Opening a US Bank Account on a J-1 Visa: IDs, SSN and the $10,000 Rule

A US account turns a paycheck into something you can spend, send home and plan around. Your sponsor’s pre-arrival information can cover how to open a bank account. The money hub has the rest of the finance steps, and the tax return page explains why you may want the account open into the next year.

The short version

1. Ask your employer, roommates or coworkers which bank they suggest.
2. Check that the bank is insured by the FDIC.
3. Compare monthly fees, free ATMs and direct deposit.
4. Bring original IDs that have not expired.
5. Ask the bank how to close the account before you leave the US.

Can a J-1 participant open a US bank account?

Yes. Federal rules set the minimum a bank must collect, and they do not require a US citizen or an SSN. Before opening an account, a bank must obtain a name, a date of birth, an address and an identification number. For an individual, the address is a residential or business street address.

For a non-US person the identification number can be one or more of these: a taxpayer identification number, a passport number and country of issuance, an alien identification card number, or the number and country of issuance of another government-issued document that shows nationality or residence and carries a photograph. A bank must also give customers notice that it is requesting information to verify identity.

Banks use unexpired government-issued photo ID, such as a driver’s license or passport, to verify identity. Verification happens within a reasonable time after the account is opened. The federal rule for bank customer identification is 31 CFR 1020.220.

For InterExchange participants, a host organization that pays them will likely require a US bank account for direct deposit.

Choose a bank

Start with the people closest to the job. Ask your host employer which bank it prefers for direct deposits, then roommates, host family or coworkers (InterExchange’s advice to its J-1 participants). Most J-1 participants need only a basic checking account, and most are free to open; a savings account can help you budget by putting some money aside (InterExchange’s guidance).

Check the bank is insured before anything else. FDIC deposit insurance protects deposits at FDIC-insured banks if the bank fails. You can check a bank with the FDIC’s BankFind Suite tool.

Then compare costs. Ask what balance you must keep to avoid fees. Questions worth asking the bank:

• Is there a monthly fee, and can it be waived?
• Is direct deposit available, and does it remove the fee?
• Are free ATMs near where you live, work or shop?
• What happens if you spend more than you have, called overdraft?
• Are there alerts when your balance gets low?
• What do you need to know about closing the account before you leave the US?

InterExchange recommends avoiding a minimum opening amount or daily balance, and avoiding a maintenance fee. For how much to keep in the account, see the budget page.

What to bring to the bank

Check the bank’s requirements online before you go, as InterExchange advises. The table shows what four sources ask for. Bank of America and Chase describe their own requirements, not a rule for every bank.

Bank of America lists primary ID examples, among them a foreign passport with or without a US-issued visa and an employment authorization ID with photo. Secondary ID examples include a US student ID validated for the current term, and a debit or credit card with a Visa or Mastercard logo.

Bring originals. Chase’s guide says many banks do not accept screenshots or copies of IDs, and advises checking that your IDs are valid and not expired. InterExchange notes some banks ask for a lease or something showing your local address, like a utility bill. Chase lists an employer ID with photo, a student ID with photo or a utility bill with your name and address as alternative secondary ID.

Nonresident customers at Bank of America give a physical foreign address and a US mailing address. A resident alien gives a physical US address. Citizens of countries under US economic or financial sanctions must also provide proof of US residency.

Account holders usually must be present themselves. At Chase, the account holder typically must be present to open the account, though students generally do not need to have their parents present to open a checking account.

SSN or ITIN: do you need one?

Not always. The federal customer identification rule accepts a taxpayer identification number, a passport number or an alien ID card number from a non-US person. A bank may even open an account for a customer who has applied for a taxpayer identification number but has not received it. It must then obtain the number within a reasonable period after opening.

Chase’s own guide says non-US residents may be able to open an account at some institutions without an SSN. Bank of America accepts a foreign tax identification number as well as an SSN or ITIN.

The catch is interest. To open an interest-bearing account you need an SSN or ITIN, and without one you may be able to open only a no-interest account. The Social Security number page covers the application.

Opening deposit, fees and the first card

You usually need an initial deposit between $25 and $100 to open a savings or checking account. Some banks require as little as $5, and some none. At Chase you may not need to deposit when opening, but you must add funds before using the account.

At Chase, a debit card typically arrives in the mail about a week after opening, and you can typically request a new one online if it has not come within two weeks. InterExchange advises keeping the bank’s phone number handy to report a lost card, and never sharing your PIN, even with your employer.

If a checking account lacks the money to cover a purchase, Chase notes you may be charged an overdraft fee. InterExchange also lists bounced checks as a cost to avoid.

Getting paid: direct deposit

Direct deposit is how a company sends payroll to the account an employee designates. For InterExchange participants, only the employer, for direct deposit, needs your account number and routing number, and the employer never needs your PIN.

Chase’s guide puts international wire transfers at generally 1-5 business days, and transfers between different US banks at 2-3 business days, with a fee at some banks. Bank of America charges no outbound wire fee for a wire in foreign currency, though exchange rate markups apply. See sending money home for the route back.

What is the $10,000 bank rule?

Banks report cash transactions of more than $10,000. Each financial institution files a report of each deposit, withdrawal, exchange of currency or other payment or transfer that involves currency of more than $10,000. Federal law requires reports of cash or coin transactions over $10,000 by or for one person, and of several transactions that add up to over $10,000 in a single day. The reports are Currency Transaction Reports.

The rule exists to guard the financial industry from money laundering and other financial crime. It does not forbid handling large amounts of cash, and the report is required whatever the reason for the transaction. The FinCEN guide to CTRs explains it for customers.

Do not split cash to dodge it. Breaking up transactions to evade the report is called structuring, and federal law makes it a crime. Structuring can bring up to five years in prison and a fine of up to $250,000.

Is your money safe?

Deposits are insured at FDIC-insured banks: at least $250,000 per depositor, per ownership category, at each insured bank. All your deposits in the same ownership category at the same bank are added together. Your checking and savings accounts at one bank count together toward the limit. Insurance covers deposits only, and not investment products, even those sold by an insured bank. Use the FDIC deposit insurance page and its calculator to check your cover.

Before you leave the US, ask the bank how to close the account, as InterExchange advises. If you expect an IRS refund by direct deposit, the tax return page explains why the account needs to stay open until it arrives.