Get A Fast Tax Refund Without A Refund Anticipation Loan

Now that the government has cracked down on predatory refund anticipation loans (RAL), some consumers bemoan the fact this “quick money” option is no longer available.

“We were counting on having our entire refund within about three days,” C., of Comanche, Okla., told ConsumerAffairs.com last year. “Without it we are facing cut off notices, canceled insurance and suspension of our driver's license, among other things.

But C. and others would have paid a very high price to get that money early.

“Refund anticipation loans (RALs) are one to two week loans made by banks, facilitated by tax preparers, and secured by the taxpayer’s expected tax refund,” said the Center for Responsible Lending. “RALs can carry triple digit APRs, and expose taxpayers to the risks of unpaid debt if their refunds do not arrive as expected.”

Fortunately, the refund process has been streamlined over the years and those who take advantage of these upgrades can often get their refunds in less than two weeks.

Free File

The first step is to file your return to the IRS electronically. The easiest, and least expensive way to do this is with Free File.

If your income is $57,000 or less, you can use Free File brand-name software to do the hard work for you with free tax preparation and free e-filing. It's available only through IRS.gov, where a number of tax software companies make their products available for free. Some also support state tax returns for free. Go to Free File to take advantage of this option. 

The second step for a speedy refund is to set up for direct deposit. The IRS is trying to discourage the use of paper checks, which cost money to print and mail. Getting your refund posted directly to your bank account speeds up the process and makes everyone happy.

Have your bank account information handy when you begin the Free File process. Once you have filed your return, you can monitor the refund progress with Where's My Refund? on the IRS website. 

One final note. The IRS warns that many scams revolve around bogus email messages that appear to be from the IRS with information about your refund. Don't fall for them If you receive an email that appears to be from the IRS and it asks you to provide any personal information, delete it. It's a scam.