What Have We Learned From All This?īroadly, you should be careful when doing your taxes. "If we're uncomfortable and view these things as unfair, the government needs to step in," she says. These methods and others have caused Thomas to call for federal lawmakers to regulate tax preparers and software like TurboTax. (Federal regulators shut down the practice about five years ago, prompting the National Consumer Law Center to gush that "it’s not a moment too soon to stop multi-million dollar corporations from skimming off the tax refunds of hard-working families.") Tax preparers still offer Refund Anticipation Checks, or temporary bank accounts where people can access their refunds - minus preparer fees. Thomas compared the Refund Processing fee to Refund Anticipation Loans, which third-party companies used to advertise as a way for people to get their loans faster - at a high cost. If someone finishes their taxes and doesn't have cash ready to cover their preparation fees, "they have no choice but to do it this way," she adds. Thomas explains the option essentially amounts to TurboTax giving users a short-term loan with a high interest rate while their refund clears. "If it's hard to undo or people aren't reading the fine print - which people in general are not good at doing - they're probably able to collect that fee from people" who don't really need the service, Thomas says.įor some, though, the Refund Processing Service isn't about enabling laziness - it's about targeting people who don't have the money on hand to pay TurboTax for doing their taxes. Thomas says the fee ends up catching two kinds of people: unwitting ones and low-income consumers. Social media is flooded with unhappy customers asking TurboTax why they were billed for the fee, which appears to have risen from $29.95 to $39.99 in recent years. And I'm not the only one who almost accidentally got charged for it. "A customer can change their payment method prior e-filing by revisiting the payment options screen and selecting Pay with Credit Card," she added. "You can certainly e-file or direct-deposit your refund without choosing Refund Processing." What Does TurboTax Have to Say About This?Ī spokeswoman for Intuit, which makes TurboTax, tells Money that the service is "an added convenience offered for those customers who don’t have their credit card handy - and is completely optional." "Despite the somewhat misleading name, you don't need Refund Processing to process your refund," it writes in its frequently asked questions section. It's not mandatory - even TurboTax has acknowledged that the title is confusing. It's part of a trend - "the latest in what's been a history of various methods tax software companies have used to get extra money from taxpayers," she says. Kathleen DeLaney Thomas, a professor at the University of North Carolina School of Law, tells Money it's not just a TurboTax issue. What's the Deal With the Refund Processing Fee?Īccording to recent tweets from the Refund Processing fee "is charged by the Santa Barbara Tax Product Group," a TurboTax affiliate company that needs it to cover unspecified "services rendered." Basically, it's a fee to pay your fees. If I, a personal finance reporter who spends 40 hours a week working on a magazine called Money, didn't catch this fee, would other people? What's it used for, anyway? And why is it so tricky to remove? I clicked back through the pages of my return, each time a little afraid I would mistakenly delete some crucial piece of information, until I figured out how to deselect the Refund Processing option. I may be lazy, but I'm not sacrifice-$40-because-I-don't-want-to-find-my-wallet lazy. That's what I was charged for the Refund Processing Service, which surprised me when I went to check out and saw my bill was way higher than I thought it would be. What I didn't realize was that my laziness had a price - of $39.99, to be exact. Why would I get up and dig out my debit card when I could just pay TurboTax from the pool of money I was about to get? I was at my kitchen table, and my purse was in my bedroom. So when I was doing my taxes a few days ago - right before the April 17 deadline, because I'm also a chronic procrastinator - and TurboTax offered me the option to take its preparation fees directly from my refund, it seemed like the obvious choice. I order a lot of takeout, I love to sleep past noon and I prefer to take Ubers instead of the subway. Not so much a slacker, but definitely a couch potato. Let me just cop to this right now: I can be pretty lazy sometimes.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |