JP Morgan has sent out notice to 13000 tax preparers that it plans to discontinue its refund loan operations, leaving tens of thousands of taxpayers with a snowball’s chance in hell of getting a front on money due back from the government come tax time.
This is nothing new for tax preparers. Last year, Jackson Hewitt announced that its RAL (Refund Anticipation Loan) funding was down to about 50%, meaning it could only cover half of the RALs it anticipated it would be asked to process come tax time. The problem came from Santa Barbara Bank & Trust, who funded about 75% of Jackson Hewitt’s RALs, after it was told by the Comptroller of the Currency that it had to increase its capital ratios and quick. SBBT may not have been able to buff up its capital levels but you can buff up your own by following these tips to decrease your “rebate” from Uncle Sam so you aren’t standing around waiting for Treasury to cut you a check:
Keep your exemptions in check This is the easiest, simplest, most obvious solution. If you’re waiting for a huge refund check every year, maybe it’s time to reevaluate the tax position you’ve held since you were in college.
If you’re still in a rush, e-file Sure, it’s not instant, but you’ll get your refund a lot quicker by e-filing than you will the good old fashioned snail mail way. National figures show 60% of Americans used e-file last year, leaving the USPS SOL once again.
File early Again, this seems obvious but if you want your money quicker, file at the front of the line. Americans are procrastinators so if you’re one of the first anxious little taxpayers out of the 1040 gate, chances are your refund will get processed faster.
According to the AP, about 50 inmates are allegedly responsible for requesting $1 million in fraudulent refunds from the IRS and collecting around $100,000 for their diligent efforts. The report states that the inmates used “a standard IRS form” (we’re guessing Form 843?) most for $5,000 and that some checks were sent directly to the jail. Oh and the best part is that the scheme was foiled by “a how-to note…found in an inmate’s cell,” rather than a crack squad of investigators.
To say that the IRS needed some good press would be a gross understatement, but for crissakes, they need some good press. Sure getting Nicolas Cage to bone up $14 mil is okay and everyone is stoked for Ron Howard to make the Service hilarious but they could use a big break right now. We called the Florida branch to get their ideas but the spokesman told us that the Herald pretty much had it right and that’s all that he was saying.
At this point, nothing short of Doug Shulman capturing Osama Bin Laden (with an IRS-issued Remington no less) while singing God Bless America and apologizing for all the unanswered customer service phone calls will get the American public to looking fondly upon the IRS. If you’ve got better ideas, let us know but that would be our suggestion for an improved image campaign.
Inmates at S. Fla. jail accused of scamming IRS [AP via Miami Herald]