Title: This is a few weeks old, but I was inspired by Jacques.. Fellow HNers really should be very, very wary about using PayPal for anything other than splitting the cost of dinner amongst friends.<p>I've had my PayPal account since 2002, and have been using it to send and receive thousands of dollars since then. Last month, PayPal froze my account. I try to keep it as close to empty as possible, but since they purposely make it hard to get money out (i.e. you can't schedule withdrawls) there were some 2500 USD in donations when they froze it.<p>I write free software. My free software has a "donate" link that goes to the PayPal donation page. The idiots at PayPal froze my account since I couldn't prove 501(c) exemption (which I don't have - and more to the point, never claimed to!) and insist that it's "illegal" to receive donations unless you're a registered non-profit with 501(c) IRS clearance. All this happened when I changed the name of the account from my name to the name of my website (because I didn't want my name on the payment page), bringing to their attention my site and PayPal account.<p>I tried to reason with them (showed the definition of "donation") and explained that I'm just getting paid at the whim of the user for services rendered, and that it isn't a "non-profit donation" in the IRS sense. No luck there. I asked to go back "to the way things were" - back to a normal premier account in my own name, and not in the name of the non-501(c) organization that I run the site under, but they (of course) wouldn't listen.<p>In the end, they stopped responding to my emails and told me to get the papers I need to be able to pull the money out. I cannot transfer the money I have to my bank account. I cannot close my account, withdraw any money, use my PayPal debit card or anything other than (you guessed it) put more money into the PayPal balance. The money frozen is enough to hurt, but not enough to make it worth it for me to get a lawyer or waste too much time on it.<p>So just a word of warning to the wise: don't use PayPal. You'll thank yourself forever.<p>(I ended up switching to Amazon Simple Pay, which is _incredible_ except no phone support and customer service response times for _merchant accounts_ is 3 days+. Then I tried my hand at Google checkout, except my conversions went down, waaay down; and have come to the conclusion that it's stupid to accept money through any of these 3rd party services. Time to check out real payment processing providers like BrainTree &#38; co.)
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