Business

Tax Refund Advances Appeal to More Cash-Strapped Americans

Published

11 years ago

March 23, 2015

In this March 21, 2015 photo, Brittney Freison, dressed as Lady Liberty, waves to motorists near the Liberty Tax Service office in Berea, Ohio. Wary of rising fees, federal regulators are eyeing ways they can assert tighter oversight upon paid tax preparers who cater to an expanding market of cash-strapped families anxious for their tax refunds. (AP Photo/Mark Duncan)

In this March 21, 2015 photo, Brittney Freison, dressed as Lady Liberty, waves to motorists near the Liberty Tax Service office in Berea, Ohio. (AP Photo/Mark Duncan)

Hope Yen, ASSOCIATED PRESS

WASHINGTON (AP) — Cash-strapped Americans anxious for tax refunds are increasingly turning to payment advances, prepaid cards or other costly services when getting tax preparation help, according to new federal data raising concerns among regulators about whether consumers are fully informed about the fees.

Regulators are looking to increase oversight of preparers amid the rise in “refund anticipation checks,” a type of cash advance especially popular among low-income families who receive the Earned Income Tax Credit, the government’s $65 billion cash benefit program. The advances are being marketed as a way to get fast refunds or defer payment of tax preparation costs.

The Consumer Financial Protection Bureau says some consumers have complaints about refund anticipation checks centered on advertising, quality of service or fees.

The bureau is finalizing the first rules on prepaid debit cards, including those for tax refunds, that would require “easy to understand” disclosures upfront about costs and risks.

Refund anticipation checks rose to roughly 21.6 million in 2014, up 17 percent from 2011, according to IRS data provided to The Associated Press. About half the purchasers are EITC recipients; roughly 84 percent are low-income, according to the data. Industry analysts project the payment advances and their fees will become more widespread as tax preparers seek to boost revenue.

Currently, refund anticipation checks and prepaid cards make up 10 percent of industry giant H&R Block’s revenue and more than 20 percent of Liberty Tax Service’s, according to earnings reports.

Both companies said they are committed to providing consumers with the information they need to make tax-filing decisions, including use of refund anticipation checks. They said the payment advances offer added value, such as convenience.

The Internal Revenue Service has been pushing Congress for new authority to regulate the $10.1 billion tax preparation industry after an appeals court last year barred it from requiring tax preparers to undergo background checks and testing.

“It’s the wild, wild West,” said Nina Olson, the IRS’ national taxpayer advocate, describing the current state of the industry. She called the level of risk for abuse in pricing and quality of service unprecedented.

The National Association of Tax Professionals supports certification of providers to ensure a minimum level of competency. But the Institute for Justice, which filed the lawsuit against IRS, says new licensing requirements and other oversight aren’t the answer.

“We should do more to increase competition, not drive independent tax preparers out of the market,” said Dan Alban, an attorney for the group.

The average tax-preparation fee for 2014 returns is $273, up 11 percent from two years ago, according to a survey by the National Society of Accountants. But there’s wide variation, with fees of $400 or more, according to the National Consumer Law Center.

Netran Washington, 40, a materials handler in Cleveland, says he’s been going to a neighborhood tax preparer for four years, eager for a fast refund. Washington readily agreed when asked if he preferred to pay for the tax preparation later.

Washington says he was later surprised by a $500 fee that included the cost of a cash advance.

Still, he kept going each year until a friend suggested the Volunteer Income Tax Assistance program, an IRS program providing free tax preparation services to low-income families. The IRS-certified tax preparer found a filing error that had cost Washington $1,000 in unused tax credits and helped him file an amended return. “It was very upsetting,” Washington said.

Four states — California, Maryland, New York and Oregon — require preparers to undergo training. The California attorney general’s office recently requested information from H&R Block about its refund anticipation checks, which range in cost from $34.95 to $59.95; at issue may be whether the fees may be subject to strict truth-in-lending laws, the company said in financial filings. H&R Block emphasized that it was a request for information, not a lawsuit.

Consumer groups in Colorado and Ohio are pushing proposals to require greater disclosure.

In Ohio, a federal court two years ago barred the owner of Dayton-based Instant Tax Service from doing business after finding various abuses, including defrauding mostly low-income customers. “Taxpayers should have the ability to research and compare prices,” says David Rothstein of Neighborhood Housing Services of Greater Cleveland.

In his budget proposal, President Barack Obama asked Congress to give IRS and the Treasury Department explicit regulatory authority and to increase penalties for certain tax filing errors due to willful or reckless conduct. Legislation has been introduced in the Senate, but prospects remain uncertain in a GOP-controlled Congress unhappy with the agency’s investigations of the tea party and also its role in implementing Obama’s health care law.

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Associated Press writer Stephen Ohlemacher contributed to this report.

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Follow Hope Yen on Twitter at http://twitter.com/hopeyen1.
Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Oakland Post: Week of September 2 – 8, 2026

The printed Weekly Edition of the Oakland Post: Week of September 2 – 8, 2026

Published

4 days ago

September 7, 2026

Oakland Post

To enlarge your view of this issue, use the slider, magnifying glass icon or full page icon in the lower right corner of the browser window.

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Longtime BWOPA Member Brendalyn Goodall Appointed to California Workforce Development Board

Gov. Gavin Newsom has appointed longtime Black Women Organized for Political Action (BWOPA) member Brendalynn Goodall to the California Workforce Development Board. Goodall, an Oakland resident with decades of experience in public service, has held leadership positions focused on

Published

2 weeks ago

August 30, 2026

Post News Group

Post Co-Publisher Gay Plair Cobb with Brendalynn Goodall. Courtesy photo.

By California Black Media

Gov. Gavin Newsom has appointed longtime Black Women Organized for Political Action (BWOPA) member Brendalynn Goodall to the California Workforce Development Board.

Goodall, an Oakland resident with decades of experience in public service, has held leadership positions focused on employment, aging services and assistance for underserved communities.

“Brendalynn will be a great addition to this Board,” said Gay Plair Cobb, who served as former state Assemblyman Sandre Swanson’s alternate to the California Workforce Development Board (CWDB).

“She understands that California’s non-profit organizations serve persons who have the most significant barriers to their labor market success and that the Board should help these groups navigate the complicated requirements of state funding.

“In other words, she will be a strong advocate for our most marginalized populations. Her voice is needed now, more than ever.”

CWDB works with the governor to shape workforce policies, programs and investments designed to strengthen the state’s economy. It collaborates with employers, workers, labor organizations, educational institutions, community groups and California’s 45 local workforce development boards to expand access to quality jobs and respond to regional employment needs.

According to the board, its work includes coordinating state programs and guiding investments in workforce training and development.

BWOPA California celebrated the appointment, describing Goodall as a dedicated advocate for workers, families and older adults.

“Her appointment reflects a lifetime of leadership, service, and unwavering commitment to strengthening California’s workforce and expanding opportunity for all,” the organization stated in a press release.

Goodall served as summer jobs program coordinator in the Oakland Mayor’s Office from 2012 to 2014. In that position, she helped connect young people with employment opportunities and job experience.

Before joining the Mayor’s Office, Goodall was division manager for Aging and Adult Services in the City of Oakland Human Services Department from 2002 to 2011. She previously served as senior services supervisor and program director for the city’s Department of Aging, Health and Human Services from 1990 to 2002.

Goodall is also a member of the California Commission on Aging, which advises the governor and state officials on policies and programs affecting older Californians.

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Jackie Wright Champions Bay Area Stories, Filmmakers and Cultural Institutions

As an award-winning communications professional, Wright has worked with corporations, nonprofits, government agencies, educational institutions, artists, and community organizations. In 2026, she expanded that work by launching an introductory public relations class for small businesses and nonprofits, offering practical tools for gaining visibility, shaping messages and building productive relationships with the media.

Published

2 weeks ago

August 30, 2026

Post News Group

Jackie Wright of Wright Enterprises. Photo courtesy of Wright Enterprises.

By Carla Thomas

Jackie Wright has spent more than two decades helping people, organizations and communities understand the power of a well-told story.

As founder and president of Wright Enterprises, a San Francisco-based strategic communications and public affairs firm, Wright has built a career spanning journalism, public relations, media relations, crisis communications, community engagement and multimedia storytelling.

Wright’s commitment to storytelling is also deeply personal. She wrote and co-directed the 15-minute documentary, “Love Separated in Life…Love Reunited in Honor,” which chronicles the story of her parents, Specialist Five (S5 Wyley Wright Jr. and Ouida Fay McClendon Wright. Her father, a U.S. Army helicopter crew chief, died in Vietnam in 1964 while serving as an honor guard during a visit by then-Secretary of Defense Robert McNamara. Decades later, Wright and her siblings had their father exhumed from a segregated cemetery in Jacksonville, Florida, and their mother moved from her burial place in Georgia so the couple could be reunited at Arlington National Cemetery in 2014.

The family journey later took Wright and her sister to Vietnam, where they discovered the former military compound that had been named in honor of their father and another fallen soldier. The documentary, centered on love, war, family, racial understanding, and remembrance, earned festival recognition at screenings.

“It was quite an honor to learn about my family’s history and share it on film,” said Wright.

That filmmaking experience complements Wright’s longstanding advocacy for independent cinema. She has served as a media partner and brand ambassador for Bay Area film festivals, including the San Francisco Black Film Festival, Oakland International Film Festival, and the Durban International Film Festival in South Africa.

“It’s important to help filmmakers and underrepresented stories reach broader audiences,” said Wright.

Whether promoting a neighborhood organization, championing an independent filmmaker or preserving her own family history, Wright has remained consistent. Through Wright Enterprises, she has turned communications into both a profession and a form of community service, telling stories that might otherwise go unheard.

“Our stories are an integral part of our history, and our history is not only American history, but worldwide,” she said.