Gift Card Activation Fees

Cbordo1987 · ‎08-25-2022

Do other retailers charge an activation fee when physical gift cards are purchased? If so, what are you charging? and is that activation fee taxable? I am in NY state.

TheRealChipA · ‎08-25-2022

@Cbordo1987 The screen shot below is from the National Conference of State Legislatures’ web page summarizing gift card laws in every state. I circled New York’s law about service fees. I believe, but could be wrong, that activation fees are in the category of Service Fees. At least that is the case in Kentucky where I do business.

Also, sales tax laws are crazy convoluted and different in every state. Here’s a link to New York’s official sales tax information page. There is a link to a Quick Reference Guide here that you’ll probably want to spend time reading, as well as contact numbers if you just want to call them and ask.

Let me know if you need anything else.

Chip A.
Square Expert & Innovator and member of the Square Champions group. (But NOT a Square employee, just a seller like you)

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