How to Handle Sales Tax Without a Bank Account When Starting a Company in the U.S.

Running a Business in the U.S. How to Handle Sales Tax Without a Bank Account

Handling sales tax is an essential and unavoidable part of starting or operating a business in the United States. However, some startups and freelancers may not yet have a formal bank account due to reasons such as limited credit history, identity issues, or unfamiliarity with traditional banking services. So, how can sales tax be handled legally and responsibly without a bank account? This issue not only affects business finances but also determines compliance with state tax laws.

Recently, tax authorities in multiple U.S. states have increased oversight of online sales and small businesses. For example, in July 2025, the California Department of Tax and Fee Administration FTB issued a notice reminding all individuals and businesses engaged in retail activities that they must legally collect and pay sales tax, regardless of whether they operate a physical store. This tightening of policy has posed new challenges for small business owners without a bank account.

The Basics of Sales Tax Are Not Tied to Having a Bank Account

It is important to understand that sales tax is based on the act of selling goods or services-not on whether you have a bank account. Most U.S. states impose sales tax on actual sales transactions, regardless of whether those sales occur through e-commerce platforms, physical stores, or social media. Even without a bank account, if you make sales within a state, you are generally required to register for a sales tax permit and file and pay taxes on time.

For example, in August 2025, Florida’s Department of Revenue announced plans to expand its sales tax collection from online sellers and encouraged small businesses to complete registration and reporting electronically. This means that even without a bank account, there are still alternative ways to fulfill your sales tax obligations.

How to Register for a Sales Tax Permit Without a Bank Account

Most U.S. states allow individuals or businesses to register for a sales tax permit online. While some states may request bank account information during the registration process for automatic tax payments or refunds, it is not always a mandatory requirement.

For instance, Texas and Arizona allow applicants to pay sales tax using credit cards, debit cards, or paper checks. Some states also offer alternative payment methods. Washington State, for example, allows taxpayers to make payments through third-party platforms like PayPal or credit cards. These options provide greater flexibility for business owners without a bank account.

How to Pay Sales Tax Without a Bank Account

Even without a bank account, you can still pay sales tax using the following methods

1. Credit or Debit Card Payments Many states offer online tax payment systems that accept credit or debit cards. While some may charge a small fee, this is a practical alternative.

2. Third-Party Payment Platforms Some states accept payments through platforms such as PayPal or Venmo with caution. Although not all states currently support this method, more may adopt it as digital payments continue to evolve.

3. Mailing a Check or Money Order If online payment is not an option, you can mail a paper check or money order to your state’s tax authority. While slower, this method remains valid.

4. In-Person Cash Payments Some states allow taxpayers to pay in cash at designated service centers or partner banks. This provides a direct option for those without digital banking access.

It is important to note that not having a bank account does not exempt you from sales tax obligations. In fact, it requires more careful planning of your tax process. It is recommended to research your state’s specific requirements when registering for a sales tax permit and choose a payment method that works for you.

Managing Cash Flow and Tax Records Without a Bank Account

Without a bank account, business owners must be especially diligent in managing cash flow and tax records. Consider using tools like spreadsheets or accounting software such as QuickBooks or Wave to track every transaction and calculate tax liabilities regularly.

It is also wise to set aside funds specifically for tax purposes and keep them separate from other business or personal funds. Some small sellers use prepaid debit cards to manage business finances. While not a full substitute for a bank account, prepaid cards can support basic financial management and online tax payments.

Conclusion

Sales tax is a fundamental tax obligation for any business operating in the U.S. Even without a bank account, this responsibility cannot be ignored. As tax enforcement becomes stricter, more states are offering flexible payment options to accommodate different business models.

For business owners without a bank account, the key lies in understanding your state’s specific rules and choosing appropriate alternative payment methods. By staying informed and organized, you can ensure timely and compliant tax reporting and payment.