Taxpayers should take notice of rapidly growing "rapid refund" service being offerred by the Tax Preparers especially the big franchises! I would generally be sceptible of this service due the "EXTREMELY HIGH COST" of this feature.

In fact, many of these commerical preparers have been fined by the SEC as the interest rates for these cash advances (on an annualised basis) have ranged from 40% to over 500% APR! Taxpayers simply don't understand the maths aspect of the pricing of this service.

For example, lets assume that your refund is say, $1,000 and you wish to participate in this service and say it costs $50. Your rapid refund results in a cash advance in 1 week of $950, versus say a regular refund in 3 weeks of $1,000.

The interest cost is really $50 for 2 weeks.

In other words on an annualised basis is 26 x $50 = $1,300

This translates into a 130% (1300/1000) Annaulised Interest Rate!

In practice, these rapid refunds offers don't make a material difference in speeding up the refund as most returns would be done electronically and these will certainly have the effect of accelerating your refund that much faster.

Remember, as a taxpayer, you should not be enticed to participate in these schemes as it is your hard-earned refund money that is going into the pockets of a bank or tax preparation company. Understand the cost relative to the benefit, and translate the cost into an annualise interest rate, then decide if this is in your best interest!

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