Two separate things happen in every card payment. Here's how each one works, with worked examples.
The short version
There are two separate things happening in every payment:
The surcharge the family pays. If your account is set to pass the processing fee to families, a surcharge is added at checkout. Card network and state rules limit this to at most 3% of the order subtotal — and in some cases less, or nothing at all.
The processing fee you pay. This is the fee you already pay to process payments (a 3% rate for most accounts). It's calculated on the full amount that runs through the card, which includes any surcharge the family paid.
Because the surcharge applies to the order subtotal while your processing fee applies to the total charged, there's usually a small difference you cover. The examples below show exactly where.
Why this is changing
Card networks (Visa, Mastercard) and individual state laws set rules on surcharging that we now apply automatically:
A surcharge passed to a family can never be more than 3% of the order subtotal.
Debit and prepaid cards can never be surcharged, regardless of your settings.
Some states cap surcharges below 3% — Colorado and Oklahoma cap at 2%.
Some states prohibit surcharges entirely — Connecticut, Maine, and Massachusetts.
California and Texas allow a surcharge, but only after someone at your funeral home accepts an acknowledgment in your settings.
Two setups: who pays the fee
Your account uses one of two configurations, which you can see and change in Settings → Business → Payment Settings (admin users only):
Funeral home absorbs the fee. Families are never charged a surcharge. You pay the processing rate on the full order, regardless of payment method or state.
Family pays the fee. A surcharge appears at checkout wherever it's permitted, based on card type and your state.
How the calculation works, step by step
All examples assume a $1,000 order at a 3% rate (the most common).
Setup 1: You absorb the fee (any card, any state)
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge | $0.00 |
Total charged to family | $1,000.00 |
Processing fee (3% of $1,000) | −$30.00 |
Your net deposit | $970.00 |
The family pays $1,000. You cover the full $30 fee. This is your choice, and nothing here has changed.
Setup 2, Scenario A: Family pays — credit card, standard state
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge (3%) | +$30.00 |
Total charged to family | $1,030.00 |
Processing fee (3% of $1,030) | −$30.90 |
Your net deposit | $999.10 |
The family covers most of the fee through their surcharge. Because the 3% processing fee applies to the full $1,030 including the surcharge, you cover the last $0.90.
Setup 2, Scenario B: Family pays — credit card, capped state (Colorado, Oklahoma)
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge (2%, state cap) | +$20.00 |
Total charged to family | $1,020.00 |
Processing fee (3% of $1,020) | −$30.60 |
Your net deposit | $989.40 |
Because the state caps the surcharge at 2%, the family covers less of the fee. You cover the difference — $10.60 in this example. This is calculated automatically; there's nothing for you to set up.
Setup 2, Scenario C: Family pays — credit card, acknowledgment state (California, Texas)
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge (3%, once accepted) | +$30.00 |
Total charged to family | $1,030.00 |
Processing fee (3% of $1,030) | −$30.90 |
Your net deposit | $999.10 |
California and Texas let you pass the surcharge, but only after an admin at your funeral home accepts an acknowledgment. It appears automatically in Settings → Business → Payment Settings when you select "Family pays fee." Until it's accepted, no surcharge is added and you cover the full fee, as in Scenario D.
Two additional points for California accounts:
Families see a breakdown of fees by payment type at checkout.
Bank account (ACH) payments need to stay switched on, so families always have a fee-free way to pay.
Setup 2, Scenario D: Family pays — credit card, prohibited state (Connecticut, Maine, Massachusetts)
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge (not allowed) | $0.00 |
Total charged to family | $1,000.00 |
Processing fee (3% of $1,000) | −$30.00 |
Your net deposit | $970.00 |
The state prohibits surcharging, so the family isn't charged a fee even though your account is set to pass it along. You cover the full $30 — the same as if you'd chosen to absorb it.
Setup 2, Scenario E: Family pays with a debit or prepaid card (any state)
Line item | Amount |
Order subtotal | $1,000.00 |
Family surcharge (not allowed on debit) | $0.00 |
Total charged to family | $1,000.00 |
Processing fee (3% of $1,000) | −$30.00 |
Your net deposit | $970.00 |
Debit and prepaid cards can never be surcharged. When a family pays this way you cover the full fee, regardless of your settings or your state.
Quick reference
On a $1,000 order at a 3% rate:
Situation | Family surcharge | Your net deposit |
You absorb the fee | None | $970.00 |
Family pays — credit, standard state | 3% | $999.10 |
Family pays — credit, capped state (CO, OK) | 2% | $989.40 |
Family pays — credit, acknowledgment state (CA, TX) | 3% once accepted | $999.10 |
Family pays — credit, prohibited state (CT, ME, MA) | None | $970.00 |
Family pays — debit or prepaid card | None | $970.00 |
A note on bank payments
In every scenario above where you're covering the fee, bank account (ACH) payments cost you 1% capped at $10 instead of a percentage. On a $5,000 payment that's $10 rather than about $150. Families pay the exact invoice amount either way.
See Accepting Bank Account (ACH) Payments to turn it on or learn more.
A note on state rules
Parting Pro provides technology and payment-processing functionality only. We're not attorneys and this isn't legal advice. Your counsel may reach a different conclusion for your operation than we did for our platform, so please consult your own legal and professional advisors about your pricing, disclosures, and any surcharge or cash-discount program.
Questions?
Reach out to your Client Success Manager or our support team and we'll walk through your specific setup with you.