Is An Income Tax Refund Advance Loan Wise?

income tax refund advance loanBy Shawn Lee Martin


We get asked many questions around tax refund time every year and the most common question is: “Is An Income Tax Advance Refund Loan Wise?

Our answer to this depends on several variables including what the advance would be spent on and how much it will cost to get the advance.

This article will cover tax refunds and whether taking out tax refund advance loans is a wise idea.

[Do Not Waste Your Tax Return On Paying Payday Loan Debt! Click Here To See Why!]

What Is A Tax Refund Advance Loan?


When a person has a refund coming from the government they will have the option of getting an on the spot advance loan of the refund total minus the advance loan charges.

Many places including banks, credit unions, H&R Block, Wal-Mart to name a few will offer this service and the cost is usually affordable.

Once the refund arrives the loan is instantly satisfied.

As quickly as tax refunds are processed today with online filing and such people are still always intrigued by instant cash!

Depending on what a person is going to spend this advance on will determine whether it is a wise decision or not.

If a person is in dire need of instant cash to pay an immediate utility bill that may be disconnected or repair a vehicle or furnace for example, or even for rent or food we recommend going ahead and getting the advance.

If a person is going to use the money to reduce debt or pay down a payday loan, for example, they would be better off not taking the advance and paying the extra fees.

Buying new clothes or a new cell phone, for example, would also not be a wise use of tax refund advance loans as one would be better off waiting the week or two for the actual refund to arrive.

Most refunds filed electronically can be automatically deposited into a checking or savings account, or even deposited on a debit card within a week to ten days of filing.

Why A Refund?


One good question to ask is the reason WHY one would be getting a tax refund in the first place.

If a person is getting the refund because the government withheld too much in taxes it would be wise to have the withholding amount reduced through your workplace.

When you pay too much into the government does get free use of that extra money all year so better to have it on your paycheck every payday than let the government hold it for you until tax refund time!

Summary


There are valid reasons to go ahead and take out an income tax refund advance loan and there are also reasons not to waste money on them and I hope we answered your questions on when or when not to take advantage of this service.

Remember, if you ever need any help with out of control payday loan debt we would love to show you how we can help with this!

Please leave any questions or comments you may have below and we will do our best to address them!

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[Do Not Waste Your Tax Return On Paying Payday Loan Debt! Click Here To See Why!]

17 thoughts on “Is An Income Tax Refund Advance Loan Wise?”

  1. Shawn,
    Tax and tax return have always been so complicated to me that I usually tried to avoid these issues as much as I could in the past.
    However, this past year when I started working a lot, the tax withheld from the government was getting so much that I need to get help from difference sources in order to ensure my tax refund will be optimal.
    After considering all these options in the post, I’d say the best call for everyone like me, working an office job will be wait for the refund due to several reasons.
    Looking forward to your other posts.

  2. Hi Shawn,
    I think I would prefer to wait for my refund. After all, if i am getting a refund, that means the government has already had lots of use out of it. Why should I give someone else a piece of it too? I didn’t know there was such a thing until I read your article. It’s not something my tax guy has ever offered. He does wait to get paid until our refund comes in. That is a blessing. This article was very informative.
    Kathy

    1. Hi, Kathy!

      I agree, it is always best to wait for the money. Many payday loan companies want you to use that refund to pay your payday loan debt off but we have a much better way fro this!

      Shawn>>

  3. Hi Shawn,

    I really enjoyed reading this! Sometimes things happen outside of our control like ‘real’ emergencies that might put people into situations like requesting the income tax refund advance. i get that. I like to make a list first and see how really important it is before i go that loan route.

    I usually owe Rev Canada so I’m rarely in that position of getting refund… plus I never want to give them more than what they ask for. Sometimes communication with the other party can go a long way too.

    Great article…thank you!

    Monica

  4. I think you offer great advice not to take out a loan if you don’t need it. This approach will only lead to unwanted debt, which can lead to further problems. However, I agree that there is sometimes a necessity for some people to obtain further borrowings, should the situation demand it.

    1. Hey Daniel!

      I agree sometimes things come up and we need extra money.

      The key is to always pay it off on time and in one payment.

      Shawn>>

  5. I had no idea a tax loan refund was a thing?
    Thanks for the in depth information. I’ve always been the type to increase with holdings and not receive a tax return, as I’m totally against letting the government borrow my money for a year, when I could have it invested in an index fund.
    Thanks for the info.

    1. Hi, Derick!

      I wish everyone thought the way you do!

      I agree that having them hold your money is really a waste and I am glad you are on top of that!

      Shawn>>

  6. I also prefer to wait for the refund. It’s amazing to me how people would be in such dire straits that they borrow money before they get their return. Is this correct?
    If the answer is yes then you need to seriously give your sorry ass a kick.
    I call them financial misfits. I know of this, my family is full of them.
    If you keep using this tactic you will never get ahead in life that’s for sure. Good advice, thanks for providing it.

    1. Hi,m Peter!

      I agree, you will never turn the financial corner if you do not change this kind of behavior. Some people do need the help due to circumstances they have no control over like illness and the likes. That is why we are here to help 🙂

      Shawn>>

  7. The website provide a good opportunity to develop financially especially when battling with debts. By consolidating debts it really put a relieve on someone with the kind of burden on the shoulders. A tax refund loan is a better option ever, however that can affect someone after retirement because at the end you might go home with a little piece of cake if someone does not plan well. All in all the business is very good and interesting and it can help lot of audience visiting your site. Thank you

  8. Very interesting topic that I have been wondering about but never asked the questions. When I filed my taxes I saw this option but I have never used it. Great break down of the options.

    I agree. Being wise with our money takes planning and weighing different things.
    What do you think about getting the cash right now to take advantage of a business move or a investment that will not be there in a couple of weeks or so?

    1. great question!

      It really depends on the risk factor of either of the moves.
      Always good to look at all of the possible outcomes and then weigh the options 🙂

      Shawn>>

  9. The website provide a good opportunity to develop financially especially when battling with debts. By consolidating debts it really put a relieve on someone with the kind of burden on the shoulders. A tax refund loan is a better option ever, however that can affect someone after retirement because at the end you might go home with a little piece of cake if someone does not plan well. All in all the business is very good and interesting and it can help lot of audience visiting your site. Thank you

    1. I agree, it can really make your piece of the pie smaller for sure.

      The best bet is to just wait for the refund 🙂

      Shawn>>

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