Get Your Tax Refund Quickly
Not only can many Hoosiers get their taxes done for free at VITA sites, but if they have a bank account and use direct deposit, they will usually receive their refund within 10 days. Using direct deposit, people can avoid borrowing against their refund with high-cost loans called Rapid Anticipation Loans (RALs), sometimes referred to as “Rapid Refund,” “Fast Cash Refund,” “Express Money” or “Instant Refund.”
These very tempting offers are for you to get your anticipated refund immediately or within a day or two. There is a high price to pay, however, and what is actually being offered is a high-cost loan. These loans are borrowed against the amount of your anticipated refund and often include extremely high interest rates and high fees. Plus, if you don’t get your refund or it is smaller than anticipated, you will have to repay that loan.
RALs are extremely expensive. Loan fees typically range from $30 to $90, which translates into Annual Percentage Rates (APRs) of about 60% to more than 700%. Some tax preparers also charge a separate fee, often called an “administrative” or “application” fee, ranging from $28 to $59 and averaging $32. If you include fees in the calculation, RALs can cost you from 70% to 1,700% APR.
It’s Already Your Money
Your tax refund is money that you worked hard to earn. Don’t give it away. Most taxpayers don’t realize that they can have their refund in two weeks or less even without the costly loan. To avoid the temptation of getting a Refund Anticipation Loan and to save money at tax time:
- If you have an urgent bill to pay, ask creditors for more time until the tax refund check comes from the IRS. Don’t take on a new expensive debt to pay an old bill.
- File your tax return electronically and have your refund deposited directly into your bank account. This will speed up your refund. Some refunds will be deposited in as few as 10 days.
How to Open a Bank Account
Those without a bank account who want direct deposit can obtain information on how to open a bank account at http://www.bankonindy.org/locations-2/locations/
Central Indiana residents with a combined household income under $58,000 will be able to log onto the MyFreeTaxes.com website and electronically file a federal and state return – at no charge! Many of our partners will be placing a link to the MyFreeTaxes.com website on their websites for easy access by clients and employees.
But it gets even better! Local volunteers will also provide telephone and online support for MyFreeTaxes.com users.
This new collaboration will provide a new volunteer opportunity as well as allow more local residents to learn how to prepare their own tax returns using state-of-the-art, user-friendly software. Watch for more detailed information in next month’s newsletter!
E-file for free with FreeFile
If your income is over $58,000 you may choose to e-file your Federal and Indiana State income taxes using free online services.
For federal please click here
For State tax returns please click here