Credit card surcharging rules by state
Passing card fees to customers is legal in most of the country and a real option for some businesses. It is also one of the easiest things to get wrong, and the penalties land on you rather than your processor.
Surcharging credit cards is permitted in most states, capped at your actual cost of acceptance or 3%, whichever is lower. You may never surcharge a debit card - not even when it is run as credit and signed for. Connecticut, Massachusetts and Maine prohibit surcharging outright, California's price transparency law stops you adding it on top of an advertised price, Colorado caps it at 2% and Illinois at 1%.
With processing costs where they are, more owners are asking whether they can simply hand the fee to the customer. The answer is often yes. But surcharging sits at the intersection of state consumer protection law and private card network rules, and both have to be satisfied at once. Get it wrong and you are exposed to network fines, state penalties, and in the worst case losing your merchant account.
Which rule breaks first? Almost always the debit rule
Before anything else: debit cards and prepaid cards cannot be surcharged. Ever. In any state. This holds even when a customer runs their debit card as credit and signs for it, which feels counterintuitive and is exactly why it catches people.
The practical failure is nearly always technical rather than deliberate. A point of sale system gets configured to add 3% to every card transaction, nobody checks whether it distinguishes debit from credit, and the business is out of compliance on every debit sale from day one. If you take one thing from this page, make it this: before you switch surcharging on, have your provider demonstrate that the system correctly identifies and excludes debit.
Ask this exact question: "Show me a test transaction proving the system excludes debit and prepaid cards from the surcharge." If your provider cannot demonstrate it, you are not ready to switch it on.
Where is surcharging restricted?
Most states permit credit card surcharging subject to the network rules below. These are the states with specific statutory restrictions as of July 2026:
| State | Status | What it means in practice |
|---|---|---|
| Connecticut | Prohibited | Credit card surcharges are barred by statute. Cash discounting remains available. |
| Massachusetts | Prohibited | Credit card surcharges are barred by statute. Cash discounting remains available. |
| Maine | Prohibited | Credit card surcharges are barred by statute. Cash discounting remains available. |
| California | Effectively barred | Different mechanism. California's price transparency law (SB 478, effective July 2024) requires the advertised price to be the full price a customer pays, taxes aside. That prevents adding a surcharge at the register on top of a posted price. Building the cost into your posted prices, or offering a cash discount, remains permitted. |
| Colorado | Capped at 2% | Permitted, but the surcharge may not exceed 2% - lower than the 3% network cap. |
| Illinois | Capped at 1% | Permitted up to 1% or your actual processing cost, whichever is less. Separately, from July 2026 Illinois restricts interchange being charged on the tax and gratuity portion of a transaction where the acquirer is notified at authorization or settlement. |
| All other states | Generally permitted | Subject to the card network requirements below. Several states have proposed legislation in recent sessions, so confirm current status before you launch. |
General information as of July 2026, not legal advice. State law in this area changes frequently and some statutes remain subject to litigation. Confirm current requirements with your own counsel and your acquirer before surcharging.
Look up your state
Every state and Washington, D.C., searchable in full - not just the seven above with the most unusual rules. A handful of these - Texas and Oklahoma especially - turn on active or recent litigation rather than a settled statute, so treat those as a starting point for a conversation with counsel, not a final answer.
No state matches that search.
Northeast
Connecticut Prohibited
Credit card surcharges are prohibited outright under Conn. Gen. Stat. § 42-133ff. Cash discounting is still available if you want to pass along some of the cost.
Maine Prohibited
Maine law bars adding a surcharge for paying by credit card. As in Connecticut and Massachusetts, cash discounting remains an option.
Massachusetts Prohibited
Mass. Gen. Laws ch. 140D § 28A(a) prohibits surcharging, and unlike similar bans in several other states, this one has held up against legal challenge.
New Hampshire Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
New Jersey Capped at cost
Surcharges are capped at whatever you actually pay to accept the card - you cannot mark it up beyond your real cost, and it must be clearly disclosed.
New York Capped + disclosure
Surcharges cannot exceed your actual card-acceptance cost, and New York’s Gen. Bus. Law § 518 requires the total credit card price to be posted alongside the cash price rather than added as a surprise at checkout. Violations carry a civil penalty of up to $500.
Pennsylvania Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Rhode Island Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Vermont Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Midwest
Illinois Capped at 1%
Illinois caps surcharges at 1% of the transaction or your actual processing cost, whichever is lower - stricter than the 3% network cap that applies almost everywhere else. Starting July 2026, Illinois separately bars charging interchange on the tax and gratuity portion of a sale where the acquirer is notified at authorization or settlement.
Indiana Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Iowa Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Kansas Cleared by the courts
Kansas’s old surcharge ban was struck down by federal courts as unconstitutional. As of January 1, 2025, merchants can surcharge legally as long as they post notice.
Michigan Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Minnesota Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Missouri Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Nebraska Capped at cost
Nebraska law limits surcharges to the actual cost of accepting the card. That rule is most clearly established for state and local government payments; private merchants should apply the same cap to stay safe.
North Dakota Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Ohio Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
South Dakota Capped at cost
South Dakota limits any surcharge to your actual cost of accepting the card.
Wisconsin Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
South
Alabama Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Arkansas Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Delaware Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
District of Columbia Disclosure required
D.C.’s 2026 Enhancing Consumer Protection Procedures Amendment Act bars “drip pricing” - any mandatory fee has to be built into the advertised price rather than added at checkout, which functions similarly to California’s rule even though it isn’t a surcharge ban by name.
Florida On the books, not enforced
Florida’s surcharge ban was struck down by the 11th Circuit in Dana’s Railroad Supply v. Attorney General (2015) and hasn’t been enforced since, but the statute is technically still on the books. Surcharging is treated as legal in practice, capped at 3% or your actual cost.
Georgia Conditional
Georgia allows a credit card convenience fee, but only if you also accept a non-card form of payment - you can’t surcharge if cards are the only way to pay.
Kentucky Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Louisiana Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Maryland Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Mississippi Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
North Carolina Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Oklahoma Cleared by the courts
Oklahoma’s surcharge ban has been invalidated by federal courts, and the state passed SB 677 (2025-2026) moving toward formally recognizing that. Card network onboarding for Oklahoma surcharge programs has been expanding through 2026, but the transition is recent enough that it’s worth confirming current status with counsel before you launch.
South Carolina Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Tennessee Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Texas Legally unsettled
A federal court struck down Texas’s surcharge ban in Rowell v. Paxton (2018) as unconstitutional, but the state attorney general has argued the ruling doesn’t clear every merchant in every situation. Many Texas businesses use cash discounting instead of a literal surcharge to stay on the safe side - talk to counsel before surcharging outright.
Virginia Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
West Virginia Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
West
Alaska Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Arizona Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
California Disclosure required
California doesn’t ban surcharges by name, but SB 478 requires the advertised price to be the full price, which rules out adding a surcharge at the register on top of a posted price. Restaurants and bars have a carve-out under SB 1524 allowing a clearly disclosed service charge. Outside that carve-out, building the cost into your prices or offering a cash discount is the safer route.
Colorado Capped at 2%
Colorado permits surcharging but caps it at 2%, tighter than the 3% network cap most states allow.
Hawaii Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Idaho Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Montana Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Nevada Capped + disclosure
Nevada caps surcharges at your actual cost of acceptance and requires clear disclosure. The state attorney general has flagged surcharges above 1.5% as worth asking a merchant to justify.
New Mexico Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Oregon Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Utah Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Washington Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
Wyoming Generally permitted
No state-specific restriction. Surcharging is generally permitted here, subject to the standard Visa/Mastercard rules: cap it at 3% or your actual cost of acceptance, whichever is lower, give 30 days’ notice, post signage, and show it as its own line on the receipt.
What do Visa and Mastercard require?
Even where your state permits it, the networks impose their own conditions, and these apply nationwide:
- Cap of 3%. Both Visa and Mastercard cap credit card surcharges at 3%, reduced from 4% in April 2023 - and never more than your actual cost of accepting that card. If your cost of acceptance is 2.4%, your ceiling is 2.4%, not 3%.
- 30 days' written notice. You must notify your acquirer and the card networks before you begin. This is not optional and it is not retroactive.
- Signage. Clear disclosure at the entrance and at the point of sale, and on the checkout page for online sales.
- Receipt line item. The surcharge must appear as its own separate line, not folded into the total.
- Credit only. Debit and prepaid are excluded, as above.
- Consistency across brands. You cannot surcharge one network's cards more heavily than a competitor's.
You can read the current requirements directly from Visa and Mastercard.
Surcharging, cash discounting, dual pricing: what is the difference?
These get used interchangeably by sales reps. They are not the same thing, and the distinction determines what you are allowed to do.
| Model | How it works | Where it stands |
|---|---|---|
| Surcharging | Posted price is the cash price. A fee is added when the customer pays by credit card. | Restricted by state law and network rules. Notice, signage and caps all apply. |
| Cash discounting | Posted price is the card price. Customers paying cash receive a stated discount. | Permitted in all fifty states and not restricted by the networks in the same way. The safer route in restrictive states. |
| Dual pricing | Both prices are shown side by side on the shelf, menu or screen. | Generally permitted where both prices are displayed clearly and equally. The transparency it forces is what keeps it compliant. |
The economics can be identical. The legal treatment is not, and that gap is precisely why cash discounting is often the better answer for a business in Connecticut, Massachusetts, Maine or California.
Should you actually do it?
Compliance is only half the question. The other half is whether it is right for your business, and we would encourage genuine caution here.
- It is visible to every customer, every transaction. In a competitive local market that can cost you more than the fee saves. Restaurants and service businesses tend to feel this hardest.
- It does not fix an expensive contract. Surcharging moves your cost onto customers. It does not make the cost smaller, and a poor markup is still a poor markup. Fixing the rate first is nearly always the better sequence - see how to lower your processing fees.
- The admin is real. Notice, signage, receipt formatting, POS configuration, and staff who can explain it at the counter without irritating anyone.
- It works best in B2B and high-ticket settings, where the customer expects it and the amounts are large enough to matter.
Worth knowing before you commit: the pending Visa and Mastercard settlement is expected to expand merchant flexibility on surcharging when it takes effect. If you are weighing this up, that timing may be relevant - see what the settlement actually means for your business.
Not sure surcharging is the right move?
Send us your statement first. We'll show you what your actual cost of acceptance is - the number that caps any surcharge anyway - and whether lowering it outright would get you further. Free, no obligation.
Get My Free Rate ReviewThis page is general information for business owners, not legal advice, and Bizzy Advisors is not a law firm. Surcharging law varies by state, changes frequently, and individual statutes are periodically subject to challenge. Card network rules are set independently by Visa, Mastercard, Discover and American Express and can change without notice. Confirm current requirements with your own legal counsel and your acquiring bank before implementing a surcharge, cash discount or dual pricing program.