Getting your tax refund can sometimes feel like waiting forever. For those needing funds sooner, TurboTax offers a Refund Advance program. This program allows eligible taxpayers to access a portion of their anticipated federal tax refund as a loan, without any loan fees or APR. Let’s delve into the details of the TurboTax Refund Advance to see if it’s the right option for you.
What is the TurboTax Refund Advance?
The TurboTax Refund Advance is essentially a loan, offered by First Century Bank, N.A. or WebBank (neither affiliated with MVB Bank, Inc.), that’s based on your expected federal tax refund. It’s important to understand that this is not your actual tax refund, but a loan anticipating it. This loan comes with a 0% Annual Percentage Rate (APR) and $0 loan fees, making it an appealing option for those who need quick access to funds.
However, eligibility isn’t guaranteed and depends on several factors. The availability of the Refund Advance is subject to identity verification, specific security requirements, eligibility criteria, and underwriting standards. Keep in mind that this offer is time-sensitive, expiring on February 28, 2025, or when the allocated funds are exhausted, whichever comes first. The terms, eligibility, and availability are also subject to change without notice.
While the Refund Advance loan itself has no fees, it’s worth noting that separate fees might apply if you choose to pay for your TurboTax services using your federal refund. Paying with your refund is not mandatory to apply for the Refund Advance. Additional fees may also apply for other optional TurboTax products and services.
Who is Eligible for a Refund Advance?
Not everyone qualifies for a TurboTax Refund Advance. There are specific ineligibility criteria you should be aware of:
- Address Restrictions: You won’t be eligible if your physical address is not included on your federal tax return, is outside the United States or a US territory, is a PO box, or a prison address. Residents of Illinois (IL), Connecticut (CT), or North Carolina (NC) are also currently ineligible.
- Age Limit: You must be at least 18 years old to apply.
- Deceased Taxpayer Returns: Returns filed on behalf of a deceased person are not eligible.
- Specific IRS Forms: Filing certain IRS forms such as 1310, 4852, 4684, 4868, 1040SS, 1040PR, 1040X, 8888, or 8862 will disqualify you.
- Minimum Refund Amount: Your expected federal refund must be $500 or more to be considered.
- Income Documentation: You must have received Forms W-2 or 1099-R or be reporting income on Schedule C.
In addition to these ineligibility factors, you also have mandatory requirements to meet:
- E-file with TurboTax: You must e-file your federal tax return through TurboTax.
- Credit Karma Money™ Spend Account: You need to have or open a Credit Karma Money™ Spend (checking) account with MVB Bank, Inc., Member FDIC. Keep in mind that account opening is subject to eligibility, and there are maximum balance and transfer limits. You can review the Credit Karma Money Spend Account Terms and Disclosures for complete details.
Loan Amounts and Repayment
Even if you are eligible, approval for a loan, or the maximum loan amount, is not guaranteed. If approved, the loan amount will be one of the following: $250, $500, $750, $1,000, $1,500, $2,000, $2,500, $3,000, $3,500, or $4,000. The specific loan amount you are offered will be based on your anticipated federal refund, up to a maximum of 50% of that refund amount.
You will only receive a final decision on your loan approval after the IRS accepts your e-filed federal tax return. Loan repayment is automatically deducted from your federal tax refund, directly reducing the refund amount you ultimately receive.
Accessing Your Funds
If your Refund Advance is approved, the funds are typically deposited into your Credit Karma Money™ Spend (checking) account within 15 minutes of the IRS accepting your e-filed return. You can then access these funds online using a virtual card. Your physical Credit Karma Visa® Debit Card* should arrive within 7 to 14 days. (*Card issued by MVB Bank, Inc., Member FDIC, pursuant to a license from Visa U.S.A. Inc.; Visa terms and conditions apply.) It’s important to be aware that other fees may apply to the Credit Karma Money™ Spend account. For detailed information on potential fees, you can visit: https://support.creditkarma.com/s/article/Are-there-fees-with-a-Credit-Karma-Money-Spend-account.
Your remaining tax refund, after deducting the loan amount and any applicable TurboTax fees, will also be deposited into your Credit Karma Money™ Spend account. The IRS generally disburses tax refunds within 21 days of e-file acceptance. Even if your loan application is denied after IRS acceptance, your tax refund (minus any agreed-upon TurboTax fees) will still be deposited into your Credit Karma Money™ Spend account.
What Happens if Your Refund is Less Than Expected?
In the event your actual tax refund is less than the loan amount, you will not be required to repay any remaining balance on the Refund Advance loan. While you may receive reminders about the remaining balance and options to repay if you choose, you are not obligated to do so. However, it’s crucial to understand that if your loan is not paid in full, you will become ineligible for future Refund Advance loans.
Is TurboTax Refund Advance Right for You?
The TurboTax Refund Advance can be a helpful tool for those who need quick access to a portion of their tax refund. With 0% APR and no loan fees, it can be more affordable than other short-term borrowing options. However, it’s essential to carefully consider the eligibility requirements, understand the loan amounts, and be comfortable opening a Credit Karma Money™ Spend account. By weighing these factors, you can decide if the TurboTax Refund Advance aligns with your financial needs.
