Merchant Services

[Terry D EA]

Has anyone signed up for the merchant services? Seems like an okay deal. I have only had one client over the last ten years ask if I take credit cards and was wondering if anyone has seen an increase in business from being able to take them. Thnanks for your input.

Terry D.

[Slappy Tax]

I accept credit-cards and have for 5 years or so. It's definitely a 2-edged sword, however, having lots of pro's and at least one big con. First, I've found that most clients these days just assume every business can take credit-cards. More and more don't ask--they just pull out the credit-card or debit card. Like it or not, most people just don't write checks anymore--their debit-cards have replaced their checkbooks. This saves me from having to process checks, go to the bank to make deposits, and deal with the occasional bad check. BUT, it also means that I have to cough up a percentage of my fee (in my case, it's 3.75%) for those conveniences. It allows me to accept payments by phone from clients I haven't seen in years whose returns we do by mail, fax, and email. Overall, I'd say accepting credit and debit cards has become a necessary evil in today's business world. It helps me, but it does come with that price tag. I've heard of others whose merchant fees are less than 3.75%, but those types of accounts seem always to come with monthly fees and per transaction fees. I've run some numbers cursorily and concluded that, in my case at least, it's six of one, half dozen of the other, whether I should opt for a lower percentage rate with monthly fees and per transaction fees, or just keep paying the 3.75% of the charge.

[taxtrio]

I agree, a necessary evil. But 3.75%!! Wow!, but I suppose if it's only an occasional client...

Have you checked into the merchant account available to NATP Members??

I'm thinking of switching to the company that gives a discount through NATP.

The good thing for someone small like myself is that the monthly fee is only 5.00 per month with no contract and no minimum; and you can use them for just the tax season (4 months) each year and save that way... The only thing is I have to get a credit card machine... They offer one for 343.00 (or close to that)--- they will let us pay in 4 installments for the tax season.

But I've bought one second hand, a couple of years old but supposed to work.

I'll let you know how it works for me, and their rates are less than 3.75%..

[Slappy Tax]

Thanks for the tips. I know I need to do something about this, but I never seem to get around to it. As I say, I have run some crude calculations and concluded that I'd be about in the same spot if I paid monthly fees and per transaction charges. I obviously need to do more research and rethink this. I don't have a card scanner--I just enter everything though the authorize.net website. I think entering transactions via computer also increases the percentage I pay since I believe that transactions via a card scanner are charged a lower rate. I'm going to move this project up on my priority list, but I've said that before. Thanks again for the recommendations.

[GeorgeM]

I agree, a necessary evil. But 3.75%!! Wow!, but I suppose if it's only an occasional client...

Have you checked into the merchant account available to NATP Members??

I'm thinking of switching to the company that gives a discount through NATP.

The good thing for someone small like myself is that the monthly fee is only 5.00 per month with no contract and no minimum; and you can use them for just the tax season (4 months) each year and save that way... The only thing is I have to get a credit card machine... They offer one for 343.00 (or close to that)--- they will let us pay in 4 installments for the tax season.

But I've bought one second hand, a couple of years old but supposed to work.

I'll let you know how it works for me, and their rates are less than 3.75%..

Regarding the machine to process credit cards, I worked for a cowpony who used Peachtree and we were able to process credit cards through Peachtree. Don't know if any other accounting package allows this, but its worth looking into if you have to buy a machine.

[Tax Prep by Deb]

Quickbooks also has a credit card processing package, however there is a minimum monthly usage fee, and for the one client of mine that used them, it was too costly.

Don't forget to check with Costco and possible even Sam's Club. Costco has what seems to be a decent transaction rate for their Executive Member's however I have not priced them.

I use Pro-pay for what little credit cards I do process, and the only reason I have it is because I get it thru a small side business that I do. They negotiated a very good rate for me and although I do have to pay a small commission it's still way cheaper than having to track down clients for payment! I know personally speaking I had writing a check, or carrying cash. I use my card for everything, then pay it off at the end of the month. I do this mainly because the three cards I carrying pay me back for using it. Perhaps our clients have similar programs and is why it is becoming increasingly popular!

Deb!

[1040PRO]

I still do not take credit card and I am not for the currect year. I have 50% cash 40% check and 10% RAL I know that if I start taking CC that most people will want to pay by CC and even if my fees were only 2-2.5% it is not worth the few clients i loose because I dont accept CC. I would lose over $5000 a tax season in fees and it just is not worth.

I make sure that it is highlighted in my year end letter, posted in my lobby and on my desk that we do not take credit or debit cards.