Yes, you can borrow against your refund, but the cost and speed vary widely
You have three main routes to get cash before your refund lands: a refund anticipation loan from a tax preparer, a personal loan from a bank or credit union, or a credit card advance. Each one works differently, costs different amounts, and takes a different amount of time. The fastest is usually a refund anticipation loan, which some tax preparation companies offer while you're filing — you can walk out with cash the same day. The cheapest is usually a personal loan from your own bank or credit union, if you have an account there and decent credit. The riskiest is a credit card cash advance, because the interest rate is typically much higher than other borrowing.
Before you borrow anything, know that your refund may arrive faster than you think. The IRS now deposits most refunds within 21 days of accepting your return, and many arrive in 5 to 10 days. If you filed electronically and chose direct deposit, you may not need to borrow at all.
Key Takeaways
- Refund anticipation loans from tax preparers are the fastest way to get cash, but they charge fees that can run $100 to $300 depending on the loan size.
- Personal loans from your bank or credit union usually have lower interest rates than other borrowing options, but take a few days to a week to fund.
- Credit card cash advances are available immediately but carry interest rates of 20 to 30 percent and start accruing interest right away with no grace period.
- The IRS deposits most refunds within 21 days of accepting your return, so borrowing may not be necessary if you can wait a few weeks.
- If you use a refund anticipation loan, the lender will take the loan amount directly from your refund when it arrives, so you will not receive the full amount.
Refund anticipation loans: same-day cash from your tax preparer
A refund anticipation loan is a short-term loan offered by some tax preparation companies — H&R Block, Jackson Hewitt, Liberty Tax, and others — while you're filing your return. The company lends you money based on the refund amount you expect, and when your refund arrives, the IRS sends it directly to the lender to pay off the loan. You get the cash the same day you file, or within one business day.
The cost is a flat fee, not an interest rate. Fees typically range from $100 to $300, depending on the loan size and the company. Some companies charge less if you use their software or file in person at a store location. The fee is deducted from your refund, so if you borrow $2,000 and pay a $150 fee, your refund will be reduced by $150 after the loan is repaid.
The catch is that you must file your return through that tax preparer to get the loan. You cannot file on your own and then ask for a loan later. Also, the loan is only as large as your expected refund, so if you claim you're getting $3,000 back but the IRS later reduces that to $2,500, you may owe the difference.
Personal loans from banks and credit unions
A personal loan from your bank or credit union is often cheaper than a refund anticipation loan if you have an existing account and reasonable credit. Interest rates for personal loans typically range from 6 to 36 percent depending on your credit score and the lender, which is much lower than credit card rates. You borrow a fixed amount, repay it over a set period (usually 12 to 60 months), and the interest is calculated on the full amount you borrowed.
The downside is timing. Most banks take 2 to 5 business days to fund a personal loan after you're approved. Credit unions are sometimes faster, especially if you already have an account with them. You will need to provide proof of income, your tax return or a recent pay stub, and possibly a recent bank statement. The lender will run a credit check, which may lower your credit score slightly.
If you have a good relationship with your bank or credit union, call and ask whether they offer expedited personal loans or lines of credit for existing customers. Some do, and approval can happen the same day.
Credit card cash advances: immediate but expensive
A credit card cash advance lets you withdraw cash using your credit card at an ATM or bank branch. The money is available immediately, but the cost is high. Most credit cards charge a cash advance fee of 3 to 5 percent of the amount withdrawn, plus an interest rate of 20 to 30 percent — much higher than the rate on regular purchases. Unlike purchases, interest on a cash advance starts accruing immediately; there is no grace period.
If you withdraw $1,000 as a cash advance on a card with a 25 percent interest rate and a 4 percent fee, you pay $40 upfront and then $20.83 per month in interest if you do not pay it back. This option makes sense only if you need the money for a genuine emergency and can pay it back within a month or two.
Comparing the three options side by side
| Option | Speed | Cost | Requirements |
|---|---|---|---|
| Refund anticipation loan | Same day or next business day | $100–$300 flat fee | Must file through that tax preparer |
| Personal loan (bank/credit union) | 2–5 business days | 6–36% interest rate | Account with lender, proof of income, credit check |
| Credit card cash advance | Immediate | 3–5% fee plus 20–30% interest | Credit card with available balance |
What happens if your refund is smaller than expected
If you borrow against your refund and the IRS later reduces the amount — because of an error on your return, a missed deduction, or an offset for unpaid taxes or student loans — you may owe money back to the lender. With a refund anticipation loan, the lender takes what they can from your refund and may ask you to pay the rest. With a personal loan or credit card advance, you are responsible for repaying the full amount you borrowed, regardless of what your refund turns out to be.
To reduce this risk, be conservative when estimating your refund. If you are unsure whether you will get $3,000 or $2,500, borrow only against the $2,500. You can always borrow more later if the refund is larger.
Checking your refund status before you borrow
Before you commit to borrowing, check what the IRS says your refund will be. Use the IRS "Where's My Refund?" tool on IRS.gov, or call the IRS at 1-800-829-1040. You will need your Social Security number, filing status, and the exact refund amount from your return. The tool updates once a day, usually overnight, and will tell you whether your return has been received, accepted, and when your refund is expected to arrive.
If the IRS says your refund will arrive within 5 to 10 days, borrowing may not be worth the cost. If it says 21 days or longer, or if you need the money now, borrowing makes more sense.
Frequently Asked Questions
Can I get a refund anticipation loan if I file my taxes myself?
No. Refund anticipation loans are only available if you file through a tax preparation company that offers them. If you file on your own using tax software or the IRS Free File program, you cannot get this type of loan. You would need to use a personal loan or credit card instead.
What if I owe taxes instead of getting a refund?
You cannot get a refund anticipation loan if you owe money. Personal loans and credit card advances are still available, but they are not tied to your tax situation — you borrow based on your creditworthiness, not your refund. If you owe taxes, you can set up a payment plan with the IRS instead.
Do I have to repay a refund anticipation loan if my refund is delayed?
Yes. The loan is due regardless of when your refund arrives. If the IRS delays your refund beyond the expected date, you are still responsible for paying back the loan on time. This is why it is important to ask the lender what happens if your refund is delayed before you sign the paperwork.
Will borrowing against my refund affect my credit score?
A refund anticipation loan typically does not affect your credit score because it is not reported to credit bureaus. A personal loan will trigger a credit check and may lower your score slightly, but the impact is usually small and temporary. A credit card cash advance does not require a new credit check but will increase your credit card balance, which may lower your score if it raises your overall credit utilization.
Can I borrow more than my expected refund?
No. With a refund anticipation loan, you can only borrow up to the amount the IRS is expected to refund you. With a personal loan or credit card, you can borrow more, but you are borrowing against your own creditworthiness, not your refund, so the amount depends on your income and credit history.