Loans on tax refunds can be traps

Published February 15, 2007 5:00am ET



All it takes is a little patience.

When tax returns are completed for taxpayers by a professional, many of them elect to take out a Refund Anticipation Loan with their preparer instead of waiting for the refund check from the Internal Revenue Service. RAL fees accrued by consumers were $960 million in 2005, stated the National Consumer Law Center and Consumer Federation of America in a recent study.

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