personally. Once in a while, they have a check made payable to their trucking company. We have told them they can't deposit them into their account because they are made payable to a business. They said they are the business and as long as their last name appears in the title, it is legal and they are adamant about it. Are they correct?
Answer: Is the trucking business a sole proprietorship? If it is, the business and its owner(s) are one person. It would be legal for the owners to endorse the check in the name of the business, and then as individuals, and deposit it to their account. It would even be permitted under the UCC for checks payable to the business to be endorsed to the individuals if the business is a partnership of those individuals, but in neither case is your bank obligated to accept these checks for deposit to the individuals' account. That's not a UCC issue. It's a business decision for the bank.
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