Hi @uniquewagons Your question is not really the same as the original post for this thread. But I’ll answer it here. For anyone else who comes across this thread, please note that my answer here IS NOT RELATED to the original subject. It already has a best answer.
Anyway…. @uniquewagons It is never a good idea — and in some cases it can be illegal — to use your personal credit/debit cards at your own business, other than for small ($1) test transactions. This is not a Square restriction, but rather an industry-wide restriction. Here’s why.
Credit card networks (Visa, Mastercard, etc) do not allow it. They consider this to be the same as getting a cash advance without paying the much higher cash advance transaction fees. In some cases I’ve read about, business owners did this as a form of money laundering. Therefore the card networks, backed up by federal regulations, keep an eye out for this. Technically it is a cash advance since you are using Visa (or whoever) to give you money to put into your business, but not paying the correct fee for that cash.
Because of this, Square specifically prohibits it, except for test transactions of very small amounts — like $1. If Square doesn’t prohibit this then the card networks can revoke Square’s ability to process on their networks, which would affect all of us who use Square. If Square detects that we are using personal cards at our businesses, they usually reach out and inform us to cease and desist. But, if the transaction is large enough, they also reserve the right to cancel our account as well as take other actions that might be required by the card networks and/or federal regulations.
So, the very short direct answer to your question is there is a limit. Don’t use your personal cards in your own business, ever. I just 100% comp anything I buy from myself and handle it in my accounting books that way. Some people I know pay in cash for purchases from their business, others write checks.
