USA Credit Card Fees

[DorothyThorpeLLC]

Hello!

We have one and ONLY ONE customer who would like to pay with a credit card but our company has never accepted credit cards before. I proposed to our controller that if we got set up for credit cards we could pass on any set-up or transaction fees directly to this one customer. They are 100% okay with paying for those fees. The controller (who is suuuuuuper old school) says that that is illegal from an accounting standpoint to pass those fees on. If the customer is aware of everything is that illegal?

Note: We are a wholesale importer NOT a retailer.

Thank you so much =)

 

[bklynboy]

You want to check with your legal area. This is not an accounting issue but one of law. Most states permit a surcharge to be passed to a consumer on credit card transactions - though some states have laws against it. Also, each credit card company has a policy on what they will allow as they generally frown upon this because it may prevent use of the card and impact their revenue.

 

[Samir]

There may be an issue if it is a 'credit card fee'. But I believe you can call it a 'transaction charge' or 'order processing fee' and be okay.

The fastest/easiest way around this problem is to simply use something like a paypal business account for this one transaction. You can accept credit cards and the fees won't be as much as setting up a traditional merchant account, so you don't have to charge the customer as much.

However, there's a more important aspect here in terms of wholesale/retail. If this is a retail customer, you would be responsible to collect and remit any sales taxes (which is a pain if you're only wholesale up to this point!). Something to consider.