Waiting on your tax refund to come in? ⏰ We know, it’s like watching paint dry, especially if you need the cash. You could take out a tax advance refund loan to get your hands on it sooner, but is it worth it? 🤔
Here’s Five Fast Facts on tax advance refund loans:
- 💰 At Our Limit - Lenders typically use the estimated amount of your tax refund as collateral and they limit lending to a percentage of what you’re owed. For example, if you’re expecting a refund of $4,000, you can get a loan out for $1,000 of it. Many require a specific refund amount to qualify. If you’re expecting a refund in the hundreds versus thousands, you’re likely out of luck.
- 🎣 Catch of the Day - Tax advance refund loans tend to come with a lot of catches. Some may promise you funds as soon as your return is accepted by the IRS, but you may be required to open up a bank account with a specific bank. Some loans also restrict eligibility to certain states.
- 💳 Card Sharks - Some refund loan companies may force you to put your early refund cash on a prepaid card. Another con: you could get charged a fee to transfer the funds from the card to a bank account. H&R Block charges $42 (woof).
- ✂️ Corner Cutting - If you have your heart set on a refund loan, chances are you’ll have to go through a big-name tax prep company. Local accountants and CPAs don’t typically lend money. If you’re self-employed, own a business, or have a complicated tax situation, you’ll likely need something a little more heavy duty and personal to ensure you file correctly. It might be better to have a professional maximize your refund versus cutting corners just to get it sooner.
- 🇺🇸🙂What does this look like moving forward? - Tax advance refund loans can get a little dicey, but they’re still a better option than a payday loan or a title loan. Those bad boys often have insane interest rates (we’re talking like 300%). Tight on cash but want to avoid taking a loan out? Snag a 0% APR credit card to hold you over and pay off the baIance as soon as your refund comes in.
🔥Bottom line: We’re about a month out from this year’s tax filing deadline. Don’t let it pass you by! Make sure you get ‘er done or get an extension. No one wants Uncle Sam at their door (unless he’s got free eggs). Worried about the Trump tariff train? Read up on what’s going on in this article.
Did you take out a tax refund loan this year?
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