WASHINGTON - Nearly 20 million tax filers—many of whom count themselves among the working poor—are expected to use a refund anticipation loan (RAL) or refund anticipation check (RAC) this tax season, racking up more than $1.5 billion in short-term credit fees. Some will turn to these devices because they need money fast to pay bills, especially just after the holidays; others need part of the expected tax refund to pay for tax preparation.
What does new research from the Urban Institute say about who needs credit at tax time and why? What role should public policy play in shaping tax-time credit products? Why and how does the tax-preparation industry provide RACs and RALs? And can new financial products provide low-income families better access to credit before Tax Day?
• Melissa Koide, policy director, Center for Financial Services Innovation
• Brett Theodos, research associate, Metropolitan Housing and Communities Policy Center, Urban Institute
• Robert Weinberger, senior fellow, Aspen Institute Initiative on Financial Security; former vice president for government relations, H&R Block
• Chi Chi Wu, staff attorney, National Consumer Law Center
The Urban Institute is a nonprofit, nonpartisan policy research and educational organization that examines the social, economic, and governance challenges facing the nation. It provides information, analyses, and perspectives to public and private decisionmakers to help them address these problems and strives to deepen citizens' understanding of the issues and trade-offs that policymakers face.