{"id":16632,"date":"2011-01-04T00:00:00","date_gmt":"2011-01-04T00:00:00","guid":{"rendered":"https:\/\/getirshelp.com\/blog\/tax-refund-anticipation-loans-harder-come-year\/"},"modified":"2026-07-24T22:01:33","modified_gmt":"2026-07-24T22:01:33","slug":"tax-refund-anticipation-loans-harder-come-year","status":"publish","type":"post","link":"https:\/\/getirshelp.com\/blog\/tax-refund-anticipation-loans-harder-come-year\/","title":{"rendered":"Tax Refund Anticipation Loans Harder to come by this Year"},"content":{"rendered":"

I hear from people every week who think their tax problem is the end of the world. It usually isn't. I'm Darrin Mish. I've resolved over $100 million in tax debt for clients. Here's what you should know.<\/p>\n

A new tax filing season has begun with the start of this new year. \u00a0Typically, each tax year sees many taxpayers apply for Refund Anticipation Loans (RALs) or also known as Rapid Refunds. \u00a0RALs are typically short-term loans given out by tax preparers in collaboration with financial institutions to taxpayers based on how much tax refunds they are due to receive. \u00a0However, the situation this year has changed. \u00a0Starting from this tax year, RALs are going to get harder to come by. \u00a0This is because of two major factors.<\/div>\n
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Firstly, in August last year the IRS has informed everyone that it will no longer furnish taxpayers\u2019 \u2018debt indicators\u2019 which is normally used by tax preparers and associated financial institutions as part of their process of giving out RALs. \u00a0Without the \u2018debt indicators\u2019 it would be impossible for tax preparers and banks to ascertain accurately the amount of debt the taxpayer may have outstanding. \u00a0These debts would be payable out of the taxpayer\u2019s refund amount.<\/div>\n
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As you can imagine, many tax preparers and their associated banks may shy away from giving out RALs due to this uncertainty. \u00a0They would lose money if the IRS deducts more debt than they anticipate out of the taxpayer\u2019s refund. \u00a0In light of this situation, the tax preparers and finance companies would inevitably increase their lending rates to cover for the higher likelihood of their making a loss.<\/div>\n
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Secondly, the IRS is encouraging all taxpayers to file their tax returns electronically. \u00a0This would facilitate the tax submission process including the issuance of refunds which can be directly deposited into the taxpayer\u2019s bank account. \u00a0A straightforward electronic filing without any complicated tax issues would allow a taxpayer to receive a refund in as little as 10 working days.<\/div>\n
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This means there would be no strong need for RALs because the taxpayers do not have to wait long for their refunds.<\/div>\n
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A refund anticipation check is actually a temporary bank account into which the refund is deposited and out of which the bank issues payments to the taxpayer. \u00a0This enables taxpayers to have their tax-return preparation and filing fees deducted from their refund, rather than paying those costs upfront. \u00a0RALs are favored by low-income taxpayers who file their taxes early in the season and do not have the cash to pay for tax preparation services.<\/div>\n
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Hence with the new developments, taxpayers would be hard pressed to get approval for RALs this year.<\/div>\n

Check out more Tax Related News<\/a> stories by clicking that link.<\/p>\n

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I hear from people every week who think their tax problem is the end of the world. It usually isn't. I'm Darrin Mish. I've resolved over $100 million in tax debt for clients. Here's what you should know. A new tax filing season has begun with the start of this new year. \u00a0Typically, each tax […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"rop_custom_images_group":[],"rop_custom_messages_group":[],"rop_publish_now":"initial","rop_publish_now_accounts":[],"rop_publish_now_history":[],"rop_publish_now_status":"pending","footnotes":""},"categories":[591],"tags":[],"class_list":["post-16632","post","type-post","status-publish","format-standard","hentry","category-irs-news"],"_links":{"self":[{"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/posts\/16632","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/comments?post=16632"}],"version-history":[{"count":1,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/posts\/16632\/revisions"}],"predecessor-version":[{"id":21878,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/posts\/16632\/revisions\/21878"}],"wp:attachment":[{"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/media?parent=16632"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/categories?post=16632"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/getirshelp.com\/blog\/wp-json\/wp\/v2\/tags?post=16632"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}