Money, sales tax and addresses · A term for founders abroad
What is an ACH transfer?
Automated Clearing House. The US network for bank-to-bank transfers inside the US, usually arriving in one to two business days, and how most US clients pay suppliers.
Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.
Term 4 of 105 in the glossary, filed under A.Every term, A to Z
ACH, for a founder abroad.
ACH is how money usually moves between US bank accounts: payroll, supplier payments, direct debits. A US client paying your company's invoice will almost always use it, from your account and routing number, and it usually arrives in one to two business days.
It works only between US accounts, which is why a US company needs US account details to be paid easily. It's free to receive at Mercury and Wise, and far cheaper than a wire for the payer. Money leaving the US to your account at home goes by wire or through Wise instead.
Read next · guide · 3 minMulti-member LLC taxes: Form 1065, the K-1, and what changes with two ownersWhat founders ask next.
- Can a US client pay my company by ACH if I live abroad?
- Yes, into the company's US account. Where you live doesn't matter to ACH; the account does.
- ACH or wire: which should I ask clients for?
- ACH. It's free or nearly so for both sides, while a wire usually costs the sender and sometimes you.
03 · See also
- Money, sales tax and addressesRouting numberThe nine-digit number that identifies a US bank for ACH and wire transfers; given with the account number so US clients can pay you.Read the term
- Money, sales tax and addressesSWIFT codeThe 8- or 11-character code that identifies a bank for international wires; what a payer outside the US needs to send dollars to your US account.Read the term
- Money, sales tax and addressesNexusThe link with a state that obliges a seller to collect its sales tax, created by a presence there or by sales above the state's threshold.Read the term
- Money, sales tax and addressesEconomic nexusSales into a state above its threshold, usually $100,000 a year, which makes a seller elsewhere collect that state's sales tax with no presence there.Read the term
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