Accepting Credit & Debit cards

[Roberts]

It is not illegal to charge an additional fee on a credit card transaction, especially if the amount of the additional fee is reasonable, and bears a legitimate mathematical relationship to the additional expense incurred.

And for most small businesses, I do not believe that it is a violation of the terms of service of PayPal, or Square, or GoPayments, or most other similar services.

If you have a genuine merchant account, where your financial institution has you wired directly into the MasterCard/Visa system, and you get the funds the same day, then you may have a contractual agreement with MasterCard and Visa that has some additional baggage. It could be buried in the fine print.

Illegal? No. Every one of the services I've seen prohibit it though as part of the agreement you sign. This is why businesses sometimes give a discount for paying in cash and don't charge a fee for the credit transaction.

I accepted credit cards for 2 years and found it wasn't worth the cost and headache. I don't think I've had a single prospective client that has been lost due to not accepting credit cards.

[dtlee]

Just to clarify, I am not sure that it is always permissible to charge a fee for using a credit card. It is my understanding that California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma, and Texas all prohibit add-on fees for using a credit card.

However, to muddy the waters, I believe all of these states allow a discount for cash (which must be offered to all customers, not just those who want to pay with a credit card).

[Possi]

ITransact

I use ITransact through Taxwise and it has saved me a bundle in the long run. It's only $5 a month plus a very low % of sales, I think 2%.

All the information is directly input in the computer and never written down. Both I and the client get an instant email verifying the charge.

The fees are so low that I do not have to charge extra to my clients. ITransact will also allow me to suspend the service when it's not tax season. I did that once and regretted it. Seems the late clients are also the hardest to collect from!

[joanmcq]

OceanlovingEA has pretty much told my story; and after I had a youngish client (late 20's) look at me blankly when I said 'check' and he had to run to the ATM to get cash, I got the Square account and then set up Paypal with a link on my website. Since I am doing so many returns remotely this year, it has been a boon not to have to wait for a check in the mail. Most of my local clients pay by check, but it is nice to be able to whip out the little Square doohickey when they forget their checkbook.

If more clients start using debit/credit cards, I may look into the cash discount or just raising my fees across the board (which I need to do anyways).

[Lion]

Oh yeah, the link to PayPal is on the opening page of my web site.