TurboTax is a popular tax filing software package. There are several versions ranging from a free online basic TurboTax edition to a Home and Business TurboTax and more. They all in work in pretty much the same way. The software guides the user through a bunch of fill in the blank entry screens and does all the math and complicated tax worksheets automatically behind the scenes.
For a great many Americans, using TurboTax software is just as good as paying an accountant to file taxes.
Turbo Tax Refund Card
At the end of the Turbo Tax filing process, the software offers users the ability to get their tax refund via a prepaid Visa card. Unlike the Rapid Refund scams of years gone by, there is no promise of a faster refund, and the refund card is not actually a loan against your actual refund. That being said, the whole thing borders on being a TurboTax Refund Card scam.
Like all legitimate businesses, Intuit, maker of TurboTax, covers itself in a sea of fine print and disclosures buried deep beneath the suggestion that this refund method is actually advantageous for the taxpayer filing their taxes. So, technically, everything is on the up and up. However, chances are you’ll be better getting your refund a different way.
First up, is the news that you can get your refund fast, in some cases, the IRS direct deposits the money to your card in as little as 7 days. If you are paying attention, this is the exact same time frame for getting your refund direct deposit into your actual bank account instead of on the Turbo Tax Refund Card. In other words, there is no speed benefit to the card unless you were planning to ask the IRS to mail you a check.
Despite the Visa logo on the card, there is no credit card feature to the refund card. Rather, the card is the same thing as a prepaid Visa card. For those of you who don’t have much experience with prepaid credit cards, it works the same as a debit card only instead of being attached to a checking or savings account at your bank, funds are attached to the card itself. It is very much like a gift card with a prepaid amount on it. The difference is that you can refill it.
Many merchants have similar setups. I have a Starbucks card that works just like this, only it doesn’t have the sneaky fees that push this card from being a legit card to being very close to being a scam.
TurboTax Refund Card Fees
Of course, the devil is in the details. In this case, the devil is in all the fees for the TurboTax Refund card. The first month you have the TurboTax Visa Refund card, there is no monthly charge. After that, there is a monthly fee of $5.95 per month, unless you keep the balance on the card above $50. That means that you don’t want to be using this card to pay for small purchases over a long period of time.
Next up is the fee for cash withdrawals. Using an ATM to get cash from your TurboTax card will cost you $2.50 plus whatever fee the ATM itself charges. It even costs 50 cents to do a balance inquiry through an ATM, although they are free online or via phone or text. You do get ONE free withdrawal each month, but it has to be at an AllPoint network ATM, so check those labels closely.
There is a $4.95 fee to replace a lost or stolen card and if you decide to reload the card with money, that will cost you $4.95 too. You can avoid the fee by using direct deposit.
Is Turbo Tax Refund Card Worth It?
If you already have a bank account, just have your refund direct deposited into your checking account. It will be just as fast as having it sent to a Turbo Tax card, and chances are you already have plenty of ways to access your money ranging from an existing debit card, to checks, ATM cards, and even teller withdrawals, all without having to worry about tripping over any additional fees or expenses.
If you do not have a bank account, the TurboTax Refund Card will get you your refund faster. However, be sure to use up all the money within the first month or keep your balance above $50. Another option is to withdraw the whole amount in one ATM transaction. That first one is free, but remember there is a daily limit to how much you can withdraw. If it will take you two withdrawals (or more) to get all of your cash, be sure to leave at least $50 on the card to avoid the monthly charge. Otherwise, your refund could disappear quickly in a sea of fees.
If the money isn’t burning a hole in your pocket, consider just waiting for the check.
See the official company information here.
TurboTax Refund Card Review originally published at Personal Finance Blog - FinanceGourmet.com