Can we NOT claim the fees for using credit cards?

[Crazy8]

If I have a client pay the 3% fee for using a credit card as weekly payment instead of paying by cash or check do I need to "show" that anywhere?? Basically, I am not getting the money, but they are paying it.

For example, clients charges for the weeks care are $175. But I process credit card at $180.25 to cover the service fee Square charges. I end up with $175 in my checking account. I use an excel spreadsheet for year end statements - do I have to put that they paid $180.25 or just $175.00???

[TomCopeland]

With the IRS it's always best to show income and show expenses, even when they wipe each other out. The client charged the parent $180.25 and paid $5.25 as a credit card fee. Show $180.25 as income from the parent and $5.25 as a credit card expense.

[Crazy8]

Originally Posted by TomCopeland

With the IRS it's always best to show income and show expenses, even when they wipe each other out. The client charged the parent $180.25 and paid $5.25 as a credit card fee. Show $180.25 as income from the parent and $5.25 as a credit card expense.

I was afraid that was the answer, LOL!!

[Angelsj]

Most credit cards forbid you from assessing a fee for using the card..ie charging the customer the merchant fees.

Network Rules currently prohibit you from (a) assessing a surcharge for the use of a Card in connection with any transaction, or (b) dispensing cash on any Card transaction.

This is from the merchant agreement on the Square card site. Just FYI.

[MarinaVanessa]

That's correct unfortunately. I play it safe and just eat the cost myself and claim it as a business expense. The same goes when they pay through Minute Menu's Chidcarepay.com. I just eat the $1 transaction fee and deduct it at the end of the year.

Or

You can slightly increase everyone weekly rate to cover this cost. That way if they ever decide to pay this way it's already covered in the rate even if every client does it.

[Crazy8]

Originally Posted by Angelsj

Most credit cards forbid you from assessing a fee for using the card..ie charging the customer the merchant fees.



This is from the merchant agreement on the Square card site. Just FYI.

ok, what if you are not calling it a "fee".... gas stations charge more for credit than cash all the time. And can you tell me where in that link it says that - I can't find it exactly!

[Angelsj]

It is under section 12. There are no rules that say you cannot give a discount for cash if you like. Same effect. Different wording.