Credit card surcharge laws by state (September 2026)

A credit card surcharge is an extra fee you add to a sale when the customer pays with a credit card. Visa's own definition calls it "an additional fee or charge that a merchant adds to a consumer's bill for using a particular form of payment," and that framing matters because the fee belongs to you, the merchant, and every rule about it is written with that in mind.

If you own a paint, hardware, farm and feed, lawn and garden, or lumber store, you already know why this question is on your desk. When a contractor puts a $4,000 lumber package or a pallet of five-gallon buckets on a rewards card, the processing fee on that one ticket can run past a hundred dollars, and it comes straight out of your margin on a sale you already priced sharp to win. Owners are asking whether they can pass that cost along, and the answer in most of the country is yes, with conditions. The rules below are current as of September 2026, and where they change by state, we've linked the statute itself so you can read the source instead of taking a processor's blog word for it.

Surcharge, cash discount, or dual pricing: what's the difference

Three models get lumped together in this conversation, and the card networks and state laws treat each one differently, so it's worth getting them straight before you set anything up.

A surcharge starts from the lower price and adds a fee for credit. This is the model with the most rules around it: caps, disclosures, receipt lines, and a handful of states that flatly prohibit it. It's also the model where the fee has to show as its own line item, which your POS has to handle cleanly.

A cash discount starts from the higher price and takes something off for cash. Visa allows this as a "discount offer," but with a catch that trips people up: your displayed prices have to be either the card price alone or the card and cash prices side by side per item. If you post the lower price and then add a fee for card payments at the register, Visa says that "may be treated as a surcharge" and all the surcharge rules come crashing down on you. Connecticut's 2022 amendment says the same thing in statute: for a cash discount, the listed price must be the credit card price, and the customer has to see the notice before the transaction.

Dual pricing is the side-by-side version of that idea, where both prices live on the tag or the sign for every item. New York's Department of State lists "Clearly display BOTH the Credit Card and the Cash Price" as a legal approach, and for a lot of stores it's the least confusing way to do any of this, because the customer sees the full picture before anyone touches the register.

The card-network rules (Visa and Mastercard)

No matter what your state allows, Visa and Mastercard have their own rulebooks, and Visa says it enforces its surcharge rules with a yearly mystery-shopping program run by outside auditors. The acquirer (the bank or processor that handles your card deposits) of a merchant caught surcharging improperly can be assessed an immediate $1,000 fine, and that cost tends to roll downhill to the store, so this is the part to get right.

Notice. Visa wants you to notify your acquirer at least 30 days before you start surcharging. Mastercard historically required 30 days' written notice to Mastercard and your acquirer, though its merchant surcharge page now says it's revising its rules and isn't currently requiring merchants to register their intent while those revisions are pending. The practical move: tell your processor 30 days ahead and ask them what Mastercard requires at that moment.

The cap. The surcharge can never exceed your merchant discount rate (what you pay to take that card, as a percentage), and Visa adds a hard ceiling of 3%, in effect since April 15, 2023. Mastercard's absolute cap is 4%, but that only matters if your cost of acceptance tops 4%; as Mastercard's own FAQ puts it, if your merchant discount rate is 2.50%, your cap is 2.50%, not 4%. In plain terms: you can recover your cost, you can't profit on the fee.

Credit only. Debit cards and prepaid cards cannot be surcharged, full stop, and that includes a debit card the customer runs "as credit" at the terminal. Your staff needs to know this cold, because the network rules don't care that the card looked like a credit card.

Disclosure and receipt. You disclose at the point of entry, at the point of sale, and on every receipt as a separate line item. You can surcharge at the brand level (all Visa credit) or the product level (specific card types), but not both. If you take Amex or Discover, the networks may require you to surcharge those on equal terms with competing brands that cost the same or more. And if you run stores in more than one state, each store follows its own state's law.

The pending settlement. On June 9, 2026, U.S. District Judge Brian Cogan granted preliminary approval to a revised Visa and Mastercard settlement with merchants that would give merchants new rights to surcharge and offer discounts, and to decline some premium and commercial credit cards. Preliminary is not final, and final approval comes only after a notice and objection period. Until the court signs off and the networks publish new rules, the rules above are the ones you're living under.

Credit card surcharge laws by state (as of September 2026)

If your state isn't in the table, we didn't find a surcharge statute on the books there as of September 2026, which means the card-network rules are your ceiling. Don't get comfortable, though, because this area of law moves. Oklahoma flipped from banned to allowed on November 1, 2025, New Jersey set its rules in 2023, and plenty of third-party lists floating around the internet still show Maine and Oklahoma wrong. Even Visa's own Q&A admits its state list may contain errors. Before you flip surcharging on, spend ten minutes on your state attorney general's website, and if you're in California, get advice specific to your situation.

Canada: surcharging since October 2022

Canadian stores got surcharge rights through a legal settlement that took effect on October 6, 2022. The shape of it will look familiar: Visa credit cards can be surcharged, debit and prepaid cannot, and the cap is your merchant discount rate with an absolute maximum of 2.4%, whichever is lower. You disclose at the point of entry and the point of transaction, including the exact amount or percentage and the fact that the fee comes from you and not Visa and applies only to credit, and you show it on the receipt. The Canadian Federation of Independent Business notes you should give your acquirer 30 days' notice before you start, and that Quebec's consumer protection law doesn't allow surcharging consumer transactions at all, though B2B surcharging may be permitted there. Provincial or federal law supersedes the network rules, and one more wrinkle: convenience fees are not permitted in Canada.

Surcharge sign wording that covers the basics

New Jersey's Division of Consumer Affairs is blunt about this: "It is not enough for a seller to post a sign stating: 'We impose a credit card surcharge that does not exceed our processing costs.'" You have to state the amount. Handwritten signs are fine if they're clear and conspicuous, and a flat percentage on all cards works as long as it doesn't exceed your actual cost on a given transaction. Here's New Jersey's own compliant example, adapted for the door and the register:

We impose a credit card surcharge of 2% for using Credit Card X and a surcharge of 2.25% for using Credit Card Y.

Colorado goes further and writes the sign language into the statute. If you're in Colorado and use the 2% method, this is the wording, plus a statement that the surcharge doesn't apply to cash, check, debit card, or gift card payments:

To cover the cost of processing a credit or charge card transaction, and pursuant to section 5-2-212, Colorado Revised Statutes, a seller or lessor may impose a processing surcharge in an amount not to exceed 2% of the total payment made for goods or services purchased or leased by use of a credit or charge card.

Wherever you are, a sign that covers the basics should hit every point on this list:

• The exact surcharge amount or percentage, stated before the sale, posted at the point of entry and again at the point of sale.
• Clear language that the fee applies to credit cards only, and not to cash, check, debit, or prepaid.
• Receipts that show the surcharge as its own separate line item, every time.
• Your state's extras on top: New York requires you to post the highest total price, surcharge included, before the purchase, so a wall sign plus a register fee line won't cut it there.

New York's guide is also a handy list of what not to do anywhere: no "+4% fee if paying with credit card" tags, no "processing fee" or "non-cash adjustment" lines that appear on the receipt without the total price posted first, and no advertising that all prices include a cash discount that card customers never get.

How your POS should handle surcharging

The networks, your state, and your processor are three rulebooks stacked on top of each other, and the strictest one wins. Your POS is where all three get enforced at 7 a.m. on a Tuesday, so before you commit to a system, ask these questions:

• Can I set the surcharge as a percentage, and cap it where my rules cap it (my actual cost, 3% for Visa, 2% in Colorado and Oklahoma)?
• Does the fee apply only to card sales, leaving cash, check, and charge-account tickets alone?
• Does it print as its own line item on the receipt, with the percentage spelled out?
• Can a cashier waive the fee on a single sale, and can I exempt a specific customer, like a contractor I've agreed not to surcharge?
• Can I see total surcharges collected in my reporting, so I know what the program is recovering?
• What happens when a customer hands over a debit card, and is that handled by the system or by training?

How Rundoo handles it

Rundoo's point of sale treats the card surcharge as a single company-wide percentage that you set in Admin, anywhere from 0% (off) up to 4%, with no flat per-transaction fee option. Because the dial goes to 4%, the discipline is on you: set it at or below the lowest cap that applies to you, which means your actual cost of acceptance, 3% for Visa, and your state's cap if you have one. The fee applies only to sales paid with the Card tender, and it shows as its own "Card fee (N%)" line on the sale and on the customer receipt. Cash, check, and charge-account sales never see it, which matters if a good share of your contractor volume already runs on charge accounts instead of plastic.

People are the other half of enforcement, and Rundoo gives you two levers. A cashier can uncheck the card fee on a single sale to waive it, and a customer record can be set exempt from the surcharge by default, so the contractor you promised no fees gets handled automatically while staff can still re-check it per sale. Here's the training point to put in your opening meeting: Rundoo does not automatically detect debit cards, so when a customer pays with debit or prepaid, your cashier unchecks the card fee. Say it out loud, put it on a sticky note at the register, and check in on it during the first month.

Rundoo doesn't have a built-in cash-discount or dual-pricing mode, so if you want to reward cash, your team applies a discount at checkout. On the reporting side, the summary dashboard has a Card surcharge tile showing the total surcharges passed to customers for the period, so you can see what the program is recovering against the cost of taking cards. The rule follows the customer out of the store, too: in the Customer app, a customer paying an invoice by card sees the same card fee they would at the counter, while paying by bank (ACH) carries no surcharge at all. For stores with big contractor balances, that ACH path is worth a line on your statements, since a contractor who pays a $4,000 invoice by bank transfer skips the surcharge and keeps that ticket off the card network entirely.

We ask every new store to make the surcharge decision during onboarding, keeping in mind that surcharging is regulated differently by state, and it's on our implementation checklist so it doesn't become an afterthought. A garden center owner in Washington told us their old system couldn't automate surcharging at all, and they were eating card fees on every sale while they looked for something that could. If you do nothing else, set the percentage at or below your lowest applicable cap and train the debit rule, because those two habits keep the fee from nickel-and-diming you right back in fines.

That's the whole playbook: never charge more than your actual cost of acceptance, never more than 3% on Visa, never on debit or prepaid, disclose before the sale and on the receipt, and check your state row before you flip the switch. Do those five things and the surcharge does what it's supposed to do, which is keep card costs from quietly sanding down the margin on your biggest tickets.