Since I started my small business in 2007, I’ve used a business credit card for several reasons. First, it helps keep business expenses separate from personal expenses. I use GoDaddy’s online bookkeeping tool, which automatically imports all of the charges from my business credit card. Second, it helps my company build credit should I ever need to apply for a loan. And third, it makes preparing my tax returns at the end of the year much easier.
That being said, there are some that don’t like business credit cards. Clark Howard, for example, thinks they should be avoided because they don’t offer the same protections as personal credit cards. While that’s true from a regulatory perspective (The Credit Card Act of 2009 doesn’t apply to business cards), most of the major card issuers incorporate many of these protections in their terms and conditions.
Picking a card that is best for you business can be a challenge. There are a number of business credit cards to choose from, all with different benefits, rewards and fees. One key to making the right choice is to understand how you’ll use your card. If you know the types of expenses (e.g., office supplies, gas, travel) you’ll charge to the card, choosing the right card will be a snap.
With that, here are some good options from the major credit card issuers:
U.S. Bank Business Edge™ Cash Rewards Card: The card offers 3% cash back on all cellular, gas and office supply store net purchases, and 1% cash back on all other net purchases. You also get a 25% annual cash rewards bonus, up to $250. There is no annual fee.
U.S. Bank FlexPerks® Business Edge™ Travel Rewards Card: You get 20,000 bonus FlexPoints after the first $3,500 in net purchases in the first 4 months. Award travel starts at 20,000 FlexPoints (up to a $400 ticket value) on over 150 airlines with no blackout dates or online redemption fees. Earn one FlexPoint for every $1 spent in net purchases and earn double FlexPoints on the category you spend the most on (gas, office supplies or airline) and most cell phone expenses during each billing cycle. You even earn triple FlexPoints on qualifying charitable donations. There is no annual fee the first year and $55 per year thereafter (+$10 for employees).
Capital One offers the Spark line of business credit cards. Each of these cards is worth considering. I’ve used the Spark Miles for Business card for years. It offers 2 miles for every dollar spent on all purchases. The miles are worth the standard penny if used for travel. It’s very easy to apply the miles to travel expenses charged to the card. There is an annual fee after the first year.
Chase offers the Ink line of business cards. Like Capital One, these offers some of the best rewards you’ll find anywhere. My personal favorite is the Ink Plus. It offers 50,000 bonus points after you spend $5,000 on purchases in the first 3 months after account opening. You also earn 5X points per $1 on the first $50,000 spent in combined purchases at office supply stores and on cellular phone, landline, internet and cable TV services each account anniversary year; Earn 2X points per $1 on the first $50,000 spent in combined purchases at gas stations and hotel accommodations when purchased directly with the hotel each account anniversary year; and 1x on everything else. There is an annual fee for this card.
Amex offers a number of business cards, some under different brands. The Amex branded cards include the Business Platinum, Gold and Simply Cash. Of these I like the Simply Cash card best. It offers 5% cash back at U.S. office supply stores and on wireless telephone services purchased directly from U.S. service providers. The 5% applies to the first $25,000 in annual purchases. All other purchases earn 1%.
For frequently travelers, American Express also offers the Starwood card and a series of Delta SkyMiles options. Finally, there is the TrueEarnings business card for those that shop frequently at Costco.
Citi offers the AAdvantage line of cards for those that travel frequently on American Airlines. With this card you can earn 50,000 bonus miles if you satisfy a minimum spend requirement.
Bank of America
Finally, BofA offers some good business cards, including its Cash Rewards for Business MasterCard. With this card you earn 3% cash back on gas and office supply store purchases, 2% at restaurants, and 1% on all other purchases.
If you know of another business credit card offer, please let us know about it in the comments below.