Answer by Sonja Kriegsmann: The two businesses are separate entities. The buyer of the business - new business owner - should open an account providing all of the required and necessary paperwork. The seller of the business should write a check to the buyer if there are funds that the seller must pay the buyer according to the arrangement and agreement to sell the business. It is important, both for the business owners and the bank, to keep the entities separate so there are no questions about responsibility for items that are returned, items to be paid, etc.
Answer by John Burnett: On the other hand, if the sale is a transfer of the stock of a corporation that is 100% owned by Sam Jones to Jerry Smith, the corporation continues to exist, and from the bank's perspective there is no change in ownership of the account itself. There will normally be a new governing board of directors and new management, and the board of directors will authorize a new slate of individuals to sign on the account.
The key is knowing whether a new business is indeed being formed.
Answer by Ken Golliher: As indicated, there is an array of possible answers. You may want to re-post your question and indicate whether the "business" is a sole proprietorship or an entity. If it's an entity, please indicate whether the purchaser bought the entity or just the entity's assets.
The rule of thumb is: If you have a new "customer," you need a new account.
First published on BankersOnline.com 7/1/13