We’ve been warning readers for years against “refund anticipation loans,” where tax preparers like H&R Block and Jackson Hewitt give you a pre-paid debit card now loaded with your expected return (minus fees and interest). And yet, these cards have continued to appeal to some lower-income taxpayers who don’t have bank accounts for direct-deposit of their returns. Now the federal government is providing these people with an alternative — a debit card that will accept the direct deposit.
“This pilot program will provide low- and moderate-income Americans with a low-cost option for faster delivery of their federal tax refund,” said Deputy Secretary of the Treasury Neal Wolin.
For this tax season, Treasury is only making the MyAccountCard (heaven forbid anyone put spaces between words) available to the 600,000 people it is notifying by mail in the coming week.
There will be varying monthly fees for having the card, ranging from free to $4.95. There is no fee for making purchases online or at retail merchants, adding cash by direct deposit, paying bills online or making cash withdrawals at one of the 15,000 in-network ATMs.
On the fee side, ATM withdrawals out of network will get you for $2.50 each (plus whatever charges are particular to that ATM); balance inquiries will be $.50. Adding cash to the card at an authorized retail location could cost you up to $4.95.
Do you think these cards could help steer people away from refund anticipation loans?
About MyAccountCard [MyAccountCard.gov]