Opening a Brokerage Account for Your LLC: A Practical Guide

Good Morning!

1. Feature: Opening a Brokerage Account for Your LLC: A Practical Guide 
   (4 min read)

2. From the Archive: Your LLC Is Missing Its Most Important Document.
   Read it here.

Hope your week’s off to a strong start—and if not, there’s still plenty of time to turn it around. Let’s make this Tuesday count.

-TCoL

Missed our last feature article? Should You Be The Registered Agent Of Your LLC? Read it here.

As an LLC owner—whether you run a single-member or multi-member business—you may have considered holding investments under your company’s name. The reasons are compelling: liability protection, potential tax deductions for investment-related expenses, and, for some, smoother estate planning.

Opening a brokerage account for your LLC isn’t complicated, but it does require more documentation and broker scrutiny than a personal brokerage or checking account.

This guide breaks the process into four steps, compares the top brokerage options for LLCs, and highlights common pitfalls so you can move forward with confidence.

Step 1: Prepare Your LLC Documentation

Before you even visit a broker’s website, make sure your LLC is fully compliant and that you have these documents ready:

• Articles of Organization (or Certificate of Formation) – State-issued proof that your LLC exists.

• Operating Agreement – Outlines ownership, management roles, and who can authorize investments. A single-member LLC can keep this simple; multi-member agreements should clearly define roles to avoid disputes. See our prior article: Your LLC Is Missing Its Most Important Document.

• LLC Resolution (or Corporate Resolution) – A formal document approving the brokerage account and naming who is authorized to act. Many brokers will reject your application without it.

• EIN Confirmation Letter – Your LLC’s “business SSN,” issued by the IRS (IRS SS-4).

• Beneficial Ownership Information – Required under federal FinCEN rules for anyone owning 25% or more. Include names, addresses, dates of birth, Social Security numbers, and ID copies. Most brokers require signatures from these owners during the application process; others only need their details.

• Government ID for Authorized Signers – Driver’s license or passport.

• Proof of Business Address – Not all applications require it, but a utility bill or lease agreement usually will suffice.

Single-member LLCs: You handle everything yourself.

Multi-member LLCs: All members or managers must approve the application, per your company resolution or Operating Agreement, and 25%+ owners must supply personal information.

Pro tip: Scan everything and save it digitally. Most brokers allow secure uploads, and complete documentation can cut processing time from a week to just a few days.

Step 2: Choose a Brokerage That Supports LLC Accounts

Not all brokers make it easy for LLCs to open accounts, so choose one that has a smooth process and understands business compliance. Below is a comparison of five top companies:

What to Watch For

• Accessibility: All standard business accounts have effectively $0 minimums. Schwab’s $250k “minimum” typically applies to wealth management services.

• Fees: Commissions are $0 for stocks and ETFs but expect options contract fees (~$0.65) and wire fees ($10–$25).

• Investor Protection: All offer SIPC coverage ($500k, including $250k for cash).

• Best Overall for SMBs: Fidelity combines low cost, easy setup, and robust research, making it ideal for first-time LLC investors.

Step 3: Apply and Open the Account

Once you’ve selected a broker:

1. Complete the Online Application – Takes 10–30 minutes. You’ll enter your LLC name, EIN, address, authorized signers, and beneficial owners (25%+).

2. Upload Documents – Articles of Organization, Operating Agreement, EIN letter, and resolution are standard.

3. Verification – Expect a review period of 1–5 business days. Multi-member LLCs may require all authorized signers to e-sign.

4. Fund the Account – Use an LLC-titled bank account. ACH transfers are free but take 1–3 days; wire transfers cost $10–$25 but clear the same day.

Step 4: Manage the Account and Stay Compliant

A brokerage account under your LLC is a business asset—treat it that way.

• Never Mix Personal and Business Funds – Commingling increases the risk of losing LLC liability protection.

• Keep Records Updated – Amend your Operating Agreement if members change and update beneficial ownership information with your broker.

• Invest According to Purpose – Keep capital reserves conservative; investments should align with your stated investment objectives and Operating Agreement.

• Plan for Costs – Expect $0–$50 annual account fees (often waived) and $50–$75 transfer-out fees if you move assets.

Final Thoughts

If you’re ready to build business wealth while maintaining liability protection, choose a broker that understands LLC compliance. Fidelity is ideal for simplicity, while Interactive Brokers caters to active or international traders. 

Most applications are free and can be funded as soon as approval is complete.

Have an interesting business question and need a free bit of advice? Send your question to [email protected]. No confidential info, please!