"Mark Bole" <makbo[at]pacbell.net> wrote
- quote -

Oh, I see your and their point now. I remain doubtful that
this leger-de-main of wording that HR Block uses does not
violate the IRS rule. Not to be stubborn; more that I have
been reading about RALs (and one client's contract with HR
Block) and my eyebrow went up at this statement in her Block
paperwork.

- quote -

It is on their radar. That's why the IRS has these rules.
Google and/or see reports like
http://www.irs.gov/pub/irs-utl/2007_..._ral_final.pdf ,
which says in part:

"With the advent of the earned income tax credit (EITC) and
electronic filing, tax refunds have become big business. The
EITC is a government benefit to low income workers, many of
whom have children. Because approximately 56 percent of
Refund Anticipation Loan (RAL) consumers also claim the
EITC, there is a government interest in delivering this
means -tested benefit to the beneficiary without
intermediaries
siphoning off fees. Moreover, because approximately ten
percent of the population is unbanked,2 and financial
literacy leads to asset building and provides a path out of
poverty, the government has an interest in encouraging
unbanked persons to enter the financial mainstream. Since
tax refunds are often the taxpayer's largest lump receipt
during the year,3 a major focus of "banking the unbanked"
should center on taxpayers receiving refunds."

- quote -

For all the reasons the many consumer sites on RALs list, I
doubt any of the AGs have mixed motives.

When an impoverished, poorly educated parent of four comes
to file income taxes on some $16,000 of income (so a simple
return) and is charged $424 for prep, $30 for a "Refund
Account" with HSBC, $26 as a finance charge, and 36% annual
interest, without understanding that she can get her return
done for free and with only a few more days wait worst case
through efiling with VITA et al., there is a problem.

I will check out the IRS's compliance enforcement. Thank
you.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Elle" <honda.lioness[at]spamnocox.net> wrote in message
news:QhfKj.12576$yD6.2705[at]newsfe08.phx...
- quote -

Actually, I don't think I ever saw what the complaint was.

H&R Block does someone's taxes and a refund is calculated.
They say "...IRS...takes as much as 12 days..." but hey
(*********zing your [] convention)
[complete this loan application now and we can give you some money maybe
today!]

I don't see where H&R Block says the IRS refund is any faster.
They say THEY MAY be able to give them an <some> amount faster.

I think that's distinctly different.

Of course the whole concept of RAL's is scam and a sucker bet.
Geo.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Elle" <honda.lioness[at]spamnocox.net> wrote in news:QhfKj.12576$yD6.2705
[at]newsfe08.phx:

- quote -

Well, I started writing before I realized that, indeed. But when I read
your original post, it seemed clear to me that H&RB were talking about a
loan against the anticipated refund as collateral.

I once got burned by a Citibank offer of no interest for 6 months, and now
even more heed the warning: If it sounds too good to be true, it probably
is too good to be true." Why would H&RB "give" anyone money if the didn't
earn some back?

--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Elle wrote:
- quote -

There does not appear to be any IRS regulation prohibiting the "undoing"
in your eyes of advice required to be given.


[...]
- quote -

The brackets had nothing to do with it. He was trying to make the
distinction between a refund on the one hand, and a loan which is
clearly called a loan, on the other. Ditto for GSalisbury.

To answer your original question, why not visit the IRS web site and
search for "compliance enforcement". This issue does not appear to be
on their radar, at least not publicly. Do you suppose all those other
attorneys general you referred to might have some mixed motives for
going after Block, just like Spitzer did when he was one?

Anyway, here is what the IRS says in Form 9325:

"A refund anticipation loan is a loan made to you based on the refund
you expect to receive. This loan is a contract
between you and a lender. The IRS is not involved in this contract,
can't grant or deny the loan, and can't answer any
questions about it. If you have any questions about a refund
anticipation loan, contact your electronic filer or the
lender."

I would not recommend RAL's to anyone, nor would I recommend junk food,
reckless driving, tugging on Superman's cape, pulling the mask off that
old Lone Ranger [a.k.a. "loan arranger", thanx Harlan!], and messing
around with Jim. But there's no point in fretting if people do those
things anyway.

-Mark Bole

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Mark Bole" <makbo[at]pacbell.net> wrote
- quote -

Even if it was, by my reading 4 (c) and (d) "undo" any such
advice.

- quote -

Yes. A quick overview from Wiki, under "RAL":

---
In 2002, H&R Block settled a lawsuit brought by the New York
City Department of Consumer Affairs for predatory lending
practices with regard to RALs and the EITC.

In 2003, the Illinois Attorney General issued a detailed
warning to taxpayers about such loans.

On February 15, 2006, the California Attorney General, Bill
Lockyer, sued H&R Block over its refund anticipation loan
business,[13] citing interest rates exceeded 500%, including
fees (which included the tax preparation fee, which is
unrelated to the RAL, but included per California law).
Lockyer said the company falsely portrayed the nature of the
loans, advertising "cash, cold, green, in your hand, out the
door."

In May 2005, a federal judge in Chicago rejected a $360
million settlement as inadequate.
---

Han, I think you misunderstood the meaning of the words I
had in [ ]. "RAL" is what was in the place of [Refund
Anticipation Loan] in the original text. Brackets are a
writing convention to indicate that the original text is not
being quoted perfectly exactly.

GSalisbury, I am pretty sure that is a distinction without a
difference.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

Elle wrote:
- quote -

A "provided" application? Certainly the taxpayer must have requested
it, they don't hand it out to everyone who walks through the door.

How do you know the advice required by the IRS wasn't provided prior to
receiving the requested application? As I recall, there is a client
service agreement that everyone signs, which most likely addresses this
issue. Do you really think a big ol' target like H&R is going to get
tripped up over something like this? Even when now-disgraced Elliot
Spitzer did his worst a few years back, most of his charges against
Block were thrown out in court.

-Mark Bole

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Han" <nobody[at]nospam.not> wrote in message
news:Xns9A78ADE172698ikkezelf[at]199.45.49.11...
- quote -

the day of application.".

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

"Elle" <honda.lioness[at]spamnocox.net> wrote in news:xjaKj.2573$xd5.2073
[at]newsfe17.phx:

- quote -

RAL available ..." That means that a RAL is NOT a refund, but a "Refund
Anticipation Loan". Note: "proceeds", "anticipation" and "loan". Also
note the words "HSBC Bank Application for a Refund Anticipation Loan"

--
Best regards
Han
email address is invalid

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >

IRS Pub 1345, page 44 states: "The [E-file] provider must...
advise taxpayers that [Refund Anticipation Loans] are... not
a quicker way of receiving refunds from the IRS."

An H&R Block provided "HSBC Bank Application for a Refund
Anticipation Loan" states:
"4.(c) the IRS normally makes an electronic deposit in an
average of about 12 days after an electronic filing; (d)
HSBC tries to make proceeds of an instant RAL available on
the day of application."

How does H&R Block's wording not violate Pub. 1345's rules?

I see nothing else in the H&R Block paperwork indicating an
RAL is not a quicker way of obtaining one's refund.

--
<< ------------------------------------------------------- > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2007) - All rights reserved. > << ------------------------------------------------------- >