The American Banking System: A Guide for New Immigrants
If you plan to live in the United States permanently, there are some things you will need to do as soon as you arrive, if not before. If, for example, you don’t have a job yet, you will need to find one. And with this new income, you’ll need somewhere to put your money, which means you’ll need to open a US bank account.
With a bank account in place, you will be able to do things like:
- Set up direct debits for rent and utilities
- Access funds without having to transfer money
- write checks
- Use financial apps like Mint.com
In this article, we’ll cover the basics of setting up an account at a US bank, how to write a check, and how to schedule automatic withdrawals.
Opening an account
US banks generally allow non-US citizens to open an account, but may not grant the same permissions to someone who fails the green card test or the substantial presence test. If you have a green card then you are in the clear. Otherwise, you will likely need to pass a substantial presence test.
To pass this test, you must have lived in the United States for:
- 31 days in the current year, and
- A total of 183 days in the last 3 years, i.e. the current year plus the previous two years. To tally this total, you can count all the days you’ve lived in the United States in the current year, but only ⅓ of the days in the previous year and ⅙ of the days in the previous year.
For a more detailed explanation, see the Internal Revenue Service (IRS) website.
To be clear: it may still be possible to open an account even without a green card (or any documentation, for that matter). You will, however, need to have an Individual Taxpayer Identification Number (ITIN) and a US address, at a minimum. Ultimately, you’ll want to contact the bank to see what their policy is on this.
If you think you are eligible, you will need to gather certain information and documents to open an account. These generally include:
- Cash deposit: anywhere between $25 and $100
- Your name, telephone number and address(es)
- A social security number (SSN). If you don’t have an SSN, you can choose to use an ITIN
- Declaration of utility containing the address in the United States
- Two forms of government-issued identification. Examples include:
- Your passport with the visa inside
- Driver’s license, US or foreign
- U.S.-issued work identification card
- Retail credit card
This is only a general list, and different financial institutions may have different requirements, so be sure to call ahead. If you don’t have a green card or social security number, you may need to go to the physical bank rather than applying online. But, again, the requirements vary depending on the financial institution.
If you’re eligible for a Social Security number but haven’t yet, read our guide on the subject to learn more about the process.
Request an ITIN
To request an ITIN, you will need to submit IRS Form W-7, your immigration status documents and proof of identity, and your federal tax return. You can use one of the following options to apply:
- Submit by US Mail to the Austin Service Center (see below)
- Apply in person with an Authorized Certification Acceptance Agent
- Attend an appointment at an IRS Taxpayer Assistance Center
If you are submitting by US mail, you can send your documents to the following address:
Internal Revenue Service
Austin Service Center
Austin, TX 78714-9342
Once you have successfully obtained an ITIN, you will not need to repeat this process again. You can file your tax return according to the normal filing instructions.
write a check
To write a check in the United States, you must fill in all the appropriate spaces. In the next section, we’ll explain how to write a check, working from top to bottom.
- Write today’s date. It is important for the bank to know when the check was cleared. There is a difference between a check written in 1986 and one written last week.
- Specify the recipient of the check.You will want the bank to know who this check is for. You can write the name of the person (or company) on the line next to the phrase “Pay to order of”.
- Fill in the amount using numbers. After writing the recipient’s name, you should find a box to the right with a dollar sign next to it. Write the numerical amount – $50.30, as opposed to “fifty dollars and 30/100” – in this box.
- Fill in the amount using words. On the next line you will need to write the amount with words – “Fifty dollars and 30/100”, as opposed to $50.30. Even if you write an even amount in dollars (without the cents), you must still include the fraction. So if you write a check for $50.00, you should always write “Fifty dollars and 00/100”.
- Include a memo. At the bottom of the check, you should see a section titled “memo.” Here you have the possibility to write the subject of the check. If, for example, the check is for rent, you can write “Rent for August”.
- Add your signature. Finally, on the remaining line, you will need to sign your name, indicating to the bank that you agree to pay the amount indicated above.
Once the check is completed, you can give it to the recipient, who should then be able to cash it at their financial institution.
Setting up automatic withdrawals
Having a US bank account will allow you to set up automatic payments for all recurring (or one-time) bills. If you’re setting up direct debits through your bank, you’ll need the relevant payee information, including address and account number, which you’ll usually find on the most recent bill. If you are using the recipient’s website to set up the transaction, you will need to provide your account and routing numbers.
Where to find these numbers? You can simply view your checks. Each check should contain the routing number (which identifies the bank), your account number (which specifically identifies your bank account), and a check number (which helps you track the number of checks you have issued).
Each number will be written successively at the bottom of the check. The routing number is the first, bottom left, and consists of 9 digits. The other numbers will be on the right, although they can be in any order. Just be aware that the account number is the longest.
Remember that every financial institution is different, so you will need to do your research beforehand. The bank’s website is usually a good place to start. They will usually have a help section with a list of questions or topics to guide you. Alternatively, you can call the bank directly, although you may have to wait to speak to a representative.
If you are considering moving to the United States, but are having difficulty getting started, contact Boundless today.