How Much Can I Charge a Customer for Using a Credit Card?

The safe and easy answer is “nothing.”

Some states prohibit surcharges for credit card use, period. Some states permit it but with some complicated qualifiers, like no surcharge on debit cards, surcharge limited to what you actually paid and other such language buried in your merchant service agreement. The regulations are too many, making compliance too expensive and too risky.

Also, there is the issue of market reputation. How do you feel about doing business with someone who charges you a surcharge for using your credit card? I used to avoid suppliers who did this. I had lots of other choices of suppliers, and customers have lots of choices too.

An alternative solution might be to increase your prices slightly and offer a cash discount. Offering a discount has a more market-friendly feel than the charging of an extra fee. (And check with your CPA to make sure a “discount for cash” is acceptable in your area.)

And if you use Intuit Merchant Services, you can add a link to your invoices, allowing clients to pay electronically through an ACH payment for only 50 cents a transaction.

Please email accounting questions you would like considered for the column to HGatter@AccountingSupportLLC.com with the subject line of "Ask the Accountant."