I have an interpreting business, if I can charge penalties and interest, how much do I charge?
I’ve been an accountant for 15 years, and I’ve often been involved in paying vendor invoices and issuing customer invoices, and what seems to be standard with the vast majority of business is an 18% annual interest on past due balances, or 1.5% per month. Many businesses put this right at the bottom of the invoice, something that says, “Interest of 1.5% per month will be charged on all balances not paid within 30 days of due date.” That’s probably the single most common thing I see. However, it runs the gamut of what you can do, essentially laws are going to vary from state to state as to what you can charge, but in the vast majority of cases, it kind of depends on what you call it. There’s a term in finance that you may have heard called “usury”, which is essentially taking advantage of a customer by charging exorbitant interest, but the problem is, it only applies to interest, so if you call something a “late fee”, you can get by with whatever you want. For example, at the extreme, h
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