2018 - 2019 Tax Software Reviews, Tips, and Tools

Rapid Refund

Fast Online Tax Refunds

With the tax season approaching much too quickly, countless businesses are tripping all over each other in a fierce competition to get your business. Even those that offer free online tax filing options are vying for your attention with the hope that you ultimately opt for their upgraded version of a more comprehensive software alternative that carries charges.

All this courting may initially be flattering but then you recall that it is income tax for Uncle Sam that is involved here and that his bodyguard is the ever daunting Internal Review Service (IRS), your pumped up ego suddenly deflates and you becomes leery and are feeling overwhelmed and confused. Hold on to those feelings because they are the ones that will, hopefully, keep you from making the wrong decision.

Fast Tax Refund Anticipation Loans

Fast Tax RefundsLet us first define out terms so that we understand what we are truly talking about:

All electronically filed (e-filed) tax returns, regardless of which software package or company is used, result in a much quicker tax refund if and when the tax payer in question indeed qualifies to receive a tax refund. As a matter of fact, tax refunds can be in the tax payers’ possession within ten business days when filing electronically versus the six to eight weeks that conventional paper filing offers. I would call that a very fast tax refund.

It is important that you, as a tax payer, are aware that the speed of the refund does not depend on the tax preparation firm that you use nor does it depend on the tax preparation software. It is the method of filing that is the key and major factor and, I suppose, the Internal Revenue Service (IRS).

Two more important facts about electronic filing are:

a) It is safe and very secure, and

b) according to the Internal Review Service (IRS), it is by far most accurate because all of the software packages are programmed, in one way or another, to screen out many errors and omissions.

Electronic filing of tax returns is definitely a win-win situation. I highly recommended it, as does the Internal Revenue Service (IRS).

- Rapid refunds, however, are completely different and, in spite of their similar names, are not to be confused with fast tax refunds. Rapid refunds are also known as Refund Anticipation Loans (RAL) and they are offered by some tax preparation firms to taxpayers who want to have their refund right away. In most cases their money is in their possession within twenty-four to forty-eight hours. And here is where I would advise taxpayers to know what they are getting themselves into when opting for such rapid refunds or the refund anticipation loans because they are quite costly.

Taxpayers who are choosing to receive rapid refunds are charged loan fees that range from $29 to $120 which amounts their Annual Percentage Rate (APR) to anywhere between forty percent to seven-hundred percent or higher. On top of these fees there are the fees for electronic filing and tax preparation that usually add up to ten percent or more.

Another issue that needs to be considered is that the amount of refund anticipated is not a guarantee. The Internal Revenue Service may delay, reduce or even deny the refund but the loan will have to be repaid at the rate that has been agreed upon.

I would advise against this option unless it is absolutely unavoidable.

Are Rapid Refunds a Rip-Off?

It's tax time and you want your money now! Many tax services offer options to get your money back from the Internal Revenue Service (IRS) faster. If you're getting a refund, you may not want to wait for what seems like forever for your money. A rapid refund just might sound like a great idea when your anxious to get your money, but beware, it could cost you dearly.

Any time you get a refund earlier from a third-party, you are going to pay some sort of fee, and most likely a very stiff one. The fees associated with barrowing your refund before it arrives can add up, sometimes to hundreds of dollars you didn't expect due to hidden fees you never noticed.

Not all companies charge the same fees, so it is wise to shop around since many big tax service chains will offer quick money options to fulfill your itching cash needs. However, the fees can leave you back where you started, needing more money, with no options this time.

Buyer Beware: Watch Out for Rapid Refund Tax Loans


For some consumers, tax refunds are critical necessities to meeting some immediate needs. however, Refund Anticipation Loans can be a huge financial setback based on cost if you take one out. Refund Anticipation Loans have been under scrutiny by the government and other entities for a long time.

Let's take a look at what you should be considering when faced with the option of taking out one of these risky tax refund equity loans. Questions you should ask include whether there are any hidden fees as they can add up fast, and will this really leave me better off in the end. Ask yourself:

  • are there any processing fees or other hidden fees
  • what interest rate is being charged for using this service
  • should I compare other options
  • what would my refund look like if I don't use this service
  • what would my refund look like if I did use this service
  • do I have options to avoid borrowing this money

The IRS states that 90 percent of tax refunds are paid out within 21 days from receipt of the filers tax return, generally fastest when using efile to file their return. You need to ask yourself, can I wait?

Now, with the IRS website Where's My Refund you can file your taxes online, then start tracking your refund the next day.

Truth be told, you should avoid Rapid Refund Loans and Refund Anticipation Loans at all costs just for the fact that your spending some of your refund dollars in fees just by signing up for one.

It can be much wiser to negotiate other options in anticipation of your refund that wont end up costing you some of the cash your getting back!

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