Are LLC Bank Accounts FDIC Insured? | Know The $250k Cap

LLC deposits at an FDIC-insured bank are protected up to $250,000 per legal entity, per bank, in the business ownership category.

Your LLC’s cash is often doing five jobs at once: paying vendors, handling payroll, saving for taxes, handling refunds, and keeping the lights on. When a bank closes, deposit insurance decides what money you get back, and how soon.

FDIC insurance can protect LLC deposit accounts, but it is not “$250,000 per account.” It is a rule that depends on the owner shown in the bank’s records, the bank where the deposits sit, and the account ownership category the FDIC assigns.

What FDIC insurance protects for an LLC

FDIC insurance protects deposits held at an FDIC-insured bank. That includes common deposit products like business checking, business savings, money market deposit accounts (MMDAs), and CDs. It does not protect investments sold through a bank, even when you bought them at the same place.

If you want a plain source list of what counts as an insured deposit, the FDIC spells it out in Your insured deposits.

Deposits vs non-deposits

• Usually insured: checking, savings, MMDAs, CDs, and properly issued official items.
• Not FDIC insured: stocks, bonds, mutual funds, crypto assets, annuities, and the contents of a safe deposit box.

Some payment apps and fintech cash products park funds at partner banks. Insurance can still apply when the money is held as a deposit at an insured bank and recordkeeping supports “pass-through” ownership. Don’t assume. Confirm where the funds sit and what form they take.

Are LLC Bank Accounts FDIC Insured? What changes the answer

Yes, an LLC’s deposit accounts can be FDIC insured when the bank is FDIC-insured and the account is titled to the LLC. The real question is the insurance limit for your setup.

For business entities, the FDIC uses the ownership category for corporation, partnership, and unincorporated association accounts. Deposits owned by the same LLC at the same bank are combined and insured up to $250,000. One LLC, one bank, one cap—even if the money sits in multiple accounts for payroll, taxes, or projects.

The FDIC’s own rule page for this ownership category is here: Corporation, Partnership and Unincorporated Association Accounts.

How the $250,000 limit is measured for LLC deposits

FDIC insurance is calculated per depositor, per FDIC-insured bank, per ownership category. For an LLC deposit account, the depositor is the legal entity that owns the funds, not the person who can sign checks.

Three details decide most outcomes:

• Bank charter matters. Two branches of the same bank still count as one bank for limits.
• Account title matters. FDIC insurance is based on the bank’s deposit account records.
• Ownership category matters. Personal accounts and LLC accounts are typically insured separately because the owners differ.

If you want the FDIC’s plain-language overview of categories and limits, use Understanding deposit insurance.

Common LLC setups and what is insured

This table matches how FDIC insurance is grouped for most LLC deposit accounts: all deposits owned by the same LLC at one bank get added together.

LLC setup	How deposits are grouped	Insured result
One LLC checking account at one bank	All LLC deposits at that bank	Insured up to $250,000 for that LLC at that bank
Operating + payroll + tax accounts for the same LLC at one bank	Combined under the LLC’s ownership category	Still one $250,000 limit at that bank
One LLC with accounts at two FDIC-insured banks	Calculated separately at each bank	$250,000 per bank for the LLC
Two separate LLCs owned by the same person at one bank	Each LLC is a separate legal owner	Each LLC can have its own $250,000 limit at that bank
LLC deposits plus the owner’s personal deposits at the same bank	Different owners and categories	Personal deposits are insured separately from LLC deposits
LLC uses a fintech cash account with partner banks	Depends on deposit status and recordkeeping	Insurance can apply, but it must be verified
LLC holds cash in a money market mutual fund	Not a deposit	Not FDIC insured
LLC buys CDs issued by one bank, held in the LLC’s name	Counts as deposits at the issuing bank	Totals at that bank stay under the same $250,000 cap

Ways to reduce uninsured cash at one bank

If your LLC keeps more than $250,000 at one bank, the amount above the limit is uninsured at that bank. Many owners do not notice this until a large payment hits right before payroll or tax day. These steps help you stay in control.

Use more than one FDIC-insured bank

This is the cleanest lever because the $250,000 limit resets at each bank. If you hold $250,000 at Bank A and $250,000 at Bank B, both totals can be insured when each bank is FDIC-insured and the accounts are titled to the same LLC.

Double-check account titling and signer roles

FDIC insurance follows the owner shown in the bank’s deposit records. Authorized signers are not owners. If the bank’s system shows a person as owner, that balance can get grouped with the person’s other deposits at that bank.

Ask the bank to confirm the exact owner field on the account record. For an LLC, you want the LLC’s legal name as the owner, even when you use a trade name on checks and invoices.

Use a sweep program only when the details are clear

Some business cash products spread deposits across multiple banks behind the scenes. When structured correctly, this can raise insured totals because each participating bank provides its own limit. The details that matter are simple: which banks are used, how much is at each bank, and whether the program keeps records that show your LLC as the owner at each bank.

LLC details that can trip you up

These are the spots where owners often get surprised, even when they read the FDIC headline rule.

Single-member LLCs and tax treatment

A single-member LLC can be treated as a “disregarded entity” for tax filing. FDIC insurance is not based on tax classification. It is based on the account owner shown in the bank’s records and the ownership category applied to business entities. If the account is titled to the LLC, the LLC is the depositor for FDIC purposes.

Multiple locations or divisions inside one LLC

You can label accounts by store, department, or project. FDIC does not give extra insurance for divisions inside one legal entity at one bank. All deposits owned by the LLC at that bank are still combined under one limit.

Brokerage “cash” that looks like a bank balance

Brokerage accounts can show a cash number that is swept into bank deposits or held in a money market fund. FDIC insurance applies only to the portion placed into deposit accounts at insured banks. If it stays in a fund, FDIC does not apply. Read the sweep disclosure and confirm the bank list and the cash allocation method for business accounts.

How to check your insurance in one sitting

You can map your LLC’s insured and uninsured cash quickly if you keep it mechanical.

1. List each bank where your LLC holds deposits. Group by bank charter, not branch.
2. Add up all deposits owned by the LLC at each bank. Treat all the LLC’s deposit accounts at one bank as one combined total.
3. Compare each total to $250,000. Any amount above the limit is uninsured at that bank.
4. Confirm account ownership in the bank’s records. Ask the bank to confirm the owner field shows the LLC’s legal name.

If your structure is more complex, the FDIC offers a public calculator. It can help you spot where accounts get combined: Electronic Deposit Insurance Estimator (EDIE).

When your LLC keeps balances above the limit

Some businesses run large balances by nature: property firms collecting rent, ecommerce brands with large settlements, builders waiting on draws, and startups after funding. In these cases, treat deposit insurance like any other policy you manage: define the target, set a process, and review after big cash events.

Situation	Move	What to verify
Operating cash regularly sits above $250,000 at one bank	Keep a working cap at Bank A and move the rest to Bank B	Both banks are FDIC-insured and accounts are titled to the LLC
Large temporary balance after a sale or funding	Split deposits across banks or use a clear sweep program	Daily allocations and participating banks are disclosed
Owner wants to keep personal savings separate from business risk	Keep personal accounts titled to the person, LLC accounts titled to the LLC	Owner fields are correct in the bank’s records
Multiple entities exist for real business reasons	Keep deposits titled to the entity that owns the funds	Each entity has independent activity and separate records
Need a simple way to check totals after changes	Run EDIE after big cash movements	Account titles entered match the bank’s records
Unsure what is a deposit in a bank-branded app	Read the disclosure to find the partner bank and product type	Funds are held as deposits at an FDIC-insured bank

Takeaway checklist for safer LLC cash

• Make sure deposit accounts that belong to the LLC are titled to the LLC in the bank’s records.
• Add up LLC deposits per bank, not per account.
• Keep amounts above $250,000 at one bank as a deliberate choice.
• Use more than one FDIC-insured bank when balances sit above the limit.
• Re-check insurance after big cash events like payroll cycles, tax payments, loan proceeds, or a sale.