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View Full Version : OT: Accepting PayPal for Payment. - Which Type of Account...?


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01-07-2009, 08:47 PM
Posted By: <b>Kevin Struss</b><p>I have had a PayPal account for a long time for purchases that I made, but I now want to start accepting PayPal for payments due to me. I see that they have three different accounts: Personal, Premier and Business. I have no idea which one I should choose. Any recommendations?<br><br>The main reason why I am going to take PayPal is that I plan on advertising my inventory on eBay, so I am anticipating many of my customers being used to taking PayPal. I would estimate that I will have 10 to 20 transactions a month, averaging $1,000 or so each. I know that some people hate PayPal, but I think that it is a necessary evil for me at this point.<br><br>All suggestions and comments are appreciated.<br><br>Best, Kevin<br><br>

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01-07-2009, 09:00 PM
Posted By: <b>Ken McMillan</b><p>I have a premier account which seems to work well for buying and selling

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01-07-2009, 09:01 PM
Posted By: <b>leon</b><p>First of all welcome to our board. We have known each other almost since I got into the hobby (a short 12-13 yrs ago) and I have always respected your card knowledge and our friendship. <br><br>I have had a paypal account for many years. I think mine started as a personal one and then, for whatever reason...I guess #'s of transactions, I was changed to Premier status. I would guess there will be a definitive answer for you based on cost of doing business at the level you will be. <br><br>That being said ALWAYS remember that you can take a paypal e-check and pay a flat $5 for taking any paypal transaction (I believe). Not everyone realizes that fact. It saves me a ton every year....You have to wait 2-4 days for the money to get into your account but it's quick otherwise, and has a paypal backing. Personally, I think paypal makes some mistakes on the way they do business...but hey, you have read what I have about it. One good thing about it is it's easy. Once again take care, welcome to the board, and good luck. best regards

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01-07-2009, 09:17 PM
Posted By: <b>davidcycleback</b><p>I sell a decent amount and have a business account (I just logged on to check, as I was unsure which type I had). All I can tell you is it has worked for me. When the customers PayPal money, I get it. Though the $10,000 to $20,000 you describe is more than I sell. I might sell a couple thousand in a good month. At circa $120,000/$240,000 a year you might want to boot up to Leon's Premier status.

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01-07-2009, 10:50 PM
Posted By: <b>JK</b><p>Based on the amount you plan to sell, you will need a premier account or a business account.<br><br>A personal account is really limited. You can purchase online all you want. The nice thing about personal accounts is that you are not charged a fee for money received into the account. However, you can only receive up to $500 a month. In addition, while paypal states you can accept limited credit card transactions, in reality, they will make you upgrade to a premier or business account to receive such payments.<br><br>Premier accounts are described by paypal as being for &quot;individuals&quot; who buy and sell online. <br><br>Business accounts are described as being for &quot;merchants who use a group or company name.&quot;<br><br>Both premier and business accounts have unlimited receiving limits and allow you to accept credit card payments. Paypal also takes a cut of any money received into your account - even direct cash payments from a bank account. <br><br>According to paypal's website, the fee to receive payments funded by Credit Card, PayPal Balance, PayPal Instant Transfer or PayPal eCheck ranges from 1.9% to 2.9% + $0.30 USD depending on the amount of transactions. The fee for e-checks, however, will not exceed $5. The specific fee structure is as follows:<br><br>Monthly sales .........................Price per transaction <br><br>$0.00 USD - $3,000.00 .................USD 2.9% + $0.30 USD <br><br>$3,000.01 USD - $10,000.00 ............USD 2.5% + $0.30 USD <br><br>$10,000.01 USD - $100,000.00............USD 2.2% + $0.30 USD <br><br>&gt; $100,000.00...........................USD 1.9% + $0.30 USD <br><br>Finally, I believe if you have a business account (I dont) you can apply for special &quot;merchant rates&quot; if your sales volume meets certain criteria. Contrary to what David suggested above, if you are going to be doing over 10k a month, I would think you'd want a business account.<br><br><br><br><br><br><br><br><br><br><br><br><br><br><br><br>

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01-07-2009, 11:52 PM
Posted By: <b>davidcycleback</b><p>Note that I speak from ignorance.

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01-08-2009, 07:37 AM
Posted By: <b>Kevin Struss</b><p>Thanks guys. I am still trying to figure out if a Premier or Business account is better for me, but now at least I have some good info to go on.<br><br>Kevin

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01-08-2009, 08:22 AM
Posted By: <b>Steve</b><p>If you want to sell on ebay you need a premier account.<br><br>That way you can accept CC payments through Paypal and withdraw<br>all the money you get to your bank account.<br><br>If you stick with the basic you can only withdraw a certain amount and <br>people will have to use paypal balances or a debit card to pay you.<br><br>CC payments will be held in paypal limbo.<br><br><br><br>Many folks create a bank account that is seperate from there regular one.<br><br>Paypal can no longer raid peoples accounts to get chargebacks.<br><br>Good luck!<br><br>Sorry in advance if all this was already mentioned.<br><br>Steve

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01-08-2009, 08:35 AM
Posted By: <b>leon</b><p>If you start taking paypal then you should take all but about $500 out every chance you get. The more you have in there the more that they can take away from you (or freeze). It happens for no good reason many times......Paypal has some idiotic policies....but, as stated, it's almost a must nowadays to do quick business.....Still, use Paypal E-check and save most of your money...regards

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01-08-2009, 09:41 AM
Posted By: <b>Steve</b><p>Leon why leave any amount in the paypal account? <br><br>I withdraw as it comes. Do you leave some in for your buys?<br><br>Steve

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01-08-2009, 09:57 AM
Posted By: <b>E, Daniel</b><p>How do the paypal e-checks work?<br>Are they a physical check made out from a Bank that is then delivered to the recipient, who then needs to bank it into their account?<br>Are there limits on e-check amounts?<br>And most importantly, do the Auction Houses accept payment by paypal e-check?<br><br>Thanks for your help.<br><br>Daniel

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01-08-2009, 10:55 AM
Posted By: <b>Red</b><p>The e in e-check is electronic and nothing is physically sent. PayPal sends you an email saying somebody has given you an e-check but the funds won't go into your account for a few days until it clears. I don't know what the limit is.<br><br>Based on the volume you're going to do there is no reason to sign up for anything but the business account. As your numbers increase the hoops increase and it's easier to establish yourself as a real business from the start. <br><br>The single most important thing that hasn't been mentioned yet is follow their rules when it comes to shipments. For cards of your value you need to use Signature Confirmation, or equivalent with FedEx, and ship to the address that PayPal tells you it's okay to ship to. Most of the PayPal horror stories you hear about are from people who didn't know about the rules or took a gamble making an exception.

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01-08-2009, 11:24 AM
Posted By: <b>davidcycleback</b><p>I speak only from personal experience, but I can accept credit cards and download all my money to my back account on my professional account. I'm not a high roller, but I've experienced no practical limitations to accepting and handling money with my account. Granted, no one's tried to PayPal me $50,000 with their credit card.

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01-08-2009, 11:28 AM
Posted By: <b>Doug</b><p>Is there any way to buy or sell an item over $10,000 using paypal? I recall running into this problem trying to sell a '52 Topps Mantle on ebay about a year ago.

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01-08-2009, 11:34 AM
Posted By: <b>Steve</b><p>If you are selling on ebay you will need a premier account at the least.<br><br>Basic accounts will not accept paypal payments done via a CC.<br><br>Now that ebay is doing away with paper payments and most if not all<br>buyers will be paying via paypal you can't take paypal and not take paypal<br>paid with a CC. If you show the paypal logo you have to take paypal via CC.<br><br>If you are only buying on ebay then by all means the basic account is the way to go.<br><br><br>Steve<br><br>

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01-08-2009, 05:26 PM
Posted By: <b>Andrew S.</b><p>If you are going to make that much per month thru PayPal it will automatically be reported to the IRS. Also, you will pay the highest rate of capital gains tax on that amount. Around 38%. And if you forget to list it on your next 1040 form as income, prison ain't much fun.

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01-08-2009, 07:37 PM
Posted By: <b>Steve</b><p>Is there any way to buy or sell an item over $10,000 using paypal? I recall running into this problem trying to sell a '52 Topps Mantle on ebay about a year ago.<br><br><br>Yes paypal has said that you have the buyer make five 2,000.00 payments<br>or some nonsense like that. That though opens the seller up to being scammed for 8k.<br>As that appears like you had five different transactions.<br><br>Steve

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01-08-2009, 07:41 PM
Posted By: <b>Steve</b><p>I was not aware that paypal tells the IRS anything and they surely do not <br>send out 1099's or whatever they would have to do. Yet anyway.<br><br><br>Steve

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01-08-2009, 10:39 PM
Posted By: <b>Anonymous</b><p><br>Either a business or premier paypal account is fine. You can still accept credit card payments with a business account. <br><br>You can have 2 paypal accounts in your name...I have a personal account too. Paypal says you can only accept $500 per month in transactions on personal accounts. this is not true...you just have to word the transaction as 'goods other' when initiating a payment request. to eliminate paypal fees, the funding source for this has to be bank transfer, paypal balance transfer or electronic check (not debit or credit card). personal accounts are great for outside of ebay transactions when funding by one of the above methods. I use it all the time and pay zero fees when accepting payments.<br><br>whatever you do - make sure you research 'seller protection' before you begin taking payments and mailing items. and insurance protects you the seller, not the buyer. if an item is not signed for or scanned by the post office then you'll more than likely lose any paypal claim for non receipt of items. make sure to dot your i's when receiving paypal payments and shipping items.

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01-14-2009, 07:40 PM
Posted By: <b>Lee Behrens</b><p>Leon,<br><br>From my understanding of echecks, you need to us a bank account only and not the credit card services. If this is the case how do you handle Paypal payments from a buyer. I can definately see where it can save money if they have money in the bank but what of the buyers that need to use credit cards? Do you just use the normal Paypal process?<br><br>Lee

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01-16-2009, 04:38 PM
Posted By: <b>Mike</b><p>I heard starting in the year 2011 paypal will be sending out 1099's to the IRS if you have over $20,000 in receipts or 200+ transactions.

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01-16-2009, 04:55 PM
Posted By: <b>leon</b><p>Believe it or not I have not run into that yet. I really don't like paying too much in fees so would probably either request a check or try to split it. Since I only sold 1 item (not a card) on ebay last year I haven't had to deal with it too much. I think if anyone pays by a CC then they can't do the e-check method...as it has to come from a bank account. I am not positive of this but think that's the case. I do take and send quite a few e-checks and the process does work well....but I have a bank account and my other parties have had one too...regards

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01-17-2009, 05:51 AM
Posted By: <b>Laura</b><p>I think either a Premier or Business account would work for you. Be aware that if you tie your account to a bank account without a credit card, in the event that you'll have to make a refund to a customer (for whatever reason) it will be treated like an eCheck and take several days to clear.<br><br>If you do tie it to a bank account only, I encourage you to leave a slush fund with PayPal, rather than dump your whole balance into your account regularly. Should you need to do a refund, having the slush fund avoids the delay, and keeps a buyer from negging you needlessly, which as we all know they can do now for any reason whatsoever with no consequences to themselves. <img src="http://www.clicksmilies.com/s1106/sauer/angry-smiley-026.gif" alt="[linked image]">