IRS decision means tax-refund loans will be harder to make, By Michelle Singletary, August 12, 2010, Washington Post: “The Internal Revenue Service has dealt a hard blow to a tax product that has long needed to be knocked out. The IRS announced recently that starting with next year’s tax filing season it will not provide tax preparers and financial institutions with important debt information on taxpayers that allows the companies to arrange or make refund-anticipation loans, or RALs. A RAL is a short-term loan backed by a tax refund. The loan lasts only until a person’s refund arrives, which can be in about 10 days with electronic filing and direct deposit. Since the 1990s, the IRS has provided to tax preparers and associated financial companies a ‘debt indicator’ as a way to determine how much of a person’s tax refund might be taken by the government…”
Poverty-related issues in the news, from the Institute for Research on Poverty