Stripe Account Verification: A Step-by-Step Guide

PLLC and LLC can have single-member or multi-member ownership (you and other licensed professionals). S Corporations also support single or multi-member ownership. Sole Proprietorship is exclusively single-owner using your personal name and Social Security number as tax ID. After forming PLLC, LLC, or S Corporation, you must obtain an Employer Identification Number (EIN) from the IRS online for tax filing purposes. Each business type has distinct ownership flexibility and identification requirements that affect how you structure and operate your private practice.

A sole proprietorship has no distinction between owner and business, meaning personal assets are not protected from business lawsuits. LLCs separate business from personal assets and liabilities, with single-member LLCs taxed like sole proprietorships. Corporations are completely separate entities that pay taxes at the business level with a 21% rate. An S-Corp is not an entity type but a tax election that LLCs and corporations can choose. Pass-through entities (LLCs and S-Corps) file informational returns where income passes to personal taxes, while corporations pay taxes at the business level with no pass-through.

In the United States, business owners can choose from five main entity types: (1) Sole proprietorship - for single owners who haven't filed any paperwork, where the IRS treats the owner and business as one entity, requiring Schedule C filing with personal tax returns; (2) Partnership - for two or more persons entering business together, which can be general, limited, or limited liability partnerships, requiring Form 1065 and with profits flowing to partners' personal returns; (3) C corporation - the default corporate type created by filing articles of incorporation, which faces double taxation (corporation taxed on profits, shareholders taxed on dividends) and files Form 1120; (4) S corporation - elected status for corporations using Form 2553, avoiding double taxation through flow-through taxation but limited to 100 shareholders and certain eligibility requirements; (5) LLC - a flexible entity providing limited liability protection (shielding personal assets from business debts) that can be taxed as a sole proprietorship (single member) or partnership (multi-member), requiring state registration but no specific federal tax form.

When choosing a business structure, informal structures like sole proprietorships and partnerships are simple and suitable for testing ideas with familiar clients but offer no asset protection; formal structures like LLCs and corporations provide personal asset protection and business credibility, with LLCs being simpler and offering pass-through taxation while corporations allow for easier fundraising and tax year money carryover, and LLCs can choose between default pass-through taxation, S-Corp status for potential tax savings, or C-Corp taxation depending on business needs and profit levels.

When applying for an Employer Identification Number (EIN) through the IRS online system, business owners must select their legal entity type (such as LLC, corporation, partnership, or sole proprietorship) and answer questions about business activities, employee status, and tax classification; the IRS will then assign an EIN which serves as the business's tax identification number, and it is crucial to save the confirmation letter as it outlines required tax filings and helps avoid penalties for inactive businesses.

This section covers the foundational regulatory framework for KYC (Know Your Customer) and AML (Anti-Money Laundering) compliance in Indian banking. The Reserve Bank of India imposes monetary penalties for non-compliance under Section 47A1C read with Section 4641 of the Banking Regulation Act 1949. RBI issues KYC, AML, and CFT guidelines under Section 35A of the same Act. FATCA (Foreign Account Tax Compliance Act) is mandatory for all account types including savings accounts. VCIP (Virtual Customer Identity Process) enables remote customer identification through audio-visual interactions. E-documents are electronic equivalents of documents with valid digital signatures. Digital KYC involves capturing live customer photos with OVD and location coordinates. Risk perception for vulnerable customers like blind individuals and women wearing purdah is classified as medium risk.

This video provides a comprehensive overview of AML (Anti-Money Laundering) and KYC (Know Your Customer) compliance requirements for banking examinations, covering key regulatory frameworks including PMLA (Prevention of Money Laundering Act), RBI guidelines, and international standards. The content explains critical concepts such as at par check issuance rules (walk-in customers up to 50,000 rupees, KYC-compliant account holders for 50,000+), pool account requirements for regulated entities, monetary penalty ranges under PMLA Section 13 (10,000 to 1 lakh rupees), and the distinction between CTR (Cash Transaction Report, monthly by 15th) and STR (Suspicious Transaction Report, within 7 days). The video also covers money laundering techniques like smurfing (structuring deposits below reporting thresholds), back-to-back loans, and the roles of key regulatory bodies including FIU-IND (established 2004, reports to Economic Intelligence Council), FATF (39 members as of 2025), and Wolfsberg Group (13 global banks).

The Prevention of Money Laundering Act (PMLA) 2002 establishes comprehensive anti-money laundering and counter-terrorist financing regulations, requiring financial institutions to implement Know Your Customer (KYC) procedures, maintain transaction records for 5 years, report suspicious transactions exceeding thresholds (₹10 lakh monthly aggregate, ₹50 lakh real estate, ₹7 lakh cross-border transfers), and conduct due diligence based on customer risk levels (high-risk every 2 years, medium-risk every 4 years, low-risk every 8 years). The Financial Action Task Force (FATF) categorizes countries into black-listed (high-risk) and grey-listed (increased monitoring) jurisdictions, with updates occurring quarterly in February, June, and October. Banks must maintain records of all transactions, including attempted transactions, and report to the Financial Intelligence Unit (FIU) through the FinGate portal. The Act takes precedence over other laws including the Indian Penal Code, and penalties for non-compliance range from ₹10,000 to ₹1 lakh.

Anti-Money Laundering (AML) and Know Your Customer (KYC) are essential banking compliance frameworks under the Prevention of Money Laundering Act (PMLA) 2002, which came into effect on July 1, 2005. Banks must implement KYC procedures including customer acceptance policies, risk management, identification procedures, and transaction monitoring to prevent money laundering and terrorist financing. Banks are required to maintain transaction records for 5 years, classify customers into low, medium, and high-risk categories, and report suspicious transactions to the Financial Intelligence Unit (FIU-IND). Key obligations include obtaining valid identification documents (Aadhaar, PAN, or other government-issued IDs), conducting periodic customer identification updates, and reporting cash transactions exceeding 10 lakh rupees or cross-border transfers above 5 lakh rupees.

This comprehensive section covers the complete RBI KYC and AML regulatory framework. Customer Due Diligence (CDD) is required during account opening, large transactions, and when money laundering suspicion exists. KYC updates are risk-based: high-risk customers need more frequent updates, low-risk need less. Suspicious Transaction Reports (STR) are submitted to FIU-IND. AML objectives focus on preventing money laundering and detecting suspicious transactions, not profitability. KYC includes customer identification, identity verification, address verification, and biometric verification, introduced under PMLA 2002. All account types require KYC compliance. The framework encompasses customer identification, risk management, and transaction monitoring to prevent financial crimes.

Bank account information is the most critical part of the EFT form. Required fields include: (1) Bank Name - the name of the bank where the account is held; (2) Routing Number - can be obtained by visiting the bank account or searching online with the account details; (3) Account Name - must match the name on the NID and the bank account, written in capital letters; (4) Bank Account Number - the online account number, which can be 10 or 13 digits. The form requires the teacher's signature and the institution head's signature for submission.

For electronic funds transfer, applicants must confirm they are bank account owners and provide bank information including the financial institution name, routing number, and account number. Routing and account numbers can be found at the bottom of paper checks, or through online banking or mobile banking platforms.

To perform an electronic fund transfer, you need specific beneficiary information including the beneficiary's name, address, and country; the beneficiary's account type; the beneficiary's account number; the beneficiary bank name; and the beneficiary bank's EFT routing number. These details ensure accurate fund delivery.

The video explains that Electronic Funds Transfer (EFT) is exactly what it sounds like - transferring information electronically. The video explains that money orders were designed to send information to banks, which would type the routing number and account number into their computer systems to process payments. The video notes that people have been ordering banks to do EFTs without telling them directly, because they knew the banks' policies.

ABA (American Bankers Association) numbers are routing numbers assigned to American banks, used for ACH transfers. ABA and routing numbers are essentially the same thing. To set up Interactive Brokers as a recipient, users need: company name (Interactive Brokers), address, city, postal code, state, routing number, and account number. These details are obtained from the IB payment instructions. The presenter demonstrates copying these details from IB's payment section and entering them into TransferGo's recipient form.