January 28, 2019 

consumer news PHOTO: GETTY IMAGES 

Tax Season and Your Refund Options 

Changes in banking 

technology make 

managing your 

refund safer and 

easier than ever 

prepaid card, read the fne print and make 

Here are a few tips to ensure that your refund 

arrives as quickly and safely as possible as well 

as some ideas on how to get the most out of 

your money when it does. 

Te Refund Process 

Once you have submitted your federal taxes 

and know you have a refund coming to you, 

the fastest way to get your tax refund is to 

have it electronically deposited into your 

fnancial account through the IRS’s Direct 

Deposit Program. It’s free to consumers, and 

it allows you to deposit your refund into as 

many as three separate accounts. 

While you can still receive your refund in 

the form of a paper check, there are several 

advantages to direct deposit. Not only is 

it faster, direct deposit is also more secure. 

Refund checks sent through the mail can 

be lost, stolen, or returned to the IRS, if 

undeliverable. If you don’t already have a 

bank account, this might be the perfect time 

to open one. 

Another option is to have your refund 

deposited onto a prepaid card. If you use a 

sure you know how to deposit money onto 

the card and any fees involved. Cards difer 

in the types of deposits allowed, the process 

for receiving government deposits, and the 

fees charged for certain transactions. If you 

set up a new prepaid card account for your 

refund, you may be required to provide 

information to validate your identity, such 

as your Social Security number and date 

of birth. 

Whichever method you choose, you 

can track the status of your federal tax 

return from the time the IRS received 

it by visiting https://sa.www4.irs.gov/irfof/ 

lang/en/irfofgetstatus.jsp and filling out the 

appropriate information, or by 

downloading the mobile app IRS2GO at 

https://www.irs.gov/newsroom/irs2goapp. 

For more information on tax refunds, visit 

https://www.irs.gov/refunds. 

Protect Your Money from Tax Scams 

If your personally identifable information 

(PII), such as your name, address, and 

Social Security number, has been stolen, 

the information can be used to open credit 

cards and loans or fle a fraudulent tax 

return in your name, allowing the thief to 

claim your refund. If you suspect that your 

information was stolen, contact the IRS by 

calling 800-908-4490 or visiting the IRS 

website for identity protection at https:// 

www.irs.gov/identity-theft-fraud-scams. 

Be wary of phone calls and emails from 

anyone claiming to be from the IRS. Identity 

thieves have been known to pose as IRS 

agents, providing a fake name and IRS 

badge number and even creating a fake 

phone number that appears on caller ID as 

coming from the IRS. Tese thieves ofen 

threaten people with audits, deportation, 

and other legal action or promise checks 

for unclaimed funds. 

FEDERAL DEPOSIT INSURANCE CORPORATION 
 

Te IRS typically does not initiate emails to 

individuals asking for personal information. 

Before acting on any phone call or email 

purportedly from the IRS, call the agency 

at 800-829-1040. An agent will be able to 

verify whether the IRS is in fact trying to 

get in touch with you. If you are certain 

the contact was part of a scam, report it 

to the Treasury Inspector General for Tax 

Administration by calling 800-366-4484. 

You can also report unsolicited emails by 

forwarding it to phishing@IRS.gov. 

Some people use tax preparers to assist them 

with preparing their tax return. While most 

tax preparers are recognized professionals 

who can be very helpful, some preparers are 

scammers. Be wary of tax preparers who 

advertise with fiers or posters promising 

large refunds or special inside knowledge of 

little known tax credits and rebates or those 

volunteering to come to your home to 

prepare your taxes. Tese scammers make 

money stealing your personal information for 

later use and collecting fees. If you aren’t sure, 

ask for the tax preparer’s PTIN, which is 

the IRS tax preparer identifcation number 

that all legitimate preparers must have. Also, 

ask the preparer for references. 

For more information on protecting 

your tax refund, visit: 

https://www.irs.gov/newsroom/taxscamsconsumer-alerts 

https://www.fdic.gov/consumers/ 

assistance/protection/idthef.html 

What to Do With Your Refund 

Once you have received your refund, you 

need to decide what to do with it. Many 

people use tax refunds to make large purchases 

they might not have the cash for at other 

times of the year. It can also provide a great 

opportunity to start a new savings option, 

contribute to your emergency fund, or 

reduce outstanding debt. 

Te IRS allows you to divide your federal tax 

refund into two or three additional fnancial 

accounts. By splitting your refund, you have 

a convenient option for managing your 

money – sending some of your refund to an 

account for immediate use and setting some 

aside for savings. For example, you could 

have part of your refund deposited to your 

checking account and the remainder sent to 

your Individual Retirement Account, or you 

might use some of your refund to purchase 

U.S. Series I Savings Bonds. (For more 

information on purchasing Savings Bonds 

with your tax refund, visit https://www. 

treasurydirect.gov/.) 

You may also want to consider using your 

refund to start or augment emergency 

savings. Having emergency savings provides 

peace of mind when something unexpected 

occurs, such as a major car or home repair. 

Te amount to set aside for your emergency 

fund will depend on factors such as your 

monthly expenses and the number of people 

in your household, but the general rule of 

thumb is to save at least three to six months’ 

worth of expenses. 

If you are carrying a credit card balance, think 

about using your tax refund to pay it down 

or even pay it of. To get the most from your 

money, it may make sense to pay of a credit 

card with a high interest rate, compounding 

against you month after month. Going 

this route allows you to have more money 

every month once that credit card payment 

vanishes from your list of bills, and it can help 

build your credit as you reduce that debt. 

Making extra payments on your mortgage 

may be another way to use your refund, 

saving you money over the long term. Since 

so much of your mortgage payment goes 

toward paying interest, using your tax refund 

to make an extra payment or two against the 

principal will go a long way to reducing the 

debt and overall cost of the loan. 

If you are getting a tax refund this year, 

remember to take steps to keep your refund 

safe, know the refund options available to 

you, and consider diferent ways to make 

your money work harder for you. 

For more help or information, go to www.fdic.gov or 

call the FDIC toll-free at 1-877-ASK-FDIC (1-877-275-3342). 

Please send your story ideas or comments to Consumer Affairs 

at consumeraffairsmailbox@fdic.gov