Tax refund loans, also known as instant tax refunds or quick tax refunds, offer quick money owed by the US Internal Revenue Service but are criticized for misleading marketing and high interest rates. Taxpayers should consider all consequences before taking advantage of them.
Tax refund loans, which used to be known as instant tax refunds or quick tax refunds, are very popular for those who want to get money quickly owed by the US Internal Revenue Service. However, they have also been widely criticized for misleading marketing and high interest rates. Those who decide to take advantage of a tax refund loan should carefully consider all the consequences involved.
In the past, tax refund loans were billed as instant refunds for good reason. The taxpayer would receive a portion of the refund from him almost as soon as he filed his taxes. In some cases, he would take an additional day or two. Still, it was a much shorter amount of time than it would normally take for the IRS to send out the refunds.
However, they were not actual refunds from the IRS. Instead, a company, probably the company filing the return, would write you a check in the amount of your refund, less fees, and then they would have rights to your refund. In some cases, waiting an additional week or two would earn them $100 US Dollars (USD) or slightly less.
While the US federal government continues to consider placing restrictions on the practice of tax refund lending, the process remains legal. So, for those who want to take advantage of it, just ask your tax preparer if the company you’re with offers these types of loans. Not all tax preparation companies have tax refunds available, but most national chains do. It is important to know what services your tax preparer offers before they handle your taxes.
In some cases, instant cash advance locations may offer tax refund loans in the event that a tax preparer fails to do so. However, in this case, it will probably act more like a traditional payday loan, where the money will leave your bank account after the tax refund is posted to your account. While some cash advance locations may relax their rules just a bit for tax refund loans, there may still be an upper limit to how much you can get.
In the end, those interested in tax refund loans may be better off using a credit card to finance any purchase while they wait for the tax refund to be posted. Most refunds are posted within 30 days. So it’s possible to make a pretty hefty purchase and still pay it off at the end of the month before any interest accrues.
Smart Asset.
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