What a refund advance is and how to get one
A refund advance is a short-term loan from a tax preparation company or lender that gives you money before the IRS sends your actual tax refund. You borrow against the refund you expect to receive, repay the loan when the refund arrives, and the lender keeps a fee. The process typically takes one to three business days from application to funding, though some lenders offer same-day or next-day deposits.
To get a refund advance, you file your tax return with a participating tax preparation company or lender, let them review your expected refund amount, and agree to the loan terms and fees. The lender deposits the advance into your bank account, and when your actual refund comes from the IRS, it goes to the lender first to repay what you borrowed plus the fee. You receive any remaining balance.
Refund advances are not the same as refund anticipation loans (RALs), which were common years ago but are now rare. A refund advance is simpler: you get the money quickly, the lender takes their fee and repayment from your refund, and you move on. No credit check is required for most refund advances, and you do not need a credit card or bank account in your name — though you do need a bank account to receive the deposit.
Key Takeaways
- Refund advances are loans you repay from your tax refund, with fees ranging from $15 to $100 or more depending on the lender and refund size.
- Most tax preparation companies that offer refund advances fund them within one to three business days of approval.
- You will need your Social Security number, expected refund amount, and a bank account to receive the deposit.
- The lender receives your refund directly from the IRS and deducts the loan and fee before sending you the remainder.
- If your actual refund is smaller than expected, you may owe the lender money or have to repay part of the advance out of pocket.
Where to get a refund advance
Tax preparation companies are the most common source. H&R Block, TurboTax, Jackson Hewitt, Liberty Tax, and TaxACT all offer refund advances to customers who file their returns through them. Each company sets its own fees, funding timeline, and terms, so the cost and speed vary.
Some banks and credit unions also offer refund advances, though availability is limited. If you have an account at a bank that participates, you may be able to get an advance through them. Call your bank's customer service line to ask whether they offer this product and what the requirements are.
Online lenders and fintech companies sometimes offer refund advances as well, but they are less common than tax preparation companies. Search for "refund advance" or "tax refund loan" to see what is available in your area, but verify the lender's reputation and read reviews before applying.
Fees and costs you will pay
Refund advance fees vary widely and depend on the lender, the size of your refund, and the speed of funding. Fees typically range from $15 to $100, though some lenders charge a percentage of the loan amount instead of a flat fee. A few lenders charge $0 in fees but make money by offering paid tax preparation or other services.
The fee is deducted from your refund when it arrives, so you do not pay it upfront. If your refund is $2,000 and the fee is $50, you will receive $1,950 after the lender takes their cut. If your refund is smaller than expected — say $1,500 instead of $2,000 — the lender still takes their fee, and you get $1,450.
Some lenders offer faster funding (same-day or next-day) for a higher fee. Compare the fee against how urgently you need the money. If you can wait three business days, a slower option may cost less.
What happens if your refund is smaller than you expected
If the IRS sends a refund smaller than the amount you borrowed, you have a problem. The lender will take their fee and repayment from whatever arrives, and if that is not enough, you owe the difference.
For example: you borrow $1,500 and agree to a $50 fee. You expect a $1,500 refund. But the IRS audits your return and reduces your refund to $1,200. The lender takes $1,200, deducts their $50 fee, and you get $1,150. You are short $350 on the original loan. The lender will contact you to collect the remaining balance, usually by charging your bank account or asking you to pay by check or money order.
This is why refund advances carry risk. You are betting on the accuracy of your expected refund. If you made an error on your return, claimed a credit you do not may have access to for, or owe back taxes or child support that the IRS offsets against your refund, your actual refund will be smaller and you will owe money to the lender.
How long it takes to receive the money
Most lenders fund refund advances within one to three business days of approval. Some advertise same-day or next-day funding, but that usually requires you to apply early in the day and meet other conditions — such as filing your return electronically and having a valid bank account on file.
The timeline depends on when you apply and when the lender processes your request. If you apply on a Friday afternoon, funding may not happen until Monday or Tuesday. If you apply on a holiday or the day before a holiday, expect delays.
Once the lender deposits the money into your bank account, it may take another one to two business days for your bank to make it available, depending on your bank's policies. So the total time from application to having spendable money can be three to five business days in many cases, even if the lender says they fund in one day.
Documents and information you need to provide
To get a refund advance, have the following ready: your Social Security number, your expected refund amount (from your tax return), your filing status, the number of dependents you claim, and your bank account number and routing number for the deposit.
You will also need to provide your name, address, phone number, and email. Some lenders ask for your driver's license number or a photo ID to verify your identity. If you are filing jointly, both spouses may need to provide information.
The lender will ask you to authorize them to receive your refund directly from the IRS. This is done through an IRS form or authorization that you sign as part of the loan agreement. The lender then files this with the IRS so the refund is sent to them instead of to you.
Alternatives to refund advances
If you need money before your refund arrives, consider whether you actually need a refund advance. If you can wait a few weeks, the IRS will send your refund for free. Standard refunds take 21 days or less if you file electronically and request direct deposit. That is much faster than it used to be, and it costs nothing.
If you need money urgently and a refund advance fee seems high, look at other options: a short-term personal loan from a bank or credit union, a cash advance from your employer, a payment plan with a creditor you owe, or a payday loan (though payday loans often carry much higher fees and interest rates than refund advances).
If you are filing your taxes anyway, ask the tax preparation company whether they offer a refund advance with no fee or a low fee. Some do, especially if you also purchase other services like audit defense or tax planning.
What to watch out for
Do not confuse a refund advance with a refund anticipation loan (RAL). RALs were marketed heavily years ago but are now uncommon because they were expensive and risky. If a lender uses the term RAL, ask them to explain the difference from a refund advance and what the total cost is.
Be cautious of lenders that may provide a refund amount or promise you will receive a specific dollar amount. The IRS determines your refund, not the lender. If a lender guarantees a refund or promises you will get a certain amount, that is a red flag.
Read the loan agreement carefully before signing. Make sure you understand the fee, the repayment terms, what happens if your refund is smaller than expected, and how the lender will contact you if you owe money. If anything is unclear, ask the lender to explain it before you proceed.
Frequently Asked Questions
Can I get a refund advance if I have bad credit?
Yes. Most refund advances do not require a credit check. The lender is lending against your expected refund from the IRS, not your creditworthiness. However, you will need a valid bank account and a Social Security number.
What if the IRS rejects my return or delays processing it?
If the IRS rejects your return or takes longer than expected to process it, your refund will be delayed. The lender may still expect repayment on the agreed timeline. Contact the lender immediately to explain the delay and ask about your options. Some lenders will extend the repayment deadline; others may demand immediate repayment or charge additional fees.
Can I get a refund advance if I file jointly with my spouse?
Yes, but both spouses typically need to authorize the advance and agree to the terms. The lender will need both Social Security numbers and both signatures on the loan agreement. Check with the lender about their specific requirements for joint filers.
Do I have to file my taxes with the same company that gives me the refund advance?
Most refund advance lenders require you to file your return through them or use their tax preparation service. Some banks and credit unions that offer refund advances may allow you to file elsewhere, but this is rare. Ask the lender before you apply.
What if I do not receive my refund from the IRS?
If the IRS does not send your refund — for example, because you owe back taxes or child support — the lender will not receive the money to repay the advance. You will owe the full loan amount plus the fee to the lender. Contact the lender and the IRS immediately to find out why your refund was not sent and what your options are.