Contested — statute on books, enforcement disputed
Texas law prohibits credit card surcharges, but federal courts have ruled against enforcement of the ban — while the Texas Attorney General has issued an opinion asserting it remains enforceable. Most compliance advisors recommend cash discount / dual pricing in Texas instead.
Texas at a glance
| Credit card surcharge | Contested — statute on books, enforcement disputed |
|---|---|
| Maximum surcharge | N/A — surcharge status contested; cash discount recommended |
| Debit & prepaid cards | Never — prohibited nationwide by federal rules and card networks, in every state |
| Cash discount / dual pricing | Legal — permitted in all 50 states with a compliant structure |
| State rule | Surcharge prohibition on the books; enforcement contested in federal court (Tex. Fin. Code § 339.001; AG Opinion KP-0257) |
| Penalty | Statutory penalties exist but enforcement is disputed |
| Disclosure | If surcharging despite the contested status, all card network disclosure rules apply. Convenience fees and cash discounts are clearly permitted. |
What Texas merchants need to know
Texas is the messiest surcharge state in the country. The Texas Finance Code prohibits credit card surcharges, but federal courts ruled against enforcing the ban on First Amendment grounds. Then the Texas Attorney General issued opinion KP-0257 asserting the statute is still enforceable. So the practical answer to 'can I surcharge in Texas?' is: the law says no, the federal courts said the law can't be enforced, and the state's top lawyer says it can. That's not a foundation most businesses want to build their pricing on.
What is unambiguous in Texas: convenience fees are allowed when customers have alternative payment methods, and cash discount / dual pricing programs are fully legal — as they are in every state. For Texas merchants who want to offset processing costs, dual pricing gets you the same economics as a surcharge with none of the legal ambiguity. This is one of the states where the structure of your program genuinely matters, and where we'd tell you to have an attorney review anything labeled a 'surcharge.'
The cash discount alternative
Wherever surcharge rules get complicated, dual pricing doesn't: posting a card price and offering a discount for cash is legal in all 50 states when it's structured correctly — the posted price must be the card price, with cash receiving a true discount. The economics match a surcharge; the compliance profile usually beats it.
Texas is the clearest case in the country for choosing a cash discount program over a surcharge: dual pricing is unambiguously legal, while surcharging sits in a statute-vs-courts standoff that has never fully resolved.
Common questions
Is it legal to charge a credit card fee in Texas?
Is a cash discount program legal in Texas?
What's the difference between a surcharge and a cash discount in Texas?
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Surcharge rules in other states
Not legal advice. Surcharge and pricing laws change through legislation, court decisions, and enforcement positions. This page reflects our review as of July 2026 and is provided for general information. Confirm current requirements with your processor and qualified counsel before implementing any fee or dual-pricing program. This state is under active legal or legislative movement; we re-verify it quarterly.