Many people know that personal checks expire after a given length of time; however, there is less clarity when it comes to the world of business checks. A personal check generally expires 180 days after the date it’s written on, but corporate checks often have shorter timeframes before they become invalid. Many businesses use corporate checks as a security measure since an authorized signature is required in order to pay out funds, as opposed to digital payment systems that can have a username and password compromised. If you are a business owner or are seeking clarification about the ins and outs of corporate checks, read on.
Does my corporate check expire?
The longer it takes before a check is void will vary from company to company. Determining when your corporate check expires is generally up to the business issuing the check. Even so, some business checks may be able to be cashed as long as six months after the check has been cut. In these instances, it is important to discuss this issue with your bank, as bounced checks sometimes carry along both penalties or fees.
If you’re struggling to figure out how long your company’s limit should be, a general rule of thumb involves segmenting payroll checks from checks written for other business purposes. Limiting general business checks to 90 days and payroll checks to 60 days can be an effective way of managing expectations without unnecessarily overextending your company’s accountants. This ensures that your accounting can stay more current, as you don’t run the risk of overdrafting a check that you forgot you wrote several months prior.
How do I know if my corporate check has been cashed?
One of the best ways to monitor all of your business’ financial and checking needs is via software such as Quicken, Microsoft Money, or Quickbooks. Many corporate check suppliers, such as Check o Matic, offer corporate checks that integrate with these pieces of software, for streamlined, efficient accounting. This system of accounting allows business owners to quickly search, find, and monitor which checks have cleared, as well as what checks are outstanding. Thus, syncing your paper checks with a piece of software can be invaluable when it comes to managing your corporation’s expenses.
What should I do if my corporate check hasn’t been cashed and is nearing its expiration date?
It’s understandable to be concerned if you’ve written a business check that has yet to be cashed and is close to expiring. For one, it can be a hassle for your finances to not be up-to-date. Additionally, the possibility of bounced check fees is something no business owner wants to risk. If you’re tracking outstanding checks and have noticed that an employee or contractor has yet to cash your check, the best thing to do is reach out to them to make sure there isn’t an issue with the check. Sometimes, people misplace checks, and getting to the bottom of the issue sooner than later can save you unnecessary expenses as well as a major accounting headache. Again, this is a benefit of integrated your corporate checks with digital software like Quickbooks.
Business checks can be customized with your company’s logo, address, and security features that make them stand out and lend an air of professionalism to your organization. However, since business checks can expire, it’s important that your business understands how to best use them for making payments. Implementing some common sense policies such as setting reasonable expiration dates and following up on checks that have yet to be cashed can be a major boon to your financial accounting.