Postage answers are almost always in "Notice 123." Bookmark it!:
https://pe.usps.com/cpim/ftp/manuals/dmm300/Notice123.pdf
Notes on lingo: "Retail Rates" are what you pay if you don't print your own postage (say, you use stamps; or pay the clerk at PO). .. .... "Commercial Rates" are when you print you own postage label (like at Stamps.com; PayPal, eBay).

To use LETTER RATE, the letter (mailpiece) must be maximum 1/4 inch thick. If more, PACKAGE rates.
https://pe.usps.com/cpim/ftp/manuals/dmm300/Notice123.pdf ("Quick Reference page, 74)

Robt.