Consumer Protection

Refund Anticipation Loans


Offers of extra cash or immediate tax refunds are often attractive to consumers in difficult financial situations, but the use of Refund Anticipation Loans (RAL), Refund Anticipation Checks (RAC) and Bonus Deposit Checks will ultimately reduce the amount of your tax refund and possibly cost you extra money. RALs and RACs are essentially high-interest loans which must be repaid by your actual tax return. Do not pay to borrow your own money. If your tax return is less than estimated, you will be on the hook for the difference, usually at an exorbitant interest rate.

Before entering into RAL or RAC agreement:

  • Check out the free or low-cost options listed below.
  • Consider that electronically filed returns can be deposited in your account in as few as eight days.
  • If you do not have a bank account, the Internal Revenue Service (IRS) can provide your refund by check or prepaid debit card.
  • Always get a written list of fees before entering into any agreement or having any tax preparation services performed.

Free tax preparation

Many Arkansans can utilize the IRS’s Free File program. This web-based program is a free federal tax preparation and electronic filing program for the approximately 70 percent of taxpayers who earn less than $60,000 in annual adjusted gross income. Eligible consumers can go to IRS.gov and choose from multiple private companies that will file federal returns at no charge.

If you cannot afford to pay for tax preparation assistance, you may also be eligible to receive free help through the Volunteer Income Tax Assistance Program (VITA). Call (800) 829-1040 for information about VITA volunteer locations near you. Additionally, seniors can contact AARP at (888) 227-7669 to find the nearest TCE Tax-Aide site.

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