By now, the W2s and 1099 reports for 2011 are all out. With April 15th just shy of 2 months away, tax payers are in full swing preparing their taxes and filing for refunds.
How are you getting your refund? If you are one of the many Americans who use a tax preparation services company (Liberty Tax, HR Block etc.) you might have the option to walk away with your expected refund on a prepaid card and not wait for your return. Despite some of the bad press surrounding prepaid cards, this payment instrument has grown faster than any prior new payment method. This year alone prepaid card sales are expected to top $522 billion according to Mercator Advisory Group in Boston.
Getting tax refunds on a prepaid card seems like a great alternative for tax payers who want instant “cash in hand” so to speak and don’t want to wait on the IRS to mail (or electronically deposit) a check. Better yet, this method is a good way to reduce the chances of falling victim to identity theft from stolen tax refund checks. In late January, the IRS and Justice Department conducted a national sweep; arresting 105 people in 23 states involved in identity theft and taxpayer refunds.
It’s not just check stealers and local identity thieves taking advantage of tax season; business owners are being targeted too in phishing attempts. So beware. The Government is not the only target for Tax fraud. It’s prevalent everywhere.