Firm Administration - Credit Cards

[BMW CPA]

In looking over some of the message board threads - it seems we all have the same problems of getting clients to pay. Anyone accept credit cards? In your opinion - is it worth the high fees charged? Our office manager is extremely skeptical - but our A/R is growing. Our firm has been around for 30 yrs and never done this before -so we are dealing with 'old guard' vs 'new guard' issues! Would love to hear some feedback on this topic.

[Bees Knees]

The tax firm I worked for before Mr. BIG bought us out use to accept credit cards. I always had to waste 20 minutes trying to figure the thing out if I was the one caught up at the front desk when clients came to pick up their return. It works slick. Just make sure everyone knows how to use the authorization thing since there will be times the receptionists will have already left for the day and you are stuck looking like an idiot because you can’t figure it out.

Of course, credit cards cost you money. But it usually eliminates your AR problems, which could be worth the expense.

[jimmcg]

I guess I am typical of "old guard" but I always use cash on delivery and if it appears it will involve a sizable amount of work then an adequate retainer up front.....Works for me however I can see where a high volume enterprise might want to consider credit cards as an option.

[JoshinNC]

We do take cards,

and it has helped the "I left my checkbook at home" crowd. But, we still have problems with people who are in "dire straits". We try to make arrangements (i.e. postdated checks, payment plans, etc.), but it really comes down to growing your practice to the size where you can "fire" the deadbeats, and still make a decent living. We're not there yet, but I plan on getting rid of a couple next year.

Hope this helps.

[Armando Beaujolais]

it has helped the "I left my checkbook at home" crowd.

Amen.

The family firm where I worked had a big reduction in unpaid forms when they started taking credit cards. In their situation, they're a local business where community goodwill is real important, so they weren't in a position to take a hard line with people who left their checkbook at home.

The real problem, though, was momma working in a place where clients coming in could make eye contact. "Oh, hi, momma. Is it O.K. if I mail you a check?" Of course momma would say oh sure, no problem.

Poppa built a wall and put in a two-way mirror in front of momma. That increased collections to near 100%.

[Jim R]

credit cards.

If they are not a quarterly or monthly client but a service when needed, the billing is payment on delivery or retainer for large projects. To do this I feel I need all the payment options I can provide including credit and debit cards.

About 2 years ago payments in this country by credit and debit cards exceeded payments by cash or check. So the trends are against the "old guard" Are the fees worth it? Hard to say. They are about the same as the losses from bounced checks. I just look at it as another cost of doing business. And as banks are promoting check cards, down the road accepting plastic will be a neccesity.

[BMW CPA]

Just got out of a meeting with the credit card processing guys. We had thought is was illegal to pass the cost on to the consumer somehow. It is illegal to say that you are adding a 'surcharge' for the credit card - but not illegal to have a 'processing fee', 'handling charge', discount for cash, etc.

This could be a great solution to that dilemma. We are definitely a small town firm with strong community ties and clients who are used to doing things the old way. It will be a slow transition - but worth the effort I believe.

Great message board! Glad I found you all.

[veritas]

We started taking cards this year and it has been very helpful collecting. We don't advertise it but if a client starts with the "I forgot my checkbook" we let them know right away and almost always collect immediately.

[taxmandan]

This year was our first accepting c cards, it is well worth the fees. It does help with the "I forgot my checkbook" clients. We bought a machine on E-Bay with a 1 year warranty, ~$180 including shipping. DON'T rent a machine from the bank, it's too expensive. We negotiated no monthly charge, no statement charge, lowest discount fee around (Costco has the lowest I found and when I showed the sales rep, he agreed to match it). As for charging a handling fee for a cc, I just adjust my overall fees to cover such expenses just like the office rent, electricity, etc. No need to identify a seperate charge to a cc client.

We signed up for AMEX but found they tried to charge a "low use fee" in spite of the contract so I cancelled their service. Clients who have AMEX also have a Visa/MC card and I have had not problem with refusing the AMEX.