Nevada is one of the most business-friendly states in the country. There’s no corporate income tax, and it has some of the strongest privacy and asset protection laws in the country for businesses.
Do these business-friendly policies translate to Nevada’s credit card surcharging laws?
Read on to find out.
Disclaimer: This information is for reference only. It is not legal advice, and you should consult with an attorney before implementing a surcharge. Rules are constantly changing, and you should verify the accuracy of surcharge laws directly with your state.
Is Credit Card Surcharging Legal in Nevada?
Yes, merchants in Nevada can legally add a surcharge fee if customers pay for goods and services using a credit card, as long as:
- The fee does not exceed the merchant’s cost of acceptance.
- Notice is provided to the customer before imposing the fee.
- Signage is posted at the point of entry and the point of sale.
- The surcharge fee is itemized on the receipt.
According to Nevada Attorney General Aaron Ford, consumers have the right to ask businesses for documentation of their surcharge policies if they’re forced to pay a surcharge fee.
These laws are designed to protect consumers from deceptive tactics and prevent businesses from burying hidden fees in transactions. They’re very similar to the surcharge laws in other states, where surcharging is legal but regulated.
What About Debit Cards?
Debit card surcharging is illegal in all 50 states—including Nevada.
This federal law is part of the Durbin Amendment of the Dodd-Frank Consumer Protection Act.
What is the Maximum Allowable Surcharge on Credit Card Transactions in Nevada?
Nevada restricts surcharge fees from exceeding the merchant’s cost of acceptance, and federal law prohibits surcharges higher than 4% of the transaction.
So if it costs a business 3% to accept a credit card, they’d be capped at a 3% surcharge fee because Nevada law doesn’t allow merchants to profit on surcharge fees.
But if it costs a business 4.5% to accept credit cards, they’d still be bound by the 4% limit imposed by the federal government.
That said, it shouldn’t cost your business more than 4% to accept credit card payments. If that’s happening, you need to read your merchant statement carefully to look for hidden fees and inflated rates. There’s a good chance your processor is overcharging you, and you can negotiate better terms.
Penalties For Non-Compliance
Merchants found in violation of Nevada’s credit card surcharge laws can face civil penalties of up to $500 per violation.
How to Report Illegal Surcharging in Nevada
If you’re a customer in Nevada who believes that a business is illegally surcharging credit card transactions, you can file a complaint online directly with Nevada’s attorney general’s office.
Common violations include:
- Failing to properly disclose surcharge fees.
- Surcharge fees that exceed the merchant’s cost of acceptance.
- Surcharge fees that exceed 4% of the transaction.
- Surcharging debit card transactions.
For consumers in Nevada, our team at MCC would love to hear from you. Drop a comment on this post if you’ve seen surcharges at Nevada businesses, and let us know how you feel about them.
While we don’t offer any consumer-specific services, we’d like to pass this information to our clients to show them how the general public feels about being hit with additional fees.
Should Nevada Businesses Add a Surcharge Fee to Credit Card Transactions?
While surcharging is legal in Nevada, it doesn’t mean that you should automatically pass the burden to your customers.
First, you need to consider all of the state-specific and federal laws to ensure your surcharge program is actually legal. Talk to a local attorney to verify all of this. Then, you also need to ensure your policy is compliant with all of the different card network rules on surcharging. Visa, Mastercard, Discover, and Amex all have their own unique surcharge rules that must be followed.
If you’re still on the fence, we have some additional resources to help you—including the reasons why you should NOT surcharge credit cards and a list of scenarios when credit card surcharging makes sense for businesses.