Whether you're starting a new retail food store or you're looking for a way to offer more opportunities to pay to your existing customer base, becoming an EBT retailer can help add more to your bottom line. However, accepting EBT payments is only possible if you have the right processing equipment. That means you'll need EBT point of sale equipment so that you can process those payments and send them off without any hiccups or problems.
But before you can use that equipment to accept those payments, you'll need to become an EBT business. This requires jumping through a few hoops.
Most businesses choose to work with an EBT processing equipment company to help navigate the challenges of becoming an EBT retailer, but you can certainly apply and have a go at it on your own. A helpful partner has already guided many companies through the process, and they'll be able to help if any problem should arise. They can also help when it comes to the complicated setup of your grocery EBT processing equipment, which must be done meticulously to ensure that all your EBT payments are accepted and paid out.
Unfortunately, the government is more in the business of setting regulations rather than helping businesses adhere to them, so it's largely on you as a retailer to make sure that all your Ts are crossed and your Is are dotted. There are common pitfalls that may trip you up, but the right food stamp point of sale partner will help you navigate any and all issues with ease.
Let's take a look at how the EBT application process works.
Becoming an EBT Retailer: The Application
While more retailers are interested in accepting alternative payments such as EBT, it's true that the EBT retailer application process has become more complicated over the years. Even those that have accepted EBT payments for years are having to adhere to more difficult requirements to maintain their EBT standing -- such as specific inventory and revenue requirements -- but it all starts with the application. If you can avoid issues with your application, you'll be able to implement your grocery EBT processing equipment sooner rather than later, and that can be a boon to your business.
1. Documents
A typical EBT application starts with gathering your documents. An EBT license requires that you're either already open and conducting business or that you're within 10 days of buying or opening a store that will serve EBT customers. If your store is already open and operating, you'll need to share certain documents such as:
- Your business' tax return for the previous year
- Social security cards
- Driver's licenses for each owner, member, manager or partner in the business
- Copy of each business license
- Lottery license, alcohol license and tobacco license that your store has obtained
2. Register for a USDA Account
After you've gathered all your documentation, you'll have to register for a USDA account online. A USDA eAuthentication account can be obtained via their web application process. Simply follow the instructions and register for an account. Once your account has been registered, activate your account according to the email process. Activating your USDA account will enable you to apply for becoming an EBT retailer via the SNAP application. That said, if you own 10 or more stores, you'll have to apply as a multi-store owner or MSO.
3. Provide Necessary Documents
When you start your application, you'll have 30 days to complete it. This includes supplying necessary information and submitting the completed application. If you manage not to complete your application within 30 days, it'll be deleted and you'll have to start over. So it's important to complete your EBT retailer application within the time allotted. Note that you'll need the names, addresses and social security numbers for each store owner and manager. You will also need sales information for the store in question as you work your way through the application.
Once you've submitted the required information, you may also have to submit additional information to complete your application. You may receive communication through email or regular mail with instructions on how to submit this additional information, but it's also visible at the end of your application, so don't assume that you're done with the application when you reach the end.
After submitting the completed application and all necessary documentation, you can check your application status directly with the FNS. Once you sign in you'll be able to see the status of your application. If any additional information is needed, you'll be contacted by the FNS. If you have any questions about your application, you can also call the SNAP Retailer Service Center at 1-877-823-4369.
Additional SNAP and EBT Information
EBT machines are now required by law to report all EBT income directly to the IRS. This went into effect in 2012 and affects all EBT point of sale purchases. Along with each purchase, your business' tax information must also be passed over to the IRS. This means that any and all EBT processing equipment must be configured to report this information to the IRS.
If you neglect to report your EBT sales information to the IRS, the law states that the money will be held back from your bank deposits until you can remedy the issue. While you can certainly configure your existing point of sale machines to report this information to the IRS, most grocery businesses obtained new EBT processing equipment that does this automatically, thereby minimizing any issues. That can help make processing EBT payments easier, as well as reducing the burden on you as the retailer.
Streamline Your EBT Payments With VMS
Here at Velocity Merchant Services, we aim to help businesses that want to offer EBT payment options to their customers. Whether you're just starting out or you've accepted EBT payments for years, you can upgrade your EBT and food stamp point of sale equipment without interruption to your EBT transactions or services. Learn more about how VMS can help you become an EBT retailer. We can even help you during the application process!