Friday, January 28, 2011

CAN SOMEONE EXPLAIN IT TO ME?

I do not understand the “Refund Anticipation Check” being offered by Henry and Richard in replacement of a Refund Anticipation Loan (RAL).

I just heard an ad that says it takes 15 days to get a Refund Anticipation Check from H+T Block (granted it was a Jackson Hewitt ad).

If you submit the return electronically, as H+R will, and choose Direct Deposit you should get your refund in 15 days or earlier.

Why would anyone in their right mind pay Henry and Richard a ridiculous fee to give them a check when the IRS will have the money in their account in the same amount of time or sooner absolutely free?

But then again – why would anyone in their right mind go to Henry and Richard to have their return prepared in the first place?
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H+R Block - don't settle for less! Pay through the nose!

3 comments:

Peter Reilly said...

It may be the market that they are dealing with. Not everybody has an account to direct deposit to. After the refund anticipation check comes in, they will bring it to a check cashing service and give up another couple of hundred basis points or whatever it is that they charge.

Just guessing.

John_Sheeley said...

Robert,

Having owned 5 H&R Block franchises for 13 years, I offer this insight:

(1) For the so-called "un-banked", I had arrangements with local banks to cash these checks, for a fee to the bank.

(2) Many taxpayers liked the concept of the fee being withheld from the refund, which this product offered.

mok said...

Robert, this is an excellent question for my Eco 391 students to consider.

I answer it here:

http://bedbuffalos.blogspot.com/2011/01/explaining-refund-anticipation-check.html