If you’ve ever wondered how the best business credit cards work, and you’re a freelancer, sole proprietor or small business owner, then understanding the benefits of business cards could result in scaling your side hustle or company.
Do You Need to Have a Business to Get a Business Credit Card?
The short answer is yes, you need to have a business to be able to open a business credit card. Before assuming you don’t qualify, let’s define what a business is (you may already have one without your knowledge).
First, according to the IRS, you don’t necessarily have to have a registered business entity such as an LLC or corporation to count as one. There are different types of businesses, such as sole proprietorships and single member LLCs, so if you sell items on eBay or Etsy, or work as a freelance writer, you may be able to qualify for a business credit card.
The myth is that you need to have a federal tax ID (or EIN) to be able to apply for a business credit card. For some issuers of credit cards, you may be able to use your Social Security number instead if you put down that you’re a sole proprietor. Given that, you may not have access to higher credit lines unless you’ve been in business for a while and can prove you have a certain amount of income, but you can increase that over time.