subject: Payday Tax Loans [print this page] Payday loans are a fast, efficient way to obtain quick cash during a financial emergency. Payday lenders offer more than just payday loans, however.
Some offer check cashing, prepaid debit cards and even tax preparation. It bears mentioning that they are a much cheaper alternative than tax refund loans, a trendy new phenomenon for quick cash. They may be trendy, but the product bears excessive fees that payday loans simply don't have.
But let's think about it. Since it's time to file your income taxes, you may be thinking about the size of the refund you are entitled to.
If you experience a financial setback at this time, it's only natural to be interested in the possibility of receiving your tax refund money early, right? Be careful - tax refund loans aren't as good as they seem. Tax refund loans, also called instant refund loans or refund anticipation loans, seem like a great thing if you need cash right now. But the costs are steep.
Origination fees range from $29.95 to $89.95, and electronic filing fees of $40 are also common. All you typically need to apply is a year-end pay stub, proof of employment and identification.
Sure, you can receive all or a portion of your tax refund (up to about $5,000) within a couple of days, but why would you want to when payday loans are available without origination or "filing" fees? The fees for the average refund of just under $2,000 extrapolate to an annual percentage rate of 222.5 percent.
Yet 12 million taxpayers paid over $900 million dollars in fees last year just to get their refunds a little faster. People think they need tax refund loans
Have they heard of no fax payday loans? They a much more attractive option.
Yet the new trend persists. People are indeed using tax refund loans to cover cash emergencies.
The IRS doesn't endorse such programs, but neither do they openly speak out against them. They encourage taxpayers to use free electronic filing services, which directly deposit any refund monies due into a consumer's checking or savings account in about 10 business days.
For those who can show hardship, there are even special programs available. But if even that is not fast enough, faxless payday loans are a much better option than tax refund loans.
Recession drives people to desperate ends. Overdue bills, foreclosures, rent and many other ominous signs are threatening the financial well-being of consumers.
Numerous big-box tax preparation companies are swooping in with these high fee, high interest loans. Generally, we don't think it's a good idea to pay such an exorbitant rate to get what would be due to you anyway in a couple of weeks.
If you are due a tax refund, you will receive it in a couple of weeks if you are using free electronic filing with direct deposit. Don't go the route of tax refund loans unless paying exorbitant fees upon fees, plus high interest are OK with you.
Logically, it's not the best choice. If you need quick cash for an emergency and can't wait until you have your tax refund safely in your bank account, try payday loans. They're cheaper, fast and quite discreet.
Once you've dealt with a great payday lender and taken advantage of more of their services than just payday loans, you will see that this industry is really helping the average American get what they need quickly and with little hassle.
