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Can a law firm accept credit cards for legal fees?

In 1969, when the American Bar Association’s Committee on Ethics and Professional Responsibility first looked at whether a law firm could accept payment via credit cards, they could not have been more disdainful. The payment of legal fees using credit cards deemed unacceptable.

Why are lawyers taking credit cards instead of checks?

This is in spite of checks being eclipsed by payments being made with credit and debit cards by hundreds of billions of dollars across other industries. Still, many lawyers are accepting credit card payments—and are getting faster and collecting more because of it.

How do credit card processing services work for law firms?

Instead, with a credit card processing company that specializes in servicing law firms, you can designate where the funds go (operating for payment of invoice and escrow for retainer deposits), while all of the fees at the end of the month get deducted from the operating account.

Are there any credit cards that offer law firms as a bonus?

There aren’t any cards that have law firms as a bonus category, but you can use a card that rewards you for everyday spending or use the big expense to unlock a huge welcome bonus. Use one of the best credit cards to pay lawyers and legal fees to earn rewards for unavoidable expenses.

Can you put legal fees on a credit card?

It follows that the attorney may not ethically accept any payment or deposit from a client by credit card, whether for earned fees or fees not yet earned, if the payment or deposit includes advances for costs and expenses.

How do I tell customers about credit card fees?

Post signage that explains your policy at the checkout counter, and display any credit card fees as a line item on your customer's receipt. Not only is this a legal requirement in many states, but it will build trust between you and your customers and reduce confusion.

What types of fees are attached to a credit card?

8 common credit card feesAnnual fee.Interest charges.Late payment fee.Foreign transaction fee.Balance transfer fee.Cash advance fee.Over-the-limit fee.Returned payment fee.

What is the name for the credit card fee that is charged to you when you take money out of your card?

cash advance feeFirst, there's the cash advance fee. This is a fee the credit card company charges simply for the convenience of withdrawing cash against your cash advance limit. It may be either a flat fee, such as $5 to $10, or a percentage of the advance of amount, whichever is greater.

Is it illegal to charge a credit card fee to customers?

Credit card surcharges are optional fees added by a merchant when customers use a credit card to pay at checkout. Surcharges are legal unless restricted by state law. Businesses that choose to add surcharges are required to follow protocols to ensure full transparency.

How do I report a business to charge a credit card fee?

If you're in a state where it's illegal to add surcharges to a customer's bill and you find that a business is breaking the law, you can contact your state's Attorney General's office to file a complaint.

What are transaction fees?

A transaction fee is a charge that a business has to pay every time it processes a customer's payment. The cost of the transaction fee will vary depending on the service used.

What are credit card terms?

A credit card's terms and conditions officially document the rules and guidelines of the agreement between a credit card issuer and a cardholder. Common terms and conditions include the fees, interest rate, and annual percentage rate carried by the credit card.

What does represented payment mean?

Check representment is a service offered by banks to resubmit a bounced check to the check writer's account until funds are available. Typically banks present a check for payment twice to the Fed's clearing system. After this, the check has to be presented manually at a branch for processing.

Can you charge an admin fee for paying by card?

It's now illegal to charge an additional fee for paying by credit or debit card, but some companies have already found a way to keep charging customers.

How much is the Chase Freedom Unlimited bonus?

Although there’s no traditional welcome bonus, with the Chase Freedom Unlimited, earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening. There’s no annual fee, so you can keep the card for the long term and improve the average age of your account.

Why are Amex points valuable?

Amex Membership Rewards points are valuable because you can move them to Amex transfer partners like Delta, Singapore Airlines and British Airways. Plus, this is one of the only Amex Membership Rewards earning cards that has no annual fee ( see rates & fees ).

How much cash back does a Citi card give?

The Citi Double Cash card earns unlimited 2% cash back — 1% cash back on all purchases and an additional 1% on payments on those purchases. If you prefer the flexibility of cold, hard cash, this could be a good option.

Why are credit card payments so difficult for attorneys?

The primary reasons credit card payments are challenging for attorneys is because of the ethical and fiduciary duties imposed by the Rules of Professional Conduct and the inflexibility of some credit card processors who insist on the right to invade the depository account in the event the cardholder disputes a charge.

What should be included in a fee agreement?

At a minimum, you should include a paragraph in your fee agreement explaining the potential use of a rewards credit card for such expenses and obtaining the client’s informed consent for you or your law firm to keep the rewards that may accrue.

Can a law firm use a credit card?

A law firm could also ethically use a credit card processing company that makes debits only from the operating account and makes deposits into either the law firm’s trust account or operating account as designated by the attorney at the time the card is processed.

Can a credit card processing company take deposits out of one account?

Therefore, if a credit card processing company allows deposits and debits out of only one account, it would not be ethically permissible to utilize that credit card processing company for any advance fee or expense payments.

Can a credit card company debit a law firm's account?

In the event of a credit card chargeback or any other reason for the credit card company to debit one of the law firm’s accounts, those amounts absolutely must not come from a law firm trust account. Therefore, if a credit card processing company allows deposits and debits out of only one account, it would not be ethically permissible ...

Is it ethical to include a clause in a fee agreement?

It is ethically permissible to include a clause in the fee agreement stating that the firm will bill the client for work performed, wait a specified period of time, and then charge the amount to the credit card on file if the client has not made payment through other means.

Do lawyers have to explain credit card terms?

In addition to the trust accounting and confidentiality issues present when accepting credit card payments, lawyers must also be careful to explain the credit card payment terms to the client at the outset of the representation with the same care the lawyer would take in explaining any other legal fee arrangements.

Can I make multiple payments to my lawyer?

When you sign up for payment plans , you agree to make multiple payments to your lawyer over time. Any lawyer that's motivated to work will offer you payment plans. Even though they will ask for a deposit upfront, it won't be a significant amount.

Do lawyers take credit cards?

If you're wondering, do lawyers take credit cards, you have to ensure that you can clear up the payments or they won't take on your case. Once your lawyer starts to represent you on an issue, it will be hard for them to pull out, so you should be confident enough to show that you can pay them. When you sign any paperwork with your lawyer, make sure to get copies. Make sure to use a ballpoint pen that won't leak or smear too.

Can I use my credit card to pay my lawyer?

Even though most lawyers will accept credit cards and the fees they come with, not all of them will agree to credit card payments. If your credit limit is high enough, you can use it to pay your attorneys legal fees. You may need to find a credit card that has a larger balance available to be able to pay your lawyer.

Why Accept Credit Cards in the First Place?

Before we can discuss the how it is important to make sure we’re all on the same page as to the why of it all. The first answer any lawyer who accepts credit cards will tell you is the obvious one:

Should You Accept Other Forms of Payment?

As a final note, you should remember that while credit cards should be your top priority, many younger clients prefer alternative methods of payment altogether.

Why do lawyers not accept credit cards?

Aside from ethical issues, processing fees are probably the biggest reason lawyers have avoided accepting credit cards. In jurisdictions that have adopted the language in the ABA’s 1974 ethics opinion permitting credit card payments, passing along surcharges may not be allowed. The original language reads, 4.

When did the Bar Association first look at credit cards?

In 1969, when the American Bar Association’s Committee on Ethics and Professional Responsibility first looked at whether a law firm could accept payment via credit cards, they could not have been more disdainful.

What happens if a client disputes a charge on their credit card?

If a client disputes a charge on their credit card, credit card processors will attempt to claw back money deposited in a disputed transaction. This means the credit card company will be accessing the law firm’s trust account.

What is the first issue when accepting credit card fees into trust?

The first issue when accepting credit card fees into trust is the issue of chargebacks. Lawyers are to hold client-entrusted funds inviolate. No other entity should be able to access funds held in trust.

How much has the Federal Reserve tracked payment methods since 2000?

The US Federal Reserve has tracked payment methods since the year 2000. Checks accounted for nearly $43 billion in transaction value that year. Credit cards and debit cards for only $23.9 billion in that same year. In 2018, the most recent year of published data from the Federal Reserve, checks had declined to $14.5 billion in volume. Credit and debit cards have exploded to $117.4 billion. The use of checks has declined 66%. The use of credit cards has grown 392%!

Can credit cards be used to pay bills?

Not every state ethics committee has equally addressed all the issues surrounding this flexibility. Credits cards are just a funds transfer tool. Clients can use credit card charges to pay outstanding invoices, reimburse law firms for expenses, and deposit funds into a firm’s trust account.

Is a check still accepted?

In a 2018 survey of law firms by Clio, checks were still the payment method most accepted by firms—44 years after the ABA approved credit card payments. This is in spite of checks being eclipsed by payments being made with credit and debit cards by hundreds of billions of dollars across other industries.