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#21441 - 06/20/02 10:34 PM Less Cash deposits
Anonymous
Unregistered

Should a business account that is a DBA/Sole Proprietor be classified the same as a corporation where less cash back on a deposit is concerned? If the customer's name appears on the account(ie. John Doe DBA Doe's Hardware Store), and the TIN used is the customer's SSN, would it still be considered bad practice to give less cash on a deposit vs having the customer do a deposit and then write a check for the amount they wish to get back?

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General Discussion
#21442 - 06/20/02 11:49 PM Re: Less Cash deposits
Maria Offline
Platinum Poster
Joined: Apr 2001
Posts: 502
Sylacauga, Al, United States
I know people will disagree with my opinion here, but I do not believe in giving less cash back on any type of business accounts, although we do. I look at the ethics for one, of the business. If I was in business, I would want the audit trail. Are they trying to avoid paying taxes. If the account is used as a true business account, would they not need to document all the money going into it and out of it? Plus I think there is more risk involved for the bank and the customer, when the DBA customer has employees working for them that conduct the deposit and receive less cash back from the deposit. Especially if this employee is the same one that handles the DBA's books. I have seen this situation happen before with customers.

Opinions are mine not my employer

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#21443 - 06/20/02 11:51 PM Re: Less Cash deposits
rhurlbert Offline
Junior Member
rhurlbert
Joined: May 2001
Posts: 29
Spokane, WA
We would consider the Sole Prop. in the same light as an individual owner.
We take the position that we will give cash back on a deposit if we would have "cashed out" the checks being deposited. The individual that owns the Sole Prop. business is personally responsible for the debts and liabilities of the business so they can negotiate any checks made payable to the business.
Now, of course, this all depends on our recourse and how solid our customer's relationship is with the bank. We also usually recommend to the customer that for "good bookkeeping practices" they may want to deposit any checks made payable to the business.
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Washington State Banker

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#21444 - 06/21/02 03:59 PM Re: Less Cash deposits
Sponge Steve Offline
Gold Star
Sponge Steve
Joined: Jun 2002
Posts: 299
Midwest
My recollection is our policy is to have that business owner just write a separate check for Cash to get the petty cash they need.
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Sponge Steve, CRCM, CBA Opinions expressed are mine and not my employer's

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#21445 - 06/21/02 06:20 PM Re: Less Cash deposits
NHBankGuy Offline
Junior Member
NHBankGuy
Joined: Jan 2002
Posts: 35
Manchester, NH
This is really a matter of bank policy. Technically, the business IS the individual on a DBA, so there would not be any regulatory issues with giving cash back of which I am aware.

However, I do not think it is a good idea operationally. You put your tellers in a position where they need to make a distinction between DBAs/Partnerships/Orgs/Corporations when deciding whether cash back is allowable. I think the safest thing to do would be to require deposit of the full check if it is made out the the business and let the customer withdraw the amount they want back.
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Opinions are not necessarily those of my employer and should not be construed as legal advice.

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