Credit Card Surcharge Laws by State: What Is Legal, What Is Capped, and Where It Is Banned

Yes, it is legal to charge customers a credit card fee in most of the United States, as long as you follow the card network rules and the laws of each state you sell into. A handful of states add requirements of their own on top of the network rules, and Massachusetts and Connecticut ban credit card surcharges outright.

This guide covers the state laws and the federal rule as of October 2026, how the junk fee laws treat surcharges, and the questions merchants ask most. The card network material is from the Visa Core Rules and Visa Product and Service Rules dated 18 April 2026. None of this is legal advice; check the law in each state where you sell before changing your checkout.

The credit card surcharge rules that apply in every state

Before any state law enters the picture, Visa's rules set the floor for every US merchant:

• Surcharges are allowed on credit cards only, never on debit cards, even where a state's price-display law would permit it.
• You must give your acquirer written notice at least 30 calendar days before announcing or first charging a credit card surcharge.
• In the US, the surcharge may not exceed 3%, and a brand-level surcharge may not exceed your Visa Surcharge Cap.
• For an ecommerce sale, the surcharge must be disclosed on the first page that references the card brands you accept and again on the checkout page.
• The surcharge must be included in the transaction amount.

These rules already answer the questions merchants ask most. Businesses charge 3% to use a credit card because 3% is Visa's US maximum, and the surcharge is meant to pass through what the card costs the merchant to accept. A 2% surcharge sits inside the cap and is fine wherever surcharging is legal at all. A 4% credit card fee is not allowed anywhere in the US, because it exceeds the 3% network maximum. And a surcharge on a debit card, at any percentage, breaks the network rules regardless of state law. To see where that 3% actually goes, our guide to how credit card processing fees break down walks through it.

Credit card surcharge laws by state

Most states let the network rules govern. The states below have written their own requirements, and they differ enough that a checkout built for one can break the law in another. If a state you sell into is not covered here, check its law before you rely on the network rules alone.

California

California's SB 478, effective July 1, 2024, added section 1770(a)(29) to the Civil Code and makes advertising a price that leaves out mandatory fees a deceptive practice. The Attorney General's FAQ says a credit card processing fee generally does not have to be included in the advertised price, because the customer can avoid it by paying a different way. The exception matters: if a business accepts only credit cards, the fee is mandatory and has to be built into the advertised price. The law governs how the price is presented, not what you may charge.

Minnesota

Minnesota's amendments to the Deceptive Trade Practices Act, Minnesota Statutes section 325D.44, took effect January 1, 2025, and carry civil penalties of up to $25,000 per violation. The Attorney General's FAQ lists credit card surcharges among the fees that may be left out of the advertised price so long as they are reasonably avoidable, with cash as the example. The same FAQ reminds businesses that other consumer protection laws still govern how the surcharge is communicated.

Colorado

Colorado merchants have two laws to follow. Colorado Revised Statutes section 5-2-212 lets a seller surcharge credit and charge cards either up to 2% of the transaction or up to the merchant discount fee it actually pays. The seller must post the statute's prescribed notice, which for an online sale must appear before the customer completes the purchase. The surcharge must show as a separate line item, only one surcharge is allowed per transaction, and none may be charged on cash, checks, debit cards, payments processed as debit, or gift card redemptions. The 2% option is lower than Visa's 3% US maximum, so a Colorado merchant using it cannot surcharge up to the network ceiling.

On top of that, HB25-1090, effective January 1, 2026, added section 6-1-737 to the Colorado Consumer Protection Act and requires the total price to be shown as a single number, more prominently than any other pricing information. The statute does not mention card surcharges, and as of October 2026 we found no Colorado Attorney General guidance applying it to them, so treat its "not reasonably avoidable" language as a reading of the text rather than a settled answer.

Massachusetts

Massachusetts bans credit card surcharges. General Laws chapter 140D, section 28A, says no seller may impose a surcharge on a cardholder who elects to use a credit card instead of cash, check or similar means. The Attorney General's junk fee regulations at 940 CMR 38.00, enforceable since September 2, 2025, sit on top of that ban rather than creating room for a disclosed surcharge. What the statute does allow is a discount for paying by cash, check or other non-card means, offered to every buyer and disclosed clearly. If you sell subscriptions to Massachusetts customers, 940 CMR 38.00 also adds trial and recurring-charge disclosure rules that apply whether or not you surcharge. Connecticut bans credit card surcharges as well.

New York

New York allows surcharging but requires the full card price up front. Since February 11, 2024, General Business Law section 518 has required a business that surcharges credit card users to post the highest total price, including the surcharge, before the purchase, and it limits the surcharge to what the card company charges the business. The Department of State's guidance lists as illegal adding a convenience fee, service fee, processing fee or similar line item to credit card receipts without clearly posting the total price first. Showing both a card price and a cash price, or one price for both, complies. Violations carry a civil penalty of up to $500 each. A checkout that passes in California can still break New York law if you sell to New York customers.

The federal junk fee rule

The FTC's Rule on Unfair or Deceptive Fees, 16 CFR Part 464, took effect May 12, 2025, and covers only live-event tickets and short-term lodging. The FTC has said that businesses in other industries are still prohibited from deceiving consumers about fees under existing law.

How junk fee laws treat surcharges

The junk fee laws in California, Minnesota, Colorado and Massachusetts share one idea: the price you show must be the full price the customer pays. The test that decides whether a surcharge belongs in that price is avoidability. A credit card surcharge is, by its nature, a fee the customer pays only if they choose a credit card, and California's and Minnesota's regulators have both said in writing that an avoidable surcharge may sit outside the advertised price.

The trap is for card-only businesses. A store that sells online or by phone and takes nothing but cards has no cash option for the customer to choose. If every customer pays the surcharge, it is a mandatory fee and belongs in the advertised price; showing a lower price that grows by 3% at checkout is exactly what these laws target. Whether accepting debit, ACH or eCheck without a surcharge makes the fee avoidable has not been tested in published guidance; the regulators' examples use cash. The safer position is an alternative that is real and visible: offered on the same checkout page, not hidden behind a support email, with the surcharge-free total shown before the customer commits. Minnesota's FAQ does say a surcharge on debit cards would not be a mandatory fee if paying by debit is optional, but that answers only the state's price-display question; the network rules still permit surcharges on credit cards only.

The bigger risk for many online merchants is not the surcharge at all. A flat "processing fee", "service fee" or "platform fee" added to every order is the textbook mandatory fee, and in California, Minnesota, Colorado and Massachusetts it has to be in the advertised price. Renaming a fee does not move it into a different category. A fee only card payers pay is a surcharge and must meet the surcharge rules; a fee everyone pays is part of the price. Visa's rules for convenience fees draw the same line, and explain why an online-only business cannot use the convenience fee model at all.

How to disclose a surcharge to customers

Even where an avoidable surcharge may be left out of the advertised price, it must be disclosed. For an ecommerce sale, Visa requires disclosure on the first page that references the card brands you accept and again on the checkout page. The checkout disclosure must state the exact amount or percentage, that you are the one charging it and that it applies only to credit transactions, and that it is no greater than your discount rate for Visa credit cards. New York goes further and requires the full card-inclusive total to be posted before the purchase, and Colorado prescribes the exact notice wording its merchants must display.

A checklist before you add or keep a surcharge

1. List every fee your checkout adds. Anything every customer pays belongs in the advertised price in California, Minnesota, Colorado and Massachusetts.
2. For a credit card surcharge, confirm that customers have a genuine way to pay without it, shown on the same checkout. If you accept only credit cards, build the cost into your prices instead.
3. Check the states you sell into, not just your home state. Massachusetts bans card surcharges, New York requires the card total to be posted, and Colorado caps surcharges at 2% or the merchant discount fee and prescribes the notice wording.
4. Meet the card network rules: credit only, 30 days' notice to your acquirer, the 3% US maximum and your Visa Surcharge Cap, and disclosure on the first page that names the card brands and on the checkout page.
5. Never surcharge debit cards, even where a state's price-display law would allow it.
6. If you sell subscriptions to Massachusetts customers, review the trial and recurring-charge disclosures in 940 CMR 38.00 as well. They apply whether or not you surcharge.
7. Tell your processor before you launch. A surcharge setup that breaks network rules is something your acquirer will ask you to change.

Surcharging can make sense for a high-risk merchant whose card costs run above average, but only when it is set up as a genuine choice for the customer. A fee the customer did not expect is also a reason to dispute the charge, and disputes cost a high-risk account far more than the surcharge recovers. We work with card-not-present merchants that mainstream processors decline. If you are weighing a surcharge, contact us and we will tell you what your acquirer will require and what the setup needs to look like before you switch it on.